Computers excel at crunching numbers but not at the things that many people do with ease, like language processing, visual perception, object manipulation, reasoning, planning, and learning. Artificial intelligence (AI), including its offshoots of deep learning and machine learning, uses computers to perform tasks that typically require human intelligence, such as language generation and facial recognition.
How do companies use AI?
How do companies use artificial intelligence?
Artificial intelligence, or AI, is created through machine learning, which involves training a system with a tremendous amount of data. It then uses the trained system to make inferences about new data it's never seen.
The simplest example is a system designed to detect objects in images. Images containing those objects are provided to the system, which "learns" how to detect them in other images. The more objects it detects in images, the more accurate the detection system becomes.
Companies employ AI in two main ways. Many tech companies use it to make their existing operations more powerful through high-profile applications like robotics, self-driving cars, and virtual assistants. AI is used by Alphabet subsidiary (GOOGL -0.7%) (GOOG -0.69%) Google to filter spam in Gmail, by Amazon (AMZN -2.06%) to recommend products to customers, and by Netflix (NFLX 1.31%) to guide content creation and recommendations.
More recently, OpenAI's ChatGPT has shown how far generative AI -- a division of artificial intelligence capable of generating texts, images, sounds, and ideas -- has come. It can answer questions directly, write poems, and has even passed bar and medical exams. It has spawned a wave of new generative AI chatbots, including Anthropic's Claude, Alphabet's Gemini, and Meta AI from Meta Platforms. The potential is enormous.
Generative AI
Some companies also profit directly from AI by selling hardware, software, services, or expertise that the technology requires. These are true AI stocks and include those listed and described below.
Five AI stocks to buy in 2025
Five AI stocks to buy in 2025
| Company | AI Focus |
|---|---|
| Nvidia (NASDAQ:NVDA) | Data center GPUs and superchips. |
| Alphabet (NASDAQ:GOOG) (NASDAQ:GOOGL) | Generative AI and self-driving cars. |
| Microsoft (NASDAQ:MSFT) | Memory chips for data centers and generative AI tools. |
| CoreWeave (NASDAQ:CRWV) | Generative-AI focused cloud infrastructure platform. |
| Meta Platforms (NASDAQ:META) | AI chatbots, LLMs, and wearable devices. |
1. Nvidia
Leading graphics processing unit (GPU) company Nvidia has taken advantage of the AI boom, with its GPUs becoming the de facto standard in data centers worldwide. Generative AI's training phase demands a lot of computing power; the phase that follows, the inference phase, typically requires less. Graphics processing unit (GPU) chips, which were once used primarily for rendering video games, support both phases well. Nvidia's ambition is now beyond GPUs, aiming to build AI factories or data centers full of Nvidia components to run AI applications and programming.
Nvidia's data center business now makes up the vast majority of the company's revenue, thanks to the emergence of generative AI. Because it sells the building blocks for AI infrastructure, Nvidia became the first major company to see a significant revenue boost from AI. Revenue surged through 2023 and 2024, and the stock has soared as well; in November 2024, it was briefly the most valuable company in the world. In 2024, full-year revenue jumped 114% to $130.5 billion, driven by the surge in data center demand.
Its chips are popular for running demanding workloads that applications like large language models require. The pure-play chip stock is now selling its new Blackwell platform, which major cloud infrastructure services are deploying in 2025, and demand is outstripping supply.
Self-driving cars and "physical AI" are another area of focus. Nvidia develops hardware and software platforms that can power driver-assistance features and fully autonomous driving, which could be a significant source of revenue if that industry takes off. Automotive revenue is only a small fraction of the company's revenue, but that could change.
With Tesla launching its robotaxi network in Austin, the autonomous vehicle race appears to be heating up, and that should be good news for the semiconductor sector.
A self-driving car must process massive amounts of data from multiple sensors and cameras in real time, detect objects such as pedestrians and other vehicles, and make complex decisions. They require tremendous computing power, which is exactly what Nvidia's platform delivers.
Its professional visualization segment, which includes its omniverse, also has a lot of potential in AI. Nvidia's chipsets could someday be supplanted by more specialized processors designed for AI, but the company is in an enviable position for now.
