10 Best Artificial Intelligence (AI) Stocks of 2025

By Editorial Team - November 02, 2025

The best artificial intelligence (AI) stocks to watch and potentially invest in for 2025 include a mix of well-established tech giants and high-growth specialized companies.

The AI landscape in late 2025 is marked by accelerated enterprise adoption, with hardware costs dropping 30% annually and energy efficiency rising 40%, making advanced AI more accessible. Global private investments hit record highs, but power consumption and carbon footprints are surging concerns.

Breakthroughs like OpenAI's Sora 2 for cinema-quality videos and Google's Veo 3.1 highlight multimodal progress, while defense-tech and biotech lead early ROI gains from custom AI tools. Stephen Wu from Carthage Capital Management notes that AI must deliver on efficiency amid a shift to agentic systems and data lakehouses for unified platforms. Spending on infrastructure persists, pressuring providers but fueling growth in chips, cloud, and software.

Below is a brief overview of the state of AI, followed by a list of AI stocks that look promising for 2025.

State Of Artificial Intelligence In 2025

A McKinsey report characterizes 2023 as the year "the world discovered generative AI (gen AI)." 2024 is when businesses began realizing value from using gen AI. The rising adoption has sparked extreme demand for AI-capable computing power. Data centers, in turn, invested billions in hardware and software for powering, developing and training AI applications.

In 2025, companies like OpenAI will look to move AI's capabilities into increasingly complex tasks. Use cases for AI will expand across industries and into the personal computing space. Organizations that have invested in AI will attempt to quantify the business value of those investments.

How those business value questions resolve will influence the S&P 500. Stephen Wu, founding and managing partner of Carthage Capital Management, notes that nearly half of the S&P 500 is concentrated in tech stocks. "With AI expectations running high," Wu explains, "it's crucial for AI to continue meeting expectations or there may be severe consequences."

Spending on AI infrastructure will likely continue, but the pace and focus of that spending may change. TechInsights predicts a greater emphasis on cost efficiency over performance. This will pressure the dominant hardware providers to evolve to meet those changing priorities.

Methodology Used For These AI Stock Picks

To capitalize on the trends, we sought out the best artificial intelligence stocks with acceptable valuations, profitable business models, positive outlooks and healthy debt levels. These are the screening criteria:

Direct involvement with or exposure to AI technology
Price-to-earnings (PE) ratio below 55
Gross margin above 50%
EPS growth outlook for next year over 10%
Debt-to-equity (DE) ratio below 1.

Top Artificial Intelligence (AI) Stocks To Buy In 2025

Based on recent analyses and market performance, here are some top AI stocks:

1. Nvidia (NVDA)

Stock price: ~$191 (TradingView)
Recent YTD Performance: ~+40% year-to-date with a 36% gain over 1 year. (TradingView)
Recent Market Capitalisation: ~$4.65 Trillion
PE ratio: 52
Gross margin: 75.9%
TTM EPS: $2.54
EPS growth outlook for next year: 48.9%
Debt/Equity ratio: 0.16
Recommendation: Buy (Grok 4)

Confidence Level: High (Gemini 2.5 Pro), High (Grok 4)
Expected Timeframe: 12-24 months (Gemini 2.5 Pro)
Expected time frame: 12-24 months, with AI infrastructure boom ongoing. (Grok 4)

Nvidia Business Overview

Nvidia designs and sells high-performance semiconductors and related hardware and software. The company's hardware is used in AI-capable data centers, gaming applications, robotics and automotive applications.

Leading chipmaker with advanced deep learning chips powering AI applications for major clients like Alphabet and Meta.
Strong revenue growth (Q3 revenue $35.1B, up 94% YoY) and a wide economic moat.
Analysts expect a potential upside of about 27% in the next 12 months.
Nvidia is considered a foundational player in AI hardware (1, 5).

Why NVDA

For the last year, Nvidia has been showing the world what's possible in terms of monetizing AI. Leveraging its reputation and the extreme demand for AI-capable chips, Nvidia has nearly tripled its enterprise value to become one of the few $3 trillion companies in the world.

