7 AI Stocks We’re Keeping Our Eye On In May 2025

AI stocks — and the AI industry — saw tremendous growth over the last year. That's left many investors wondering which AI companies to invest in to get some direct exposure to this rapid rise and blooming industry.

A few large companies, such as Palantir Technologies, have hogged much of the AI spotlight recently due to their massive spikes in value, and their valuations and performance have remained high even in the face of tariffs and broad market volatility. They continue to be represented in our list of the best AI stocks below, but there are many smaller, more obscure AI-related companies that have had substantial returns over the last year, too.

7 best AI stocks by performance

Here are the seven best-performing AI stocks in the Indxx Global Robotics & Artificial Intelligence Thematic Index and the Indxx Artificial Intelligence & Big Data Index, ordered by one-year returns. This list is updated weekly.

Source: Finviz. Data is current as of May 19, 2025, and is intended for informational purposes only.

More about these AI companies and what they do

1. Quantum Computing Inc. (QUBT)

Quantum Computing Inc., as its name implies, is a company that develops quantum computers, which use exotic small-scale physics phenomena to run computers that are much faster than conventional binary computers. It also operates a semiconductor foundry whose chips can be used in quantum computing applications. As a prominent developer of next-generation computer hardware, Quantum Computing Inc. may play an important role in future AI-related hardware innovation.

2. Palantir Technologies (PLTR)

Palantir is a software and big data analytics company whose Artificial Intelligence Platform (AIP) helps large organizations, such as the U.S. military, incorporate ChatGPT-style AI models into their networks. Its largest customers include the U.S. Department of Defense, as well as large companies such as Morgan Stanley and Merck & Co.

3. AppLovin Corp. (APP)

AppLovin is a software company that develops and markets mobile apps for corporate clients such as game studios. Its advertising services are provided by a proprietary AI model called Axon.

4. Faro Technologies (FARO)

Faro Technologies produces 3D measurement and imaging devices, as well as software, for use in industrial, architectural and public safety applications. According to Faro, the data collected by its measurement tools can help AI design applications and project management tools be more precise.

5. Tesla Inc. (TSLA)

You're probably familiar with Tesla. It's the most valuable automaker in the world, and a major developer of self-driving car technology, which uses various forms of AI. Tesla's owner, Elon Musk, also owns xAI, an AI research and development lab that competes with OpenAI and Anthropic and created the Grok series of AI chatbots.

6. Netflix Inc. (NFLX)

Netflix is the other household name on this list. It's the largest video streaming platform in terms of revenue in 2025, and a powerhouse of film and TV production. AI, for better or worse, plays an ever-growing number of roles in media production, such as special effects. What's more, Netflix has recently started to incorporate AI technology into aspects of its platform, such as the search feature.

7. SoundHound AI Inc. (SOUN)

SoundHound AI creates voice-based AI products, such as a voice assistant for restaurants that allows customers to place orders, ask about hours and create reservations. In addition to the food service industry, SoundHound creates products for the automotive and hospitality sectors as well. The company boasts an impressive client list, including Hyundai, Pandora, KrispyKreme, White Castle, Toast and Square.

What are AI stocks?

AI stocks are shares of companies that work in the artificial intelligence space or heavily utilize AI in their business operations. There are many applications for AI, and thus a large variety of AI stocks: Some AI companies create voice recognition software. Others create pilotless aircraft.

According to Haydar Haba, the founder of Andra Capital, a venture capital firm that invests in AI companies, there are several publicly traded companies that have substantial AI interests and are poised to benefit from the growth of the industry.

AI stocks tend to fall into one of two categories: blue-chip technology companies that have invested in or partnered with AI developers, and small, experimental companies that are completely focused on AI development.

Shares of small AI developers might seem like the most “direct” investments in AI, but Michael Brenner, a research analyst who covers AI for FBB Capital Partners, says they’re not necessarily the best AI investments.

“Large language models require a tremendous amount of data and a huge amount of capital to put together,” Brenner says.

