Technology stocks continue to lead the market higher, and some of the best investments moving forward remain in technology leaders. Let's look at three leading tech stocks to buy now.
1. Nvidia
When you think of a market leader, the first name that should come to mind is Nvidia (NVDA +2.26%). The company's graphics processing units (GPUs) have become the backbone of the artificial intelligence (AI) revolution, and its CUDA software platform has created a deep competitive moat. Most early AI development was built using CUDA, and rewriting that code to work on another platform would be both expensive and time-consuming. That's why Nvidia still controls well over 90% of the GPU market.
Image source: Getty Images.
Its numbers show just how massive the AI wave has become. Nvidia generated $40 billion in data center revenue last quarter, despite not being able to sell a single chip in China. Meanwhile, its AI infrastructure is about much more than chips today. The company now provides complete end-to-end solutions it calls AI factories, that combine chips (such as GPUs and CPUs), software (including CUDA and model-building frameworks like NeMo), and networking (such as NVLink, InfiniBand, and Ethernet) in one stack.
With AI infrastructure spending expected to surge to as much as $4 trillion in the next few years, Nvidia remains in the driver's seat. No other company is as deeply embedded in the AI ecosystem, and it should continue to be one of the biggest winners from AI infrastructure spending.
NASDAQ: NVDA
Key Data Points
2. Microsoft
Microsoft (MSFT +0.56%) is one of Nvidia's largest customers, and it's been expanding its data center infrastructure to try and keep up with surging demand for its cloud computing unit Azure. Azure revenue climbed 39% last quarter, and it could have been even higher if it were not capacity-constrained. That marked its eighth straight quarter of revenue growth above 30%.
One of Microsoft's biggest advantages is that its early investment and partnership with OpenAI gives it privileged access to the startup's most advanced large language models (LLMs). This has led customers to flock to its cloud services to use OpenAI's foundational models to help them build out their own AI models and apps.
In addition, Microsoft is also using OpenAI's models to drive growth across its businesses. Its Copilot AI assistants are seeing strong enterprise adoption, helping push its Productivity and Business Processes segment revenue up 16% last quarter. However, in its fiscal fourth quarter, every business just seemed to be clicking for the tech titan. The company's overall revenue jumped 18% to more than $76 billion, reflecting solid growth across nearly every segment.
NASDAQ: MSFT
Key Data Points
Microsoft continues to invest heavily in expanding data center capacity to meet rising AI demand, and that should keep Azure's growth trajectory strong into 2026 and beyond. Combined with the traction it's seeing in its other businesses, this is a solid stock to own heading into next year.
3. Taiwan Semiconductor Manufacturing
Taiwan Semiconductor Manufacturing (TSM +1.54%) is the behind-the-scenes powerhouse behind the global AI buildout. Producing chips at the smallest possible node sizes with high yields is extremely difficult, and without its technological expertise and scale, the current AI boom would not be possible.
Nearly three-quarters of its revenue now comes from chips made on 7-nanometer or smaller nodes, with 3-nanometer production already contributing meaningfully. It plans to start producing 2-nanometer chips next year and is already developing 1.6-nanometer technology. That ability to consistently shrink nodes while maintaining strong yields has made it indispensable to every leading chipmaker.
NYSE: TSM
Key Data Points
TSMC's importance to the semiconductor industry can be seen in its numbers. For Q3, its revenue jumped 41% to $33.1 billion, driven by AI chip demand. The company expects AI-related chip demand to grow at a mid-40% compound annual growth rate (CAGR) through 2029, and given its position in the industry, it has as good of visibility as anyone.
With AI chip production expected to continue to surge, TSMC is a stock you want to own for the long haul.