Nvidia's expertise and AI positioning are unrivaled. The question for investors is whether the growth opportunity is already built into NVDA's share price. The company's PE ratio is on the high side, but NVDA also has the highest EPS growth outlook and the second-highest gross margin among the stocks on this list. While the greatest gain potential for NVDA may have passed, the stock still has room to run.

Related:

2. Taiwan Semiconductor (TSM)

Why Recommended: 61% market share in foundry; manufactures AI chips for NVDA, AMD. Critical for supply chain amid geopolitical shifts.
Stock price: ~$298
PE ratio: ~31
Market Capitalization: $1.22T
Gross margin: 54.5%
TTM EPS: $6.24
EPS growth outlook for next year: 29.5%
D/E ratio: 0.26.

Taiwan Semiconductor Business Overview

Taiwan Semiconductor makes semiconductors and related devices on contract for customers. The company has fabrication facilities in Taiwan, China, Japan and the U.S.

The Taiwanese chipmaker’s market cap has soared past the trillion-dollar threshold, making it the first Asian stock to hit this milestone since PetroChina’s brief stint in 2007. The company, which supplies chips to both Apple and Nvidia, raised its revenue growth forecast to 30% as AI chip demand shows no signs of cooling off.

Why TSM

TSM is the world's leading semiconductor foundry with an estimated market share of 61%, according to Statista. The closest competitor is Samsung, with 11% market share. TSM customers include leading chip designers that outsource manufacturing, such as Nvidia, AMD and Broadcom.

TSM has a long track record of performance and growth, built on technological expertise. The well-managed company is also critical to the AI infrastructure buildout. While Nvidia, Apple and AMD are designing the chips that will power the AI revolution, TSM is making them.

3. ASML Holding N.V. (ASML)

Why Recommended: Monopoly on EUV lithography for advanced chips; essential for AI semiconductor scaling
Stock price: ~$1054
Market Capitalization: ~$397B
PE ratio: 38
Gross margin: 51.2%
TTM EPS: $19.14
EPS growth outlook for next year: 27.6%
D/E ratio: 0.29.

ASML Holding N.V. Business Overview

ASML Holding is a Dutch company that makes photolithography systems and related services. Photolithography uses light to transfer a pattern to another surface. The process is used with silicon wafers to make semiconductors.

Why ASML

ASML is the dominant market share leader in photolithography machines for semiconductors. The company has long-term relationships with major chip foundries, including Taiwan Semiconductor, Intel and Samsung. Those foundries cannot easily switch to another provider since a tooling change would require expensive downtime.

ASML stock hit a high point in July 2024 and then fell 35%. Investors got nervous when the company announced a conservative guidance for next year. The dip creates a nice buying opportunity for a company that will be essential to semiconductor manufacturing for the foreseeable future.

4. Palantir Technologies (NASDAQ: PLTR)

Focuses on AI-driven data analytics with strong government and commercial contracts.
Stock price: ~$190
Market Capitalization: $451B
Q3 2024 revenue up 44% YoY, with raised full-year revenue guidance to $2.8 billion.
One of the best-performing AI stocks with a 418% one-year return as of July 2025 (1, 2).
Trailing PE ratio: 634.61
Final Recommendation: Hold (Grok 4, Gemini 2.5 Pro)
Confidence Level: Medium
Expected Timeframe: 6–12 months
Rationale for Recommendation: Palantir is executing exceptionally well, with a compelling growth story powered by the AI revolution. However, the current astronomical valuation leaves very little room for error. A "Hold" recommendation reflects the balance between the company's outstanding fundamental performance and the significant risks associated with its high valuation multiples. We will be closely monitoring the company's ability to sustain its torrid growth rate and expand its profitability in the coming quarters to reassess our position.

5. Synopsys (SNPS)

Why Recommended: EDA software for chip design; Ansys acquisition boosts AI-enabled innovation.
Stock price: ~$504.13
Trailing PE ratio: 62.81 (watch for adjustment)
Gross margin: 81.4%
TTM EPS: $9.25
EPS growth outlook for next year: 15.8%
D/E ratio: 0.08
Performance Data or Predictions for 2025: YTD -4.49%, 1-year -7.58%. Q3 revenue $1.74B. Target $556.40 (~20% upside); hold for recovery.

