Key Points

• Nvidia and AMD should continue to be AI infrastructure winners.

• Alphabet and Pinterest are using AI to drive advertising revenue growth.

• Salesforce is looking to create an AI agent workforce.

• 10 stocks we like better than Nvidia ›

While there is still uncertainty surrounding the implementation of tariffs by the Trump administration, at least one sector -- artificial intelligence (AI) -- is starting to regain its momentum and could be set up for another bull run. The technology is being hailed as a once-in-a-generation opportunity, and the early signs are that this could indeed be the case.

With AI still in its early innings, it's not too late to invest in the sector. Let's look at five AI stocks to consider buying right now.

Where to invest $1,000 right now? Our analyst team just revealed what they believe are the 10 best stocks to buy right now. Learn More »

Nvidia

Nvidia's (NASDAQ: NVDA) stock has already seen massive gains the past few years, but the bull case is far from over. The company's graphics processing units (GPUs) are the main chips used for training large language models (LLMs), and it's also seen strong traction in inference. These AI workloads both require a lot of processing power, which its GPUs provide.

The company captured an over 90% market share in the GPU space last quarter, in large thanks to its CUDA software platform, which makes it easy for developers to program its chips for various AI workloads. In the years following its launch, a collection of tools and libraries have also been built on top of CUDA that helps optimize Nvidia's GPUs for AI tasks.

With the AI infrastructure buildout still appearing to be in its early stages, Nvidia continues to look well-positioned for the future. Meanwhile, it has also potential big markets emerging, such as the automobile space and autonomous driving.

AMD

While Nvidia dominates AI training, Advanced Micro Devices (NASDAQ: AMD) is carving out a space in AI inference. Inference is the process in which an AI model applies what it has learned during training to make real-time decisions. Over time, the inference market is expected to become much larger than the training market due to increased AI usage.

AMD's ROCm software, meanwhile, is largely considered "good enough" for inference workloads, and cost-sensitive buyers are increasingly giving its MI300 chips a closer look. That's already showing up in the numbers, with AMD's data center revenue surging 57% last quarter to $3.7 billion.

Even modest market share gains from a smaller base could translate into meaningful top-line growth for AMD. Importantly, one of the largest AI model companies is now using AMD's chips to handle a significant share of its inference traffic. Cloud giants are also using AMD's GPUs for tasks like search and generative AI. Beyond GPUs, AMD remains a strong player in data center central processing units (CPUs), which is another area benefiting from rising AI infrastructure spend.

Taken altogether, AMD has a big AI opportunity in front of it.

Alphabet

If you only listened to the naysayers, you would think Alphabet (NASDAQ: GOOGL) (NASDAQ: GOOG) is an AI loser, whose main search business is about to disappear. However, that would ignore the huge distribution and ad network advantages the company took decades to build.

Meanwhile, it has quietly positioned itself as an AI leader. Its Gemini model is widely considered one of the best and getting better. It's now helping power its search business, and it's added innovative elements that can help monetize AI, such as "Shop with AI," which allows users to find products simply by describing them; and a new virtual try-on feature.

Google Cloud, meanwhile, has been a strong growth driver, and is now profitable after years of heavy investment. That segment grew revenue by 28% last quarter and continues to win share in the cloud computing market. The company also has developed its own custom AI chips, which OpenAI recently began testing as an alternative to Nvidia.

Alphabet also has exposure to autonomous driving through Waymo, which now operates a paid robotaxi service in multiple cities, and quantum computing with its Willow chip.

Alphabet is one of the world's most innovative companies and has a long runway of continued growth still in front of it.

Pinterest

Pinterest (NYSE: PINS) has leaned heavily into AI to go from simply an online vision board to a more engaging platform that is shoppable. A key part of its transformation is its multimodal AI model that is trained on both images and text. This helps power its visual search feature, as well as generate more personalized recommendations. Meanwhile, on the backend, its Performance+ platform combines AI and automation to help advertisers run better campaigns.

The strategy is working, as the platform is both gaining more users and monetizing them better. Last quarter, it grew its monthly active users by 10% to 570 million. Much of that user growth is coming from emerging markets. Through the help of Google's strong global ad network, with whom it's partnered, Pinterest is also much better at monetizing these users. In the first quarter, its "rest of world" segment's average revenue per user (ARPU) jumped 29%, while overall segment revenue soared 49%.

