The artificial intelligence (AI) market has exploded since the beginning of last year, creating many billionaires. The huge potential of this technology and its ability to fuel countless industries has led investors to be bullish on almost every company that has entered the AI space. In fact, Nasdaq 100 The technology sector has surged 35% since last June, driven mainly by hopes for AI.
Despite the industry's rapid growth, far from plateauing, AI is likely to create even more billionaires in the coming years. According to data from Grand View Research, AI market spending is projected to reach nearly $200 billion in 2023 and just under $2 trillion by the end of the decade as the sector expands at a compound annual growth rate of 37%.
As a result, it may be worth investing in some of AI's most powerful players and benefiting from the market's long-term growth. Here are two millionaire-making artificial intelligence stocks that may be worth buying in June.
1. NVIDIA
Companies that have benefited from the AI boom include: NVIDIA (NASDAQ: NVDA)The company's shares have soared 223% since last June as it took an estimated 90% market share in AI chips.
Nvidia's long-standing dominance of the graphics processing unit (GPU) market has paved the way for the company to lead the way in AI, but Advanced Micro Devices and Intel The company scrambled to catch up: GPUs are the chips of choice for training AI models, so as the industry grew, so did Nvidia's revenue.
The chipmaker released its financial results for the first quarter of 2025 (ended April 2024) on May 22, reporting a 262% increase in revenue and a 690% increase in operating profit. During the quarter, Nvidia saw sales of AI chips increase again, reflected in a 427% increase in data center revenue.
Nvidia's rise to the top of the chip market has secured it a strong role in AI that's unlikely to disappear anytime soon, while growth drivers in other tech sectors like video games, PCs and self-driving cars could benefit it for years to come.
Moreover, despite the stock price surge, Nvidia's stock is actually more expensive than it has been in the last year. The company's price-to-free cash flow ratio and price-to-earnings growth ratio are down double digits, suggesting that Nvidia's stock may be trading at its highest price in months.
As a result, Nvidia is a millionaire-making stock you can't miss, with huge growth potential over the next few years.
2. Microsoft
Nvidia has the hardware advantage in AI, Microsoft (Nasdaq: MSFT) It has played a leading role in AI software: The tech giant was an early investor in the market, pumping $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 helped it power many parts of its AI business. In the last year, the company introduced new generation capabilities to its Office productivity suite, expanded its library of AI tools on its cloud platform Azure, and even announced its foray into chip design. Microsoft is committed to AI, and that commitment is starting to show in its bottom line.
Microsoft's revenue grew 17% year over year in the third quarter (ending March 2024), and its operating profit increased 23%. The company's Intelligent Cloud division saw strong growth from AI, with revenue and operating profit increasing 21% and 32%, respectively.
Microsoft's Azure has huge growth potential in the AI space as companies increasingly turn to cloud services to integrate AI technology into their businesses. Azure is No. 2 in the cloud market share with 25%, but is behind industry leader Amazon Web Services (AWS): In Q4 2023, Azure's cloud market share increased by 2 percentage points, while AWS's decreased by 2 percentage points.
Microsoft shares have risen 224% since 2019, undoubtedly creating several billionaires in the process. Meanwhile, the emergence of AI shows that it's not over yet. Microsoft stock is not the most valuable, trading at 36 times forward earnings. However, given the company's dominant role in AI and financial resources, the company's stock is worth the premium price and is a stock to consider before it's too late.
Should I invest $1,000 in Nvidia right now?
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John Mackey, former CEO of Amazon subsidiary Whole Foods Market, is a director of The Motley Fool. Dani Cook has no position in any of the stocks mentioned. The Motley Fool owns shares of and recommends Advanced Micro Devices, Amazon, Microsoft, and NVIDIA. The Motley Fool recommends Intel and recommends the following: long January 2025 $45 calls on Intel, long January 2026 $395 calls on Microsoft, short August 2024 $35 calls on Intel, and short January 2026 $405 calls on Microsoft. The Motley Fool has a disclosure policy.
The article 2 Artificial Intelligence (AI) Stocks That Will Make You Millionaires was originally published by The Motley Fool.