Synopsys Business Overview

Synopsys makes electronic design automation (EDA) software that supports the design, manufacture and testing of integrated circuits. Customers span several verticals, including automotive and semiconductor design.

Why SNPS

Synopsys has been a high-performing stock for years. Morningstar quantifies its 15-year total return at 23.7%, which outperforms peers in the software infrastructure industry.

The track record of performance is comforting, but it looks even better alongside Synopsys' current positioning. The company's product suite will support the AI revolution directly by enabling ongoing innovation in integrated circuit design and manufacturing. Synopsys is also in the process of acquiring engineering simulation provider Ansys (ANSS). The merger will expand Synopsys' market position and be accretive to revenue and earnings in 2025.

6. Teradyne (TER)

Why Recommended: Automated test equipment for AI semiconductors; unmatched in high-performance testing.
Stock price: $123.42
PE ratio: 39
Gross margin: 57.9%
TTM EPS: $3.15
EPS growth outlook for next year: 34.4%
D/E ratio: 0.03
Performance Data or Predictions for 2025: YTD +17.66%, 1-year +32.73%. Q2 revenue $651.8M; Q3 earnings Oct 28. Target $139.38.

Teradyne Business Overview

Teradyne makes automated test equipment for semiconductors, electronic systems and wireless devices. The company also offers robotics equipment and technology.

Why TER

Morningstar categorizes Teradyne as a wide-moat company, meaning it has a significant and enduring competitive advantage. The heart of that advantage is Teradyne's expertise in testing high-performance semiconductors, which is largely unmatched by competitors.

The company's testing solutions will be essential as semiconductors evolve to meet the performance and efficiency needs of more mature AI applications. In its third-quarter earnings release, Teradyne reported guidance-beating EPS—citing AI demand as a factor.

Teradyne also offers investors revenue diversification, strong margins and good financial discipline. Since 2020, the company has reduced its debt by more than $500 million.

7. Broadcom Inc (NASDAQ: AVGO)

Why Recommended: AI accelerators and networking; custom chips for hyperscalers like Anthropic. Specializes in semiconductors and infrastructure software critical for AI data management.
Q3 revenue driven by AI demand, expected to reach $12 billion by year-end.
Strong buy rating with a 23.6% upside target (1).
Performance Data or Predictions for 2025: YTD +45.3%, 1-year ~100%. Q3 revenue $15.96B, AI $5.2B. Q4 guidance $17.4B. Target $353.86; strong
Recommendation: Buy. (Grok 4)

8. Shutterstock (SSTK)

Why Recommended: AI training data licensing; Envato deal expands subscriptions. ~$238M in AI content deals.
Stock price: $31.90
PE ratio: 31
Gross margin: 58.4%
TTM EPS: $1.02
EPS growth outlook for next year: 13.0%
D/E ratio: 0.58
Performance Data or Predictions for 2025: YTD -15.60%, 1-year -11.68%. Q2 revenue $266.99M. Target $26.92; monitor data segment growth.

Shutterstock Business Overview

Shutterstock licenses third-party graphics and images to corporations, broadcast companies, small and medium-sized businesses and individuals.

Why SSTK

Shutterstock recently completed the acquisition of competitor Envato. Envato expands Shutterstock's offering with a subscription for unlimited downloads—formerly a gap in the SSTK's product suite. The company is also seeing organic momentum, with improvements in content performance and growth in its Data, Distribution, and Services segment.

As of the third-quarter earnings release, Shutterstock's data business had grown 40% year to date. This is how Shutterstock benefits from the AI buildout. The company currently has about two dozen deals licensing its content to train generative AI tools. As of August 2024, those deals were cumulatively worth $238 million.

