Top AI Stocks to Watch as Market Surges

Published Date : 09/06/2025 

The artificial intelligence industry is experiencing unprecedented growth, with billions of dollars at stake. Companies like Nvidia and Amazon are leading the charge with stellar earnings and massive investments in data centers and cloud computing. 

The artificial intelligence (AI) industry is experiencing rapid growth, with hundreds of billions of dollars at stake. Just when some were thinking the AI trade was dead, Nvidia (NASDAQ: NVDA) and other big tech stocks knocked their earnings reports out of the park. The fact is that investment in AI technology, data centers, and other infrastructure is booming with no end in sight.

Just last week, Amazon (NASDAQ: AMZN) announced plans to invest another $10 billion in new data centers in North Carolina. Big Tech companies are expected to spend $325 billion this year, a significant increase over the $223 billion invested in 2024. Far from being over, investment in AI is just getting started.

As you can see below, the AI market is poised to experience significant growth through the end of the decade, and likely well beyond.

Here are two companies every tech investor should have on their radar.

Nvidia's graphics processing units (GPUs) are critical infrastructure for data centers, and the big tech companies are battling to acquire as many as possible. For example, Elon Musk's xAI supercomputer initially started with 100,000 units, doubled this number to 200,000, and rumors suggest it plans to grow to 1,000,000 units in the future. Projects like the one mentioned above for Amazon also require untold thousands of GPUs, and there are many of these projects in progress across the U.S. and the world. The incredible demand is not slacking and is the reason that Nvidia's results continue to dazzle.

Nvidia's data center revenue grew 73% year over year in the recently announced fiscal first quarter of 2026, reaching $39 billion, while total sales increased to $44 billion, representing 69% growth. As shown below, Nvidia's revenue and cash flow growth over the last few years is nothing short of incredible.

There is no indication that the growth won't continue in earnest. Nvidia expects $45 billion in sales for Q2 of fiscal 2026, representing a 50% year-over-year increase. The percentages decrease due to the laws of larger numbers; however, Nvidia will add $15 billion in total sales from Q2 of fiscal 2025 to Q2 of fiscal 2026 by achieving its target.

Nvidia stock currently trades with a price-to-earnings ratio of 46, well below its three-year average of 80. This drops to just 34 on a forward basis. While the exponential gains of the last few years may be over, Nvidia stock will still likely outpace the market, given the high demand for its products and its superior growth rate.

Amazon, on the other hand, is not just investing in data centers but is also expanding its cloud computing services, which are crucial for AI applications. The company's AWS (Amazon Web Services) is a leader in the cloud computing market, providing robust infrastructure and services that support AI development and deployment. Amazon's recent investments and strategic moves highlight its commitment to staying at the forefront of the AI revolution.

In conclusion, both Nvidia and Amazon are key players in the AI market, with robust financials and strategic investments that position them well for continued growth. Investors looking to capitalize on the AI boom should consider adding these stocks to their portfolios. 

Frequently Asked Questions (FAQS): 

Q: What is driving the growth in the AI industry?

A: The growth in the AI industry is driven by increasing investments in AI technology, data centers, and cloud computing. Companies like Nvidia and Amazon are leading the charge with significant investments and innovations.

Q: How much is Amazon investing in new data centers?

A: Amazon has announced plans to invest another $10 billion in new data centers in North Carolina, highlighting its commitment to expanding its AI and cloud computing capabilities.

Q: What is Nvidia's recent financial performance?

A: Nvidia's data center revenue grew 73% year over year in the recently announced fiscal first quarter of 2026, reaching $39 billion, while total sales increased to $44 billion, representing 69% growth.

Q: What is the current price-to-earnings ratio of Nvidia stock?

A: Nvidia stock currently trades with a price-to-earnings ratio of 46, well below its three-year average of 80, and it drops to just 34 on a forward basis.

Q: Why should investors consider Amazon and Nvidia for AI investments?

A: Both Amazon and Nvidia are key players in the AI market with robust financials and strategic investments. Amazon's AWS is a leader in cloud computing, and Nvidia's GPUs are critical for data centers, making them strong choices for investors looking to capitalize on the AI boom. 

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