With a large but still undermonetized user base, Pinterest has a lot of growth ahead.

Salesforce

Salesforce (NYSE: CRM) is no stranger to innovation, being one of the first large companies to embrace the software-as-a-service (SaaS) model. A leader in customer relationship management (CRM) software, the company is now looking to become a leader in agentic AI and digital labor.

Salesforce's CRM platform was built to give its users a unified view of their siloed data all in one place. This helped create efficiencies and reduce costs by giving real-time insights and allowing for improved forecasting.

With the advent of AI, it is now looking to use its platform to create a digital workforce of AI agents that can complete tasks with little human supervision. It believes that the combination of apps, data, automation, and metadata into a single framework it calls ADAM will give it a leg up in this new agentic AI race.

The company has a huge installed user base, and its new Agentforce platform is off to a good start with over 4,000 paying customers since its October launch. With its consumption-based product, the company has a huge opportunity ahead with AI agents.

Should you invest $1,000 in Nvidia right now?

Before you buy stock in Nvidia, consider this:

The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Nvidia wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years.

Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you’d have $694,758!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $998,376!*

Now, it’s worth noting Stock Advisor’s total average return is 1,058% — a market-crushing outperformance compared to 180% for the S&P 500. Don’t miss out on the latest top 10 list, available when you join Stock Advisor.

See the 10 stocks »

*Stock Advisor returns as of July 7, 2025

Suzanne Frey, an executive at Alphabet, is a member of The Motley Fool's board of directors. Geoffrey Seiler has positions in Alphabet, Pinterest, and Salesforce. The Motley Fool has positions in and recommends Advanced Micro Devices, Alphabet, Nvidia, Pinterest, and Salesforce. The Motley Fool has a disclosure policy.

Key Points

• While Tesla has talked a big game about its Optimus robot, Amazon just deployed its 1 millionth robot at its fulfillment centers.

• The company's robots are using AI to help make the company's warehouse operations much more efficient.

• Meanwhile, it's also using AI in areas like delivery and inventory management.

Tesla (NASDAQ: TSLA) gets most of the media attention when it comes to robotics, thanks to its humanoid robot prototype, Optimus, and Elon Musk's bold claims. In fact, last year Musk said that Optimus could eventually be worth more than everything else from Tesla combined.

But while Tesla talks about the future of robotics, Amazon's (NASDAQ: AMZN) robots are already delivering the goods -- both literally and figuratively. In fact, Amazon is already the largest manufacturer and operator of mobile robotics in the world.

Where to invest $1,000 right now? Our analyst team just revealed what they believe are the 10 best stocks to buy right now. Learn More »

So if you're looking for the real leader in artificial intelligence (AI) robotics, it's Amazon.

1 million robots and counting

Amazon got into the robotics space in 2012 when it acquired Kiva Systems for $775 million. While a small deal at the time, it is really starting to pay dividends for Amazon. Earlier this month, the company surpassed 1 million robots operating inside its fulfillment centers. These robots now assist with about 75% of all customer orders placed through Amazon.com.

Those are some huge numbers, and they are likely only going to get bigger. The company is soon expected to have more robot workers than human ones. Amazon's robots also aren't just moving packages around. They're sorting inventory, lifting heavy loads, unloading trailers, and increasingly handling complex warehouse tasks.

AI gives Amazon an advantage

What sets Amazon apart from other robotics companies is how it's using AI to make its robots smarter to improve efficiency. Its Lab126 team is working on a new generation of warehouse robots that can follow voice commands, adjust to problems in real time, and even fix themselves when something breaks.

Amazon also just introduced an AI model called DeepFleet to manage and coordinate its entire robot fleet. The goal is to move packages faster and at lower cost by making better decisions about what robots should do and when.

These robots also go well beyond moving boxes. They can find specific parts, reroute if an aisle is blocked, and unload trucks without needing everything pre-programmed. Some can even spot damaged items before they're shipped, which should reduce returns and improve customer satisfaction.

Robots also don't take breaks or call in sick, which means they can keep working around the clock. Over time, this should lead to faster shipping, lower labor costs, and stronger operating margins in Amazon's core e-commerce business.