9. Advanced Micro Devices (AMD) (NASDAQ: AMD)

Why Recommended: AI GPUs with V-Cache; OpenAI partnership for infrastructure. Semiconductor company advancing AI workloads with new 3-D V-Cache technology.
Q3 revenue up 18% YoY to $6.8 billion, though recent guidance has tempered sentiment.
Trailing PE ratio: 153.52 (overvalued)
Analysts see a 35% upside potential over the next year (1).
Performance Data or Predictions for 2025: YTD +112.26%, 1-year +64.11%. Q2 revenue $7.68B. Target $239.11. (Grok 4)

10. Snowflake (NYSE: SNOW)

Why Recommended: Cloud data platform for AI analytics; natural language tools simplify queries.
Cloud computing and AI company simplifying data analysis with natural language tools.
Q3 revenue up 28% YoY, with a strong customer base and product cohesion.
Trailing PE ratio: N/A (losses)
Performance Data or Predictions for 2025: YTD +71.91%, 1-year +128.76%. Q2 FY26 revenue $1.14B. Target $265.13; hold.

Other notable AI stocks with strong recent performance

Quantum Computing Inc (QUBT) with an extraordinary 2846% one-year return. (Note: QUBT has never paid dividends)
Applovin Corp (APP), has also delivered substantial gains (2).
Cerence Inc (CRNC), has also delivered substantial gains (2).
Alphabet (GOOGL) is highlighted as undervalued with strong AI prospects.
Microsoft (MSFT) has one of the most AI exposure and are considered solid AI investments.

Bottom Line

AI will be a driving force in the financial markets in 2025. Well-run, high-margin, adaptable businesses that support the development, training and deployment of AI applications are well-positioned for growth as the technology evolves.

In summary, Nvidia, Palantir, TSM, ASML, AMD, Broadcom and Snowflake are among the best AI stocks to watch in 2025, combining strong fundamentals, growth potential, and significant roles in the AI ecosystem. Additionally, investors may consider high-growth smaller AI firms and major tech giants like Alphabet and Microsoft for diversified AI exposure (1, 2, 3).

Frequently Asked Questions (FAQ)

1. What defines an “AI stock” and how were these picks selected?

An “AI stock” typically refers to a company whose core business involves artificial intelligence — for example, AI‐software development, large-scale data infrastructure, AI chips/hardware, or services that leverage generative AI and automation. The picks in the article were selected based on criteria such as:

strong growth potential in AI-related segments,
favourable analyst outlooks and earnings momentum,
market position within the AI ecosystem (software, hardware, services),
valuation considerations (to avoid purely speculative names).
It’s worth noting the AI sector has seen rapid enthusiasm but also rising valuations, so selection is rooted in both the “AI story” and underlying fundamentals. For example, several external lists identify companies like Nvidia, Meta Platforms and others as strong AI stocks for 2025.

2. When is the right time to enter these stocks — should I buy now or wait?

Timing depends on your individual risk tolerance and investment horizon. Some guidelines:

If you believe the AI growth trend has further to run and you’re comfortable with volatility, entering now may make sense.
If valuations feel extended and you prefer more conservative timing, consider waiting for a market dip or pull-back.
You might also use a staggered entry (e.g., buy part now and add later) to spread risk.
Remember: even strong AI companies may see short-term corrections if broader tech sentiment weakens or macro conditions deteriorate.

3. What is the appropriate investment horizon for these AI stocks?

These stocks are best treated as medium- to long-term plays — typically 12-24 months or more — because AI businesses often need time to convert innovation into revenue and earnings. If you’re a shorter-term trader (e.g., 3-6 months), you’ll need to be comfortable with higher volatility and changes in investor sentiment. For more conservative investors, think of these as satellite holdings within a diversified portfolio rather than core “set-and-forget” positions.

4. What are the major risks associated with investing in the AI sector?

Key risks include:

Valuation risk: Many AI stocks trade at premium multiples based on future growth expectations. If the growth doesn’t materialize, prices could correct sharply.
Technology/regulation risk: AI is rapidly evolving, and regulation (e.g., data/privacy, national security) could impose headwinds.
Sector concentration risk: The AI picks may be clustered in a few companies or hardware segments, reducing diversification.
Macro risk: Broader market factors (interest rates, inflation, supply chains) can hurt even strong AI names.
Execution risk: A company may have the AI “story” but struggle with monetizing or scaling its operations.