2. Alphabet
Alphabet has been preparing for the AI revolution for years, acquiring the AI research lab DeepMind in 2014. It's also among the leaders in autonomous vehicles through its Waymo subsidiary, which is now ferrying passengers in its driverless cars in cities like San Francisco and Phoenix.
Alphabet launched Gemini, its own AI chatbot and the latest iteration in its competition with ChatGPT, which some see as a threat to Google Search. So far, concerns about a challenge to its search dominance seem to have been overblown as Alphabet's ad revenue continues to grow steadily. It said that its Gemini 2.5 has been "widely recognized as the best model in the industry."
With information at the heart of its business, it's unsurprising that the company has prioritized AI. It's rolled out AI tools for Google Cloud and Google Workspace, including a generative AI assistant that helps write emails. Even its customer acquisition strategy in the cloud is based around AI -- the company has targeted AI start-ups for its cloud infrastructure service.
AI also plays a role in improving its search engine and YouTube, where it can pinpoint a relevant section of a video and direct users straight to it.
Finally, Alphabet is ramping up spending on capital expenditures with plans to spend $75 billion on AI infrastructure and related needs in 2025.
3. Microsoft
Microsoft has gotten a lot of buzz lately thanks to its partnership with OpenAI. The tech giant began investing in the tech start-up in 2019 and invested another $10 billion in OpenAI following the launch of ChatGPT.
Microsoft has incorporated GPT features across its product portfolio, including its Azure cloud infrastructure service, Edge web browser, Office productivity software suite, and Copilot for Microsoft 365. Azure OpenAI has seen a particularly strong uptake, now counting more than 65% of the Fortune 500 as customers.
CEO Satya Nadella has repeatedly said that he sees AI as the next major computing platform, and the reported $13 billion investment in OpenAI is a sign of the company's conviction in AI and its belief that it needs to lead that transition or get left behind as it did with mobile.
More recently, Microsoft has begun diversifying away from OpenAI, adding both internal and third-party models to products like Microsoft 365 Copilot and Azure, including DeepSeek's R1. The long-term implications for its relationship with OpenAI are unclear, but Microsoft seems to think it's wise to hedge its bets in the AI race.
Microsoft is also harnessing the power of AI in other ways, including automated clinical documentation in healthcare to reduce paperwork and administrative needs. It's also using Azure to allow customers to build custom AI tools.
The company launched Azure AI Foundry in November 2024, which allows its customers to create and manage AI apps and agents. As of April 2025, developers at more than 70,000 companies are using it.
4. CoreWeave
CoreWeave, which had its initial public offering (IPO) in March 2025, may be the closest thing to a pure-play AI stock on the market, and it was the first major AI IPO.
Its cloud infrastructure platform was designed specifically for AI, and it counts customers like Nvidia, OpenAI, Meta Platforms, and Microsoft as part of its core customer base. In fact, Nvidia and OpenAI are both investors in the company.
CoreWeave has grown at an incredible pace over the last three years, going from generating almost nothing in revenue in 2022 to $1.9 billion in revenue in 2024. From 2022 to 2024, revenue grew by more than 100 times.
CoreWeave's business is risky since Microsoft accounted for 62% of its revenue, meaning the business would suffer significantly if Microsoft pulled back on spending with the platform. In its first quarter 2025 report, CoreWeave said that no single company accounted for more than half of its backlog, a sign that its customer concentration is improving.
If you're looking for direct exposure to AI, CoreWeave is a good option since essentially all of its revenue is driven by the demand for computing power to run generative AI programs.
5. Meta Platforms
Unlike the other big tech companies on this list, Meta Platforms doesn't have a cloud computing business, but the company is investing just as much in AI as peers like Alphabet.
Meta AI, the company's chatbot that's available on its apps like Facebook, Instagram, and WhatsApp, had almost 600 million monthly active users as of December 2024, and it continues to update its Llama large language model, which is now up to Llama 4.
It's also allowing its advertisers to use AI creative tools for things like background and video generation and ad copy. AI is also involved in ad targeting, and the company aims to fully automate advertising with AI by 2026.
Additionally, the company is incorporating AI in its hardware division, including its Ray-Ban smart glasses, which offer a built-in camera, open-ear audio, and a range of hands-free features. Its Meta Quest headsets are also connected to Meta AI, allowing users to tap into the power of AI through those headsets.