AI in delivery, inventory, and beyond

Robots are just part of Amazon's AI efficiency story. Amazon's new Wellspring system uses AI to map out hard-to-reach delivery locations, such as large apartment complexes and office parks. The data can also be integrated into smart glasses for real-time navigation. This all helps improve delivery times, letting drivers complete more routes per shift.

The company is also using AI to fine-tune its inventory and delivery network. Through its SCOT (Supply Chain Optimization Technology) system, Amazon is now able to forecast demand for specific products by taking into account things like regional preferences, weather, and price sensitivity. Ultimately, this keeps inventory closer to customers, helping reduce shipping costs.

These improvements are already translating into better operating performance. Last quarter, Amazon's North America segment grew operating income by 16% on just 8% revenue growth. That's great operating efficiency.

Is Amazon stock a buy?

Of course, robotics is only one part of the Amazon story. Its cloud computing unit, Amazon Web Services (AWS), is its largest business by profitability, and its fastest growing. Customers continue to turn to Amazon's cloud infrastructure to build, train, and scale their own AI models and apps. Meanwhile, Amazon has developed its own custom AI chips, which help give it a cost advantage.

It also has a fast-growing sponsored ads business that is seeing strong growth. When investors think of digital advertising platforms, they generally think of Alphabet's Google search engine or Meta Platforms' social media apps, but Amazon is actually the third-largest platform in the world. Meanwhile, the company is using AI to help third-party merchants both improve listings as well as better target potential customers.

While the stock has rebounded off its lows this year, the company still trades at a reasonable valuation, with a forward price-to-earnings (P/E) ratio of around 36 times this year's analyst estimates. That's still below its historical average.

Between its strong cloud computing growth, leading e-commerce operations, and the lead it has in automation and robotics, Amazon stock looks like a solid long-term buy.

Should you invest $1,000 in Amazon right now?

Before you buy stock in Amazon, consider this:

The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Amazon wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years.

Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you’d have $699,558!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $976,677!*

Now, it’s worth noting Stock Advisor’s total average return is 1,060% — a market-crushing outperformance compared to 180% for the S&P 500. Don’t miss out on the latest top 10 list, available when you join Stock Advisor.

See the 10 stocks »

*Stock Advisor returns as of June 30, 2025

John Mackey, former CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool’s board of directors. Suzanne Frey, an executive at Alphabet, is a member of The Motley Fool’s board of directors. Randi Zuckerberg, a former director of market development and spokeswoman for Facebook and sister to Meta Platforms CEO Mark Zuckerberg, is a member of The Motley Fool's board of directors. Geoffrey Seiler has positions in Alphabet. The Motley Fool has positions in and recommends Alphabet, Amazon, Meta Platforms, and Tesla. The Motley Fool has a disclosure policy.

Key Points

• Nvidia and TSMC are two of the best ways to play the AI infrastructure boom.

• Meta is applying AI across its apps to drive strong growth.

• Alphabet and Amazon are two cloud computing leaders.

Artificial intelligence (AI) is proving to be the next big technology innovation, and investors don't have to look far to find the companies at the center of it. Some of the best opportunities in the tech sector lie with companies that are either powering the infrastructure behind AI or using it to improve their operations.

Let's look at five top tech stocks to buy this month.

Where to invest $1,000 right now? Our analyst team just revealed what they believe are the 10 best stocks to buy right now. Learn More »

Nvidia

Nvidia (NASDAQ: NVDA) is the top name in AI infrastructure. Its graphics processing units (GPUs) have become the main chips used for training and running AI models, while it also offers networking equipment and can supply large, turnkey rack-scale systems it calls AI factories. However, Nvidia's strength doesn't just come from its powerful hardware. Its CUDA software platform long ago became the standard on which developers learned to program GPUs, creating a wide moat for the company.

Nvidia's dominance in the AI infrastructure market was on full display in the fiscal first quarter, as it captured an over 90% market share in the GPU space. Its new Blackwell architecture is ramping up faster than any chip in its history, and demand for its AI factories continues to surge. At the same time, new verticals like automotive are starting to gain traction.

As AI infrastructure spending continues to ramp up, Nvidia remains one of the best ways to invest in the space.

