Artificial intelligence (AI) has become one of the most disruptive technologies in recent years, delivering productivity improvements across several industries.
Consulting giant PwC predicts that the adoption of AI could increase global gross domestic product (GDP) by 15 percentage points by 2035. According to other estimates, AI market revenue could soar from just $274 billion in 2023 to a whopping $5.3 trillion in 2035. There are several ways investors can take advantage of the significant growth in the AI market.
Let’s take a closer look at the outlook for taiwan semiconductor manufacturing (TSM +0.42%) and Palantir Technologies (PLTR 1.65%)two companies that play a central role in key niche areas of the AI market. These may be the only two AI stocks you need to buy and hold for the next 10 years.
Image source: TSMC.
TSMC is the main player in AI chips
All types of AI hardware, from data centers to smartphones, computers, robots, and self-driving cars, require semiconductors to function. After all, the chips used in these applications allow them to perform the computations needed to run AI models and inference solutions. Simply put, AI devices cannot function without semiconductors, which are now considered the new oil.
taiwan semiconductor manufacturing
Today’s changes
(0.42%) $1.40
current price
$338.11
Key data points
Market capitalization
$1.8 trillion
daily range
$336.23 – $344.47
52 week range
$134.25 – $390.20
volume
562K
average volume
13M
gross profit
58.73%
dividend yield
0.91%
The rise of AI explains why global semiconductor market revenue is expected to more than triple to just under $2.8 trillion over the next decade. TSMC is one of the best semiconductor stocks you can buy to take advantage of this huge opportunity. That’s because the company is a go-to maker of chips that power AI applications.
It makes chips for AI data center giants such as. Nvidia and broadcomfor personal computer chip designers such as AMD and inteland smartphone-based players, etc. apple, QualcommMediatech. It’s worth noting that TSMC manufactured chips for a whopping 534 customers last year and produced nearly 13,000 products for customers across multiple applications.
Not surprisingly, TSMC expects revenue from sales of AI accelerators to register a compound annual growth rate (CAGR) of mid-to-high 50% through 2029. We expect overall revenue to grow at a CAGR of 25% over the same period. Long-term opportunities in the semiconductor market should allow TSMC to maintain healthy growth over the next decade. Especially considering that TSMC is the No. 1 foundry producing chips for third parties with an estimated market share of 72%.
The points discussed above explain why analysts are bullish on TSMC’s prospects and have recently raised their earnings estimates, and with long-term growth in the semiconductor market, this trend should continue in the future.
Data by YCharts.
That’s why investors looking to buy AI stock now and hold it for the long term should pay attention to TSMC stock, which trades at an attractive forward P/E of 26x.
Palantir Technologies helps customers reap the benefits of AI with software solutions
While TSMC’s hardware provides the basic building blocks that enable AI model training and inference, Palantir provides the software platform that enables end customers to deploy generative AI into their operations. Palantir’s Artificial Intelligence Platform (AIP), introduced in April 2023, has been a huge success.
Today’s changes
(-1.65%) $-2.54
current price
$150.96
Key data points
Market capitalization
$361 billion
daily range
$148.59 – $154.55
52 week range
$66.12 – $207.52
volume
1.8M
average volume
49M
gross profit
82.37%
The platform enables customers to integrate data with large-scale language models to automate processes, improve decision-making with real-time data, and develop AI applications and agents. As a result, Palantir’s customer count and transaction size have increased dramatically since implementing AIP.
The company had 954 customers at the end of 2025, an increase of 34% year over year. The number of transactions valued at $1 million or more reached 180, a significant increase compared to the 55 similar transactions in the last quarter of 2022 (prior to the introduction of AIP). The number of transactions over $10 million jumped 12x during this period, a clear indication that customers are flocking to Palantir because of the benefits AIP brings.
Strong growth in Palantir’s customer base and increased transaction size resulted in outstanding transaction value (the amount of contracts fulfilled at the end of each quarter) of $11.2 billion at the end of 2025, a threefold increase from the end of 2022. This impressive growth has led to significant increases in Palantir’s revenue and profits in recent years.
Data by YCharts.
The AI software platform market is expected to grow at a CAGR of 29% until 2034. Generating impressive revenues of $237 billion at the end of the forecast period, Palantir is well-positioned to maintain its impressive growth rate over the next decade. Moreover, the company is growing at a faster pace than the AI software platform market, which can be attributed to its position as a leader in this industry.
So investors looking for a company that has the potential to take advantage of the growth in the AI software market over the next decade may want to consider Palantir stock for their portfolio.