Management sees AI at the core of its business and driving its transformation across areas like advertising, experiences, and devices.
Machine learning stocks
Machine learning stocks
All the stocks above use machine learning technologies, but if you're looking for more options, here are two others worth considering:
- Palantir (PLTR 2.59%): Palantir has been one of the top-performing AI stocks. The company provides cloud software and specializes in data fusion that helps its customers make important insights by connecting disparate pieces of information hidden in data. It also launched its AI Platform (AIP) in 2023, which has helped accelerate its growth. Palantir deploys machine learning models on top of data foundations and continuously improves them to ensure that they become more useful.
- Tesla (TSLA 0.07%): Tesla might be best known for its electric vehicles, but CEO Elon Musk sees AI as the future of the company, and machine learning and neural networks are very much at the center of the company's autonomous vehicle and Optimus autonomous robot projects. Tesla introduced its driverless Cybercab in October 2024, and the company hopes to begin producing the vehicles by 2026. A big test will come when it launches its robotaxi network in June, and Musk envisions the company expanding to other cities soon after that. Musk has said that Tesla's automation technology could make it the most valuable company in the world.
Deep learning stocks
Deep learning stocks
Deep learning is a subset of machine learning that uses artificial neural networks inspired by the human brain. It's the most advanced kind of AI and is crucial in technologies like self-driving cars. Deep learning is advancing in areas such as preventive healthcare, where predictive algorithms are necessary. It differs from machine learning in that it doesn't require human input.
Nvidia is among the companies closely associated with deep learning. Its GPU chips use deep learning to power data centers and enable autonomous driving and cloud computing, among other functions.
Alphabet has exposure to deep learning through a number of its businesses, including its autonomous vehicle start-up, Waymo. It also owns DeepMind, a deep learning platform that can diagnose eye diseases, predict the shapes of proteins, and accelerate the scientific discovery process.
Related investing topics
AI is a growth business
According to International Data Corporation, the global artificial intelligence market is expected to grow from $235 billion in 2024 to more than $631 billion in 2028.
While the AI market is already large and still growing quickly, plenty of companies can profit from AI. Although picking stocks in a growth industry comes with a lot of uncertainty, these top AI stocks are all worth considering.
FAQ
Artificial intelligence stocks: FAQ
What is the best AI stock to buy?
Artificial intelligence is a fast-moving technology, and AI stocks will likely be volatile as the sector evolves. AI stocks that have attracted the most attention include Nvidia, Microsoft, and Alphabet, but finding the best stock to buy is also a matter of price and valuation, which changes quickly.
Is it good to buy Nvidia stock?
Nvidia has jumped into the lead among semiconductor companies in making AI chips and accelerators, and it has the competitive advantages to help it stay there. The semiconductor sector can also be highly cyclical, and pricing can change rapidly. Additionally, there's the potential for unexpected surprises like the DeepSeek launch, which sent AI stocks like Nvidia plunging. If Nvidia can maintain its lead in AI chips, the stock should continue to be a winner, but it will likely be volatile since the AI landscape is still developing.
What is the biggest AI company?
Currently, the biggest company that has made AI central to its business model is Nvidia, with a market cap that soared past $3 trillion at one point. The tech giant is at the center of the AI revolution as its components are fueling AI applications and are in high demand by major cloud infrastructure companies and others.
Is AI good for investing?
Artificial intelligence is likely to shake up the economy and the business world, creating opportunities in the stock market. Whether AI is good for investing will depend on the company, but there will be winners from the new technology.
What company is No. 1 in AI?
Currently, Nvidia is broadly considered the leader in AI technology. The company has a monopoly-like market share in the data center GPU market, and its revenue has more than tripled since ChatGPT launched. Nvidia isn't guaranteed to remain the leader, though. Competition is on the way, and new technologies can change quickly.
Will AI start-ups challenge tech giants?
Tech giants aren't feeling a significant threat from start-ups yet, but there are some signs that competition is on the rise. Alphabet stock, for example, fell when Apple said it was considering making AI search engines available on Safari, directly competing with Google.
The tensions between OpenAI and Microsoft also show that start-ups could begin to pose more of a threat to the "Magnificent Seven" stocks, though they are unlikely to derail their growth.