Taiwan Semiconductor Manufacturing

While Nvidia designs the chips that are powering the AI infrastructure boom, Taiwan Semiconductor Manufacturing (NYSE: TSM) is the company that actually makes them. TSMC is the world's largest semiconductor contract manufacturer, and one of the few companies with the technical expertise and scale to make the advanced chips used for AI. Not surprisingly, this led to strong growth, with the company's Q1 revenue jumping 35%. High-performance computing, which AI is a part of, now makes up nearly 60% of its business.

As demand from AI customers surges, TSMC continues to expand capacity and build new fabs. It's also been raising prices, which is leading to improved margins and growing profits. That's a great combination.

As the undisputed leader in advanced chip manufacturing, TSMC is positioned to continue to benefit from the AI infrastructure boom.

Meta Platforms

One of the world's top digital advertising platforms, Meta Platforms (NASDAQ: META) is using AI to help drive strong growth. Its proprietary AI model, Llama, is boosting user engagement and improving ad performance across its family of apps. That's leading to more inventory and higher ad prices. In Q1, ad impressions rose 5%, while pricing jumped 10%.

However, AI is just one part of Meta's growth story. The company started serving ads on WhatsApp, which has over 3 billion users, and is gradually rolling out ads on Threads, its Twitter-like platform that's already up to 350 million monthly users. These newer properties are just at the beginning of being monetized, which should lead to years of strong growth ahead.

Meta is investing heavily in AI talent, and looks to be one of the companies best positioned to benefit from the technology.

Alphabet

Alphabet (NASDAQ: GOOGL) (NASDAQ: GOOG) is one of the most overlooked AI plays in the market. While some investors worry about AI disrupting its search business, the reality is that Alphabet still has big advantages in distribution as well as with its far-reaching ad network.

Meanwhile, Alphabet is investing heavily in AI and other emerging technologies. Its Gemini model is considered one of the best in independent tests, while Google Cloud is the third-largest cloud computing platform and is growing quickly. The company has developed its own custom AI chips, which it both uses internally and rents out. At the same time, the company has a first-mover advantage in autonomous driving and robotaxis with its Waymo unit, while it's also a leader in quantum computing with its Willow chip.

Overall, Alphabet has a strong collection of leading and emerging businesses and a lot of growth opportunities ahead.

Amazon

While Amazon (NASDAQ: AMZN) is most often viewed simply as an e-commerce company, its largest business by profitability and its fastest-growing segment is Amazon Web Services (AWS). Amazon is the market share leader in the cloud computing industry. AI is driving growth in the segment as customers use its services to build and deploy AI models and apps and then run them on its infrastructure. Amazon also designed its own custom chips specifically for AI training and inference, giving it an edge in cost and performance.

Not to be overlooked is the company's leadership in robotics. While Tesla touted its Optimus robot, Amazon already has over 1 million robots working in its fulfillment centers globally. Its entire fleet of robots will soon be powered by a newly launched generative artificial intelligence model called DeepFleet that will coordinate the movement of its robots for faster and more cost-effective package deliveries.

The company even has robots that can spot damaged goods before they are shipped, which helps reduce costly returns. Between its use of AI and robots, Amazon is reducing costs and becoming more efficient within its e-commerce segment.

Amazon is a company at the cutting edge of AI and robotics, and one investors should not sleep on.

Should you invest $1,000 in Nvidia right now?

Before you buy stock in Nvidia, consider this:

The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Nvidia wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years.

Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you’d have $699,558!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $976,677!*

Now, it’s worth noting Stock Advisor’s total average return is 1,060% — a market-crushing outperformance compared to 180% for the S&P 500. Don’t miss out on the latest top 10 list, available when you join Stock Advisor.

See the 10 stocks »

*Stock Advisor returns as of June 30, 2025

Suzanne Frey, an executive at Alphabet, is a member of The Motley Fool’s board of directors. Randi Zuckerberg, a former director of market development and spokeswoman for Facebook and sister to Meta Platforms CEO Mark Zuckerberg, is a member of The Motley Fool's board of directors. John Mackey, former CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool’s board of directors. Geoffrey Seiler has positions in Alphabet. The Motley Fool has positions in and recommends Alphabet, Amazon, Meta Platforms, Nvidia, Taiwan Semiconductor Manufacturing, and Tesla. The Motley Fool has a disclosure policy.

Key Points

• Amazon and Microsoft are the two largest cloud computing companies.