5. How should these AI stocks fit into a diversified portfolio strategy?

Use them as thematic or growth-oriented components, not the entire portfolio. For example:

Maintain a stable core of broad market/index funds or defensive stocks.
Allocate a smaller portion (depending on your risk appetite) to these high-potential AI stocks.
Rebalance periodically — if an AI stock becomes a large portion of your portfolio, you may need to trim.
Always consider your overall asset mix, time horizon, and whether investing in AI aligns with your goals.

6. Does past performance guarantee future returns for these AI stocks?

No. Past performance provides context — such as which companies have been executing well — but it does not guarantee future returns. The AI sector is dynamic; what looked like a winner last year may face headwinds this year. Use historical data as a starting point but emphasise forward-looking analysis: revenue growth potential, competitive moat, innovation capability.

7. Are these picks suitable for all types of investors?

Not necessarily. These stocks tend to suit investors who:

have a higher risk tolerance,
believe in the long-term AI growth story, and
can tolerate volatility and possible drawdowns.
If you are more conservative, you might prefer a smaller allocation or focus on more stable “enabler” companies (hardware/software) rather than aggressive growth plays. Always match investments to your personal financial goals, timeline, and comfort with risk.

8. How will macroeconomic factors — like interest rates or global trade — affect AI stocks?

Macro factors matter significantly:

Lower interest rates tend to support growth stocks (including AI) by reducing discount rates and making future earnings more valuable.
Inflation or higher rates can dampen investor enthusiasm for high-growth stocks and increase cost of capital.
Global trade and supply‐chain dynamics matter especially for hardware/semiconductor companies. For example, export restrictions or chip shortages can hurt AI infrastructure providers.
When evaluating AI stocks, consider both the company-specific drivers and the macro backdrop.

9. Will this list of AI stocks be updated, and what should readers do if market conditions change?

Yes — it’s best practice to monitor the picks periodically. Markets evolve: a company’s competitive position can change, new regulation can emerge, or broader sentiment may shift. Consider the following:

Revisit your allocations at least quarterly.
Stay informed about earnings, guidance, and industry developments.
Be prepared to trim or exit positions if the thesis breaks (e.g., company misses multiple quarters, shows signs of structural decline).
Consider adding new names if better opportunities arise — but only after doing your research.

10. How can I evaluate whether an AI stock is genuinely well-positioned rather than just a “hyped” name?

Look for these indicators:

Revenue growth from AI-related segments (not just general tech growth).
Moat or competitive advantage: Does the company own unique data, hardware architecture, software stack, or large customer base?
Profitability/Path to profit: Even high-growth AI companies must eventually demonstrate sustainable earnings.
Valuation discipline: Compare the implied future growth assumptions with what is realistically achievable.
Execution track record: Has the management shown competence in scaling operations, controlling costs, and adapting to change?
Industry tailwinds and risk awareness: Is the company operating in a favorable subset of AI (e.g., chips, cloud AI, enterprise AI) and aware of regulatory or supply-chain risks?

Note: Investing in AI stocks carries risks due to market volatility and rapid technological changes. It's advisable to conduct thorough research or consult a financial advisor before investing.

Disclaimer

The information presented in this article is intended for general informational purposes only and should not be construed as professional financial, investment, or medical advice. The revenue figures, company rankings, and projections are based on publicly available data, company reports, and industry estimates as of 2025. All currency conversions, where applicable, are based on annual average exchange rates.

While efforts have been made to ensure the accuracy and timeliness of the information, One Day Advisor and the article’s authors do not guarantee the completeness, reliability, or suitability of the content for any particular purpose. Readers are encouraged to verify details independently and consult qualified professionals before making any business, investment, or healthcare decisions based on the information provided.

The article may reference ongoing developments, regulatory actions, or market events that are subject to change. One Day Advisor is not responsible for any losses or damages arising from the use of this information.

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