Brenner notes that small companies may develop innovative new models on their own, but eventually they will have to partner with a bigger company that has more infrastructure in order to run those models at a commercial scale.

“So far, we’re sticking with more of the mega-cap tech companies,” Brenner says, referring to FBB Capital Partners’ AI portfolio.

How to invest in AI stocks

If you're very new to stock trading and want to invest in AI stocks, the first step is to open and fund a brokerage account.

From there you'll need to decide what kind of AI stock exposure you want, and which AI companies you want to invest in. Individual AI stocks can potentially offer high returns, but require taking on a lot of risk and research work. Most brokerage firms will offer stock screeners to help you find stocks that meet your needs and investment goals, but you'll still want to dig into the fundamentals of the company. Some AI companies are fairly new, making this task particularly tricky — and investing in them potentially more risky.

For those reasons, some investors — particularly long-term investors who aren't interested in active stock trading — invest in AI stocks via pooled exchange-traded funds that focus on AI.

How to find AI ETFs

Exchange-traded funds invest in a basket of companies — in this case, companies that are involved in AI development and implementation. ETFs typically track a market index that aligns with their investment objectives and scope.

There are several AI stock indexes — like the Indxx Global Robotics & Artificial Intelligence Thematic Index, which we use to build our list above, and the Nasdaq CTA Artificial Intelligence & Robotics Index — that are tracked by ETFs.

You can also find AI ETFs in an ETF screener by searching for “artificial intelligence,” “machine learning” or “AI,” but make sure to thoroughly research any ETF you find this way.

Some ETFs that have “AI” in their name invest in AI-linked companies. But others are diversified ETFs that use AI-powered trading, and are not necessarily invested in AI stocks.

» We've done the work for you: Check our list of the best AI ETFs

Could we be in an AI bubble?

It depends on who you ask. According to some analysts, we are not in an AI bubble^[0]

Haba says that there are some signs investors may be overenthusiastic about the potential of AI right now.

“AI has been used as a buzzword to drive share price premiums, but companies have not always demonstrated usage of cutting-edge techniques,” he said.

“In the private markets, we are seeing hundreds of millions of dollars flow into ‘AI’ companies that have no product market fit. While investors are justifying such investments based on growth potential, it remains unclear whether that potential can or will ever be monetized,” Haba says.

Brenner also acknowledges that some individual AI-linked companies have seen their valuations increase sharply without a big change in their business fundamentals.

However, Brenner doesn’t think that the current surge of interest in AI amounts to a bubble, because many indexes of technology stocks are still below their previous highs.

“At macro-level, it’s hard to say we’re in a bubble, because we’re not at an all-time high,” Brenner says.

One thing for sure is that tech stocks account for a high market capitalization. In other words, tech stocks may be occupying a greater percentage of your portfolio than in previous years. This can make portfolios riskier in the event that we are in an AI bubble.

Is OpenAI on the stock market?

Not quite. As a nonprofit AI development lab, OpenAI isn't a publicly-traded company, but OpenAI shares are available to certain kinds of investors on certain pre-IPO marketplaces. There are also publicly-traded investment funds that have exposure to OpenAI, and the organization partners with several large tech companies, such as Microsoft, that anyone can invest in.

» More on investing in OpenAI: Can you buy OpenAI stock?

Should you invest in AI stocks?

Investors should think carefully before buying individual stocks or narrowly focused ETFs. Targeted investments can be riskier than broad investments, such as S&P 500 index funds, which have a long-term average annual return, not accounting for inflation, of about 10%.

One guideline that can help limit that extra risk is to devote no more than 10% of your overall portfolio to individual stocks.

But if you’re financially secure enough to buy individual stocks, Brenner says AI stocks are worth considering.

“I think retail investors should be thinking about how machine learning is going to impact the stocks they own,” he says.

“For individual investors looking at individual stocks in their 401(k)s, if they can weather the volatility of individual stocks, investing in AI-related companies as part of a diversified portfolio could make sense,” Brenner says.