3 U.S. AI stocks with high profitability and profit growth

AI is no longer just a story about experimentation and cash burn. Companies are increasingly turning large investments into AI into real returns. With inflation, interest rates, and energy prices all in the spotlight, many investors are looking for companies that already know how to turn their AI spending into profits, not promises. The Profitable AI Stocks screening tool is built for this purpose, highlighting companies that are not only serious about AI, but are also making money from it. This article describes three leading candidates from the screener and how they fit into the current macro context.

Nvidia (NVDA)

overview: NVIDIA is a Santa Clara-based chip and software company that designs powerful graphics processors and data center AI hardware, as well as the CUDA software ecosystem on which many AI applications run, serving customers in the gaming, cloud computing, and automotive markets around the world.

operation: NVIDIA generates US$25.1 billion from graphics and US$228.4 billion from computing and networking, including US$187.7 billion from the United States, US$46.7 billion from Taiwan, US$14.6 billion from China (including Hong Kong), and US$4.5 billion from other countries.

Market capitalization: 5,103 billion USD

Investors looking at profitable AI leaders will be watching to see how NVIDIA combines high growth expectations with already strong earnings quality. With revenue growth of 21.8% and revenue growth of 24.6% expected, the company is currently forecasting very high return on equity and a net margin of 63%, supported by its CUDA software moat and increased data center demand tied to platforms such as Vera Rubin, Vera CPU, and DSX AI infrastructure stack. At the same time, the story is fraught with risks due to heavy insider selling, reliance on risky external funding, and policy pressures around AI chips and power-hungry data centers. A key consideration for investors is how these strengths and pressures will be balanced in the next phase of NVIDIA’s AI buildout.

NVIDIA’s revenue stream puts it ahead of many AI competitors, but the real question is how long that advantage can last. See the complete story with 4 major rewards and 2 important warning signs (1 is important!).

Astera Research Institute (ALAB)

overview: Astera Labs is a San Jose-based semiconductor company that builds high-speed connectivity chips and software that link AI accelerators, servers, and memory in cloud data centers, enabling large-scale AI workloads to move large amounts of data quickly and reliably.

operation: Astera Labs currently generates approximately US$1 billion in revenue from its semiconductor division alone.

Market capitalization: $71.5 billion

At Astera Labs, you can focus on plumbing AI data centers with PCIe, CXL, Ethernet, and Scorpio smart fabric switches, and increase the amount per AI rack based on the size of your deployment. Revenue is growing very quickly and profitability is good, with a net profit margin of 26.7%. Additionally, its inclusion in the Nasdaq 100, along with partnerships with companies such as NVIDIA, AMD, and leading hyperscalers, demonstrate how central the company’s connectivity platform is in building AI infrastructure. At the same time, rich valuations, concentrated hyperscaler demand, stock price volatility, insider selling, and increased funding risk all mean expectations are high. A key consideration is whether Astera Labs’ product enhancements and open standards efforts are sufficient to justify its expectations over time.

Astera Labs is at a place where many expectations align with actual returns, but the bigger picture is often overlooked. See how growth, hyperscaler dependence, and valuation tensions interact in two major rewards and two key warning signs.

Palantir Technologies (PLTR)

overview: Palantir Technologies builds software platforms such as Gotham, Foundry, Apollo and its artificial intelligence platform to help government and commercial customers collect, analyze, and turn vast amounts of data into decisions and actions for everything from defense and security use cases to enterprise operations.

operation: Palantir Technologies generates approximately US$2.8 billion from the government sector and US$2.5 billion from corporate customers, with most of its revenue coming from the US, with some contributions from the UK and other countries.

Market capitalization: USD 308 billion

Palantir Technologies stands out in our screening of profitable AI stocks. That’s because the company is already making a lot of money from its AI-powered software, with current net profit margins of over 40%, revenue growth of about 32%, and projected revenue growth of about 31%. The company’s balance sheet has no debt and a significant amount of cash, and recent partnerships, including an expanded Google Cloud contract and new AIP rollouts with companies such as Kirkland & Ellis, mark an expansion of its commercial footprint in parallel with years of government initiatives. The flip side is rich valuations, vocal skepticism, public sector scrutiny such as the debate over Britain’s NHS contract, and insider selling. A key consideration for investors is whether Palantir’s AI platform justifies paying a premium for its combination of growth, profitability, and controversy.

Palantir’s combination of high growth, strong profitability, and no debt makes it seem like an outlier in AI, but the real story lies in how those characteristics influence its valuation and controversy. Get the full context with Palantir Technologies’ analysis report

These three stocks are just a starting point. In the complete Profitable AI Stocks screener, the Profitable AI Stocks screener shows approximately 60 companies with similarly compelling revenue-driven AI narratives. Use Simply Wall St to identify and analyze the most important specific catalysts, cash-generating profiles, and AI investing stories, allowing you to focus on the highest-conviction ideas in the space.

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This article by Simply Wall St is general in nature. We provide commentary using only unbiased methodologies, based on historical data and analyst forecasts, and articles are not intended to be financial advice. This is not a recommendation to buy or sell any stock, and does not take into account your objectives or financial situation. We aim to provide long-term, focused analysis based on fundamental data. Note that our analysis may not factor in the latest announcements or qualitative material from price-sensitive companies. Simply Wall St has no position in any stocks mentioned.

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