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The adoption of AI tools in the cybersecurity market is increasing at a healthy pace, and Zscaler is building a solid revenue pipeline thanks to this technology.
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AI chips are in great demand, which makes Micron Technology a terrific buy considering its phenomenal pace of growth.
Artificial intelligence (AI) stocks turned out to be big winners for investors in the past few years as the proliferation of this technology has allowed several companies to unlock new growth avenues, helping them boost their revenue and earnings at a healthy pace.
The good part is that AI adoption still has a long way to go. That's not surprising as companies using generative AI solutions are reportedly witnessing a return of 3.7 times for every dollar they spent on this technology. With the global economy expected to get a 15% boost thanks to AI in the long run, the adoption of this technology is likely to gain more momentum.
That's why it would be a good idea to take a closer look at two AI stocks benefiting from improving AI adoption in different industries and that seem well placed to deliver healthy gains to investors in the long run.
The cybersecurity-focused AI market is expected to grow by almost fourfold by 2030, generating $94 billion in annual revenue at the end of the decade. Zscaler (NASDAQ: ZS) gives investors an opportunity to capitalize on this opportunity.
The company is not only integrating AI-powered tools into its cybersecurity platform, but is also offering services that can help organizations secure their AI assets. The good part is that Zscaler's AI services are gaining solid traction among customers. This is evident from the fact that 27% of the new business that the company got in fiscal 2025 was from its emerging products.
These emerging products include several AI-focused tools, which help secure large language models (LLMs) and applications and give organizations access to AI virtual assistants to simplify their cybersecurity operations. It recently launched Zscaler AI Guard, a platform that's supposed to "stop attacks, protect sensitive data, and ensure regulatory compliance, enabling businesses to adopt AI securely."
The improving demand for Zscaler's AI tools is the reason why the company reported a solid set of results recently. Zscaler's revenue for the fourth quarter of fiscal 2025 (which ended on July 31) increased 21% year over year to $719 million. Its non-GAAP net income jumped by almost 24%. The company ended the year with a 26% increase in adjusted earnings to $3.28 per share.