Even though 2024 is coming to an end and a new year full of surprises is just around the corner, artificial intelligence (AI) will certainly remain a top priority for investors next year.
While Nvidia is widely considered the ultimate barometer for the health of the AI ecosystem, I see a few other candidates as top investment choices for 2025.
Advanced micro devices (NASDAQ: AMD), Amazon (NASDAQ: AMZN)And Tesla (NASDAQ: TSLA) There are opportunities to buy hand over fist next year as the AI mania continues.
Industry trends suggest that Nvidia owns a staggering amount 88% share of the GPU market. On the surface, such a strong position might indicate that Nvidia simply has the most superior products on the market. While some customers argue that this is very much the case, there is a more nuanced reason for Nvidia’s dominance: a lack of competition over the past two years has actually given Nvidia a first-mover advantage.
Over the past year, however, AMD has quietly emerged as a formidable competitor in the data center GPU space, thanks in large part to its MI300 accelerators. The MI300 has been such a game changer for AMD that its own data center services business is essentially growing at the same pace as Nvidia’s (which has declined in recent quarters).
Next year, AMD will release a next-generation architecture called the MI325X, which aims to compete with Nvidia’s new Blackwell GPUs. Additionally, AMD’s GPU roadmap also includes a planned 2026 launch for its MI400 chipset, which is likely an answer to Nvidia’s Rubin architecture, which is also planned for 2026.
While I’m not insinuating that AMD will become a bigger company than Nvidia, the company’s pace of innovation deserves recognition. With that, I could easily see AMD starting to gain more and more market share away from Nvidia, as investment in AI infrastructure continues to grow.
AMD is a screaming buy right now as investors seem to be ignoring the company’s progress, which is currently overshadowed by Nvidia’s.
Amazon as the most lucrative opportunity among megacap tech. While Amazon’s core businesses lie between e-commerce and cloud computing, the company also has a subscription business (Prime), a streaming platform, and a fast-growing advertising unit. Amazon is an incredibly unique company because its diverse model allows it to integrate AI-powered features into the broader fabric of the business.
Between holiday-related shopping trends, corporate budgets moving more toward AI, and new investments in its streaming services, Amazon appears poised for a stellar fourth-quarter performance. Additionally, the company is making some notable investments in AI infrastructure – namely in the form of homegrown chips (Trainium and Inferentia) and through a lucrative partnership with rival OpenAI. Anthropic.