Here's how you can get your share of the AI gold rush.
The artificial intelligence (AI) boom is set to create wealth for savvy investors. Here, we profile two innovative AI leaders delivering wealth-building benefits to shareholders.
#1 AI Stock to Buy: SoundHound AI
SoundHound AI's (SOUN 2.03%) cutting-edge voice technology can interpret conversations in a similar way to the human brain, and as businesses rush to harness the power of this groundbreaking technology, the company's conversational AI delivers a faster, more accurate experience than competing platforms.
Restaurants are using SoundHound AI's tools to create custom voice assistants. The company's smart response and ordering solution eliminates wait times for customers by handling multiple orders simultaneously. The technology also improves profitability by allowing restaurants to handle more orders and reduce labor costs. Customers include Papa John's, Casey's, and Chipotle.
Automotive giants are also racing to adopt SoundHound's technology. A pioneer in voice AI, the company's voice recognition software is integrated with generative AI models such as OpenAI's ChatGPT. A wealth of real-time information, including navigation, weather and maintenance updates, is easily accessible via hands-free control. Leading automakers such as Mercedes-Benz, Stellantis and Honda are among SoundHound's growing list of customers.
Meanwhile, SoundHound's sales are growing at a rapid clip: The company's second-quarter revenue rose 54% year over year to $13.5 million.
As the small business continues to scale, profitability should improve. SoundHound's recent acquisition of enterprise AI software provider Amelia should help in this regard, as management expects the acquisition to be accretive to SoundHound's revenue by the second half of 2025.
#2 AI Stock to Buy: Advanced Micro Devices
Nvidia (NVDA 4.55%) AI chips are selling like hotcakes. So much so that semiconductor designers are struggling to meet surging demand for the increasingly important technology. That shortage has kept prices high and slowed many companies' AI plans. Chip buyers are clearly looking to boost supply. They're eager for a new Nvidia competitor, and Advanced Micro Devices (AMD 2.16%) could be up to the task.
AMD's data center revenue grew 115% to $2.8 billion in the second quarter, boosted by strong sales of the company's new AI accelerators that speed up machine learning workloads.
CEO Lisa Su predicts that AMD's new AI chip revenue will surge to more than $4.5 billion in 2024. But the chipmaker is only scratching the surface of the long-term market opportunity: Su predicts that global AI chip sales will grow to a staggering $400 billion by 2027.
Analysts at Piper Sandler & Co. say AMD could capture 20% of this fast-growing market by 2028. Big chip buyers such as Microsoft and Meta Platforms are reportedly planning to integrate AMD's AI accelerators into their cloud-computing operations.
Like SoundHound, AMD is also making acquisitions to strengthen its competitive position and accelerate its expansion. The technology leader completed its acquisition of Silo AI for $665 million on August 12. Europe's largest private AI research lab is home to a team of experienced scientists and engineers that will strengthen AMD's model and software development efforts.
Just days later, AMD closed a deal to acquire ZT Systems for $4.9 billion, an AI infrastructure provider that should bolster AMD's ability to design and deploy large-scale cloud computing systems for customers.
Randi Zuckerberg, former director of market development and communications at Facebook and sister of Meta Platforms CEO Mark Zuckerberg, is a member of The Motley Fool's board of directors. Joe Tenebruso has no position in any of the stocks mentioned. The Motley Fool owns shares of and recommends Advanced Micro Devices, Chipotle Mexican Grill, Meta Platforms, Microsoft, and Nvidia. The Motley Fool recommends Casey's General Stores and Stellantis and recommends buying Microsoft's January 2026 $395 calls, selling Microsoft's January 2026 $405 calls, and selling Chipotle Mexican Grill's September 2024 $52 puts. The Motley Fool has a disclosure policy.
