Best AI Stocks to Watch in 2026: NVIDIA, Microsoft, and Palantir Lead

TLDR

• NVIDIA holds 80% of the AI chip market with its H100 and H200 GPUs becoming the standard for training large language models
• Microsoft’s OpenAI partnership has generated over $100 million in annual recurring revenue from GitHub Copilot alone
• Alphabet’s Gemini AI models now compete directly with GPT-4, backed by proprietary data from Search, YouTube, and Android
• Palantir’s Artificial Intelligence Platform (AIP) has accelerated U.S. commercial revenue growth significantly
• CrowdStrike processes trillions of security events weekly using AI to detect threats in real-time, maintaining retention rates above 120%

The artificial intelligence sector has moved past initial hype into real commercial use. Companies across different market sizes now offer investors practical ways to access this growth.

These five stocks span from chip manufacturers to enterprise software providers. Each has built real revenue from AI products rather than relying only on market enthusiasm.

NVIDIA: The AI Chip Powerhouse

NVIDIA controls roughly 80% of the AI chip market. The company’s H100 and H200 graphics processing units have become industry standards for training large language models.

NVIDIA Corporation, NVDA

The upcoming Blackwell architecture promises additional performance improvements. NVIDIA has built strong defenses through its CUDA software platform, which developers use as the standard for AI development.

Major cloud providers including Microsoft, Amazon, and Google continue purchasing NVIDIA chips to build their AI capabilities. The company is also expanding into AI inference chips and forming new data center partnerships.

Microsoft: Integrated AI Across Products

Microsoft has integrated AI across its entire product line. The company invested $13 billion in OpenAI, which has produced measurable results.

Microsoft Corporation, MSFT

GitHub Copilot now generates over $100 million in annual recurring revenue. Microsoft 365 Copilot is gaining adoption among enterprise customers despite higher pricing.

Azure cloud services are growing faster due to AI features. The company earns money from both infrastructure through Azure and applications through its productivity software.

This dual revenue approach creates multiple ways to profit from AI adoption. Both developers and business users contribute to Microsoft’s AI growth.

Alphabet: Deep Research Meets Vast Data

Alphabet owns DeepMind and Google Brain, giving it deep AI research capabilities. The company’s Gemini models now compete with GPT-4 in performance.

Alphabet controls vast amounts of data from Search, YouTube, and Android. This data creates training datasets that competitors cannot access.

Google Cloud is seeing renewed growth as businesses adopt its Vertex AI platform. The company is carefully adding AI features to Search while protecting its advertising revenue.

Alphabet trades at a lower price than Microsoft despite having similar AI capabilities. This pricing gap makes it attractive for long-term investors.

Palantir: Enterprise AI Solutions

Palantir has become a leading enterprise AI platform for companies with complex data needs. The company’s Artificial Intelligence Platform has driven strong growth in U.S. commercial revenue.

Palantir solves the “last mile” problem that stops many AI projects from being used in production. The company helps organizations use AI within their existing workflows.

Government contracts provide steady revenue while commercial expansion offers faster growth. The customer base is expanding and business economics are improving.

The platform focuses on operationalizing AI rather than just providing tools. This approach resonates with large organizations that need practical implementation.

CrowdStrike: AI-Powered Security

CrowdStrike approaches AI from a cybersecurity angle. The company’s Falcon platform uses AI and machine learning to detect threats as they happen.

The system processes trillions of security events each week to find unusual patterns. As criminals use AI for attacks, CrowdStrike’s AI-based defense becomes more valuable.

The company maintains customer retention rates above 120%. It continues to be profitable and is adding new platform features.

CrowdStrike offers a lower-risk way to invest in AI infrastructure compared to newer companies. The cybersecurity focus provides business stability beyond pure AI applications.

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