• Microsoft Azure has been growing more quickly, but a strained relationship with OpenAI leaves some questions.

• Amazon's AWS, meanwhile, has a vertical integration advantage.

When it comes to cloud computing, Amazon (NASDAQ: AMZN) and Microsoft (NASDAQ: MSFT) are the clear leaders. Both are seeing strong growth, both are leaning heavily into artificial intelligence (AI), and both are investing billions to meet increasing demand.

But if I had to pick just one stock to own right now, I'd go with Amazon. Let's break down why.

Where to invest $1,000 right now? Our analyst team just revealed what they believe are the 10 best stocks to buy right now. Learn More »

Amazon

While best known for its e-commerce operations, Amazon basically invented the cloud computing industry due to its own struggles trying to scale up its infrastructure. Today, Amazon Web Services (AWS) is the largest cloud computing provider in the world, with nearly 30% market share.

AWS is also both Amazon's most profitable segment and fastest-growing, with revenue climbing 17% last quarter. AI has been a big reason for this. Customers are using AWS solutions like Bedrock and SageMaker to help them build and run their own AI models and apps. Bedrock gives companies access to foundation models they can customize, while SageMaker is more of an end-to-end solution. Once these models are built, they then run on AWS infrastructure, locking customers into a recurring, high-margin business.

On top of that, Amazon has built its own custom AI chips through its Annapurna Labs unit. Trainium is designed to train large language models (LLMs), while Inferentia handles inference. These chips are optimized for performance and cost, consuming less power and delivering better results than general-purpose graphic processing units (GPUs) for specific AI tasks. This gives Amazon a cost advantage over rivals like Microsoft and should lead to better operating leverage as usage scales.

Beyond the cloud, Amazon is also using AI to improve its e-commerce business, as well. The company is now using agentic AI to power autonomous warehouse robots. These robots continue to become more sophisticated and can perform multiple tasks. Some can even spot damaged goods before they're shipped, improving customer satisfaction and reducing costly returns. It recently just surpassed 1 million robots in its warehouses.

It's also using AI to improve efficiency in its logistics operations. AI is helping map out better routes, while mapping tools like Wellspring can help delivery drivers better navigate complicated drop-offs at places like large apartment complexes.

Amazon is also using AI tools to help third-party sellers better market products and target customers more effectively. It's worth noting that its sponsored ad business has become one of the largest digital ad platforms in the world and is growing quickly.

Microsoft

There's no denying that Microsoft is a powerhouse. The company has long been the dominant player in worker productivity software with programs such as Word, Excel, and PowerPoint, and its Windows operating system powers most non-Apple computers.

However, Microsoft's cloud computing unit Azure has been its big growth driver, with AI accelerating that momentum. Last quarter, Azure revenue jumped 33% year over year (35% in constant currency), with AI services making up nearly half of the growth.

Azure is currently firing on all cylinders, but Microsoft has been running into capacity constraints. To address that, Microsoft plans to increase its capital spending in fiscal 2026. It will also shift more investment into shorter-lived assets like GPUs and servers, which it said are more directly tied to revenue.

Microsoft made an early and aggressive investment in OpenAI, and the ability to give customers access to the start-up's leading LLM is one of the biggest reasons why Azure has been taking market share in the cloud computing space. Microsoft has also deeply integrated OpenAI's technology into its own products. For example, the technology is used to help power its AI assistant copilots in Word, Excel, and other productivity tools. At $30 per month per enterprise user, Microsoft's copilots have been a nice growth driver for the company.

Microsoft has also expanded AI beyond Office 365. It's added new copilots focused on cybersecurity and even launched Muse, an AI model designed to help develop and preserve older video games. Meanwhile, its GitHub Copilot has been one of its best-performing, helping drive solid growth for its code-hosting and collaboration platform.

However, the company's relationship with OpenAI has become strained. Microsoft is no longer the exclusive data center provider for the company, and the two have been fighting over the terms of Microsoft's investment, including whether it will get access to the intellectual property of OpenAI's pending acquisition of Windsurf.

Microsoft's investment in OpenAI is one of the most attractive parts of its story. It's currently entitled to 49% of OpenAI Global LLC's profits, capped at roughly 10 times its nearly $10 billion investment. But OpenAI is looking to renegotiate the deal as it looks to restructure into