The artificial intelligence (AI) market has exploded since early last year, creating many millionaires. The technology’s enormous potential and its ability to boost countless industries made investors bullish on almost every company that ventured into AI. In fact the Nasdaq-100 The technology sector is up 35% since June last year, mainly due to excitement about AI.
Despite the industry’s rapid rise, it appears that AI is far from reaching its ceiling and will likely create even more millionaires in the coming years. Data from Grand View Research shows that the AI market will generate nearly $200 billion in spending by 2023 and projects will reach just under $2 trillion by the end of the decade as the sector grows at a compound annual growth rate of 37%.
As a result, it could be worth investing in some of the most prominent players in AI and potentially benefiting from the long-term growth of the market. Here are two millionaire artificial intelligence stocks that could be worth buying in June.
1. Nvidia
Few companies have benefited so much from the AI boom Nvidia (NASDAQ: NVDA). The company’s shares have skyrocketed 223% since June last year as it reaches an estimated 90% market share in AI chips.
Years of dominance in the graphics processing units (GPU) market paved the way for Nvidia to gain an edge in AI, while rivals like Advanced micro devices And Intel hurried to catch up. GPUs are the chips of choice for training AI models, and as the industry has grown, so have Nvidia’s revenues.
The chipmaker announced its first quarter 2025 (ending April 2024) earnings results on May 22, with revenue growth of 262% and operating profit up 690%. In the quarter, Nvidia experienced another period of higher AI chip sales, reflected in data center revenue growth of 427%.
Nvidia’s rise to the top of the chip market assured it a powerful role in AI that isn’t likely to go away anytime soon. Meanwhile, growth catalysts in other technology areas such as video games, PCs, self-driving cars and more could deliver profits for years to come.
Furthermore, despite the rising share price, Nvidia’s shares have actually increased in value over the past year. The company’s price-to-free cash flow ratio and price-to-earnings-growth ratio fell by double digits, suggesting Nvidia stock may be trading at its best value in months.
As a result, Nvidia is a millionaire-making stock that is simply too good to pass up, and has huge growth potential in the coming years.
2.Microsoft
While Nvidia dominates the hardware side of AI, Microsoft (NASDAQ: MSFT) a leading role in AI software. The tech giant was an early investor in the market, putting $1 billion into ChatGPT developer OpenAI in 2019. That investment has since grown to $13 billion, giving Microsoft exclusive access to some of the most advanced AI models in the industry.
Microsoft’s partnership with OpenAI has allowed it to drive multiple parts of its business with AI. Over the past year, the company has introduced new generative features to its Office productivity suite, expanded its library of AI tools on its Azure cloud platform, and even announced a venture into chip design. Microsoft has fully committed to AI, and its efforts are starting to reflect in its revenues.
In the third quarter of 2024 (which ended in March 2024), Microsoft’s revenues rose 17% year over year, while operating income rose 23%. The company’s intelligent cloud segment received a significant boost from AI, with revenue and operating profit increases of 21% and 32%, respectively.
Microsoft’s Azure has great growth potential in AI, as companies increasingly turn to cloud services to integrate the technology into their businesses. Azure has the second largest market share in the cloud at 25%, but is increasingly gaining ground as a market leader Amazon Web Services (AWS). In the fourth quarter of 2023, Azure’s cloud market share increased by 2 percentage points, while AWS’s decreased by 2 points.
Microsoft shares are up 224% since 2019, undoubtedly creating more than a few millionaires. Meanwhile, the rise of AI indicates that it is not ready yet. Shares in Microsoft aren’t the greatest value, with a price-to-earnings ratio of 36. However, the company’s dominant role in AI and finance makes the stock worth its premium price and a stock to consider before it’s too late is.
Should You Invest $1,000 in Nvidia Now?
Consider the following before buying shares in Nvidia:
The Motley Fool stock advisor The analyst team has just identified what they think is the 10 best stocks for investors to buy now… and Nvidia wasn’t one of them. The ten stocks that survived the cut could deliver monster returns in the coming years.
Think about when Nvidia created this list on April 15, 2005… if you had $1,000 invested at the time of our recommendation, you would have $746,217!*
Stock Advisor provides investors with an easy-to-follow blueprint for success, including portfolio building guidance, regular analyst updates and two new stock picks per month. The Stock Advisor is on duty more than quadrupled the return of the S&P 500 since 2002*.
View the 10 stocks »
*Stock Advisor returns June 10, 2024
John Mackey, former CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool’s board of directors. Dani Cook has no position in any of the stocks mentioned. The Motley Fool holds positions in and recommends Advanced Micro Devices, Amazon, Microsoft, and Nvidia. The Motley Fool recommends Intel and recommends the following options: long January 2025 calls of $45 on Intel, long January 2026 calls of $395 on Microsoft, short August 2024 calls of $35 on Intel, and short calls in January 2026 from $405 on Microsoft. The Motley Fool has a disclosure policy.
2 Millionaire-Maker Artificial Intelligence (AI) Stocks was originally published by The Motley Fool
