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Nvidia and Taiwan Semiconductor are providing computing power to the AI hyperscalers.
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Amazon and Alphabet have thriving cloud computing businesses thanks to the AI arms race.
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Meta Platforms has acquired top AI talent -- at top dollar -- to lead its AI evolution.
Buying artificial intelligence (AI) stocks after the run they've had over the past few years may seem silly. However, the reality is that many of these companies are still experiencing rapid growth and anticipate even greater gains on the horizon.
By investing now, you can get in on the second wave of AI investing success before it hits. While it won't be nearly as lucrative as the first round that occurred from 2023 to 2024, it should still provide market-beating results, making these stocks great buys now.
The demand for AI computing power appears to be insatiable. All of the AI hyperscalers are spending record amounts on building data centers in 2025, but they're also projecting to top that number in 2026. This bodes well for companies supplying products to fill those data centers with the computing power needed for processing AI workloads.
Two of my favorites in this space are Nvidia (NASDAQ: NVDA) and Taiwan Semiconductor Manufacturing (NYSE: TSM). Nvidia makes graphics processing units (GPUs), which have been the primary computing muscle for AI workloads so far. Thousands of GPUs are connected in clusters due to their ability to process multiple calculations in parallel, creating a powerful computing machine designed for training and processing AI workloads.
Inside these GPUs are chips produced by Taiwan Semiconductor, the world's leading contract chip manufacturer. TSMC also supplies chips to Nvidia's competitors, such as Advanced Micro Devices, so it's playing both sides of the arms race. This is a great position to be in, and it has led to impressive growth for TSMC.
Both Taiwan Semiconductor and Nvidia are capitalizing on massive data center demand, and have the growth to back it up. In Q2 FY 2026 (ending July 27), Nvidia's revenue increased by 56% year over year. Taiwan Semiconductor's revenue rose by 44% in its corresponding Q2, showcasing the strength of both of these businesses.
With data center demand only expected to increase, both of these companies make for smart buys now.
The AI hyperscalers are companies that spend a significant amount of money on AI computing capacity for internal use and to provide tools for consumers. Three major players in this space are Amazon (NASDAQ: AMZN), Alphabet (NASDAQ: GOOG) (NASDAQ: GOOGL), and Meta Platforms (NASDAQ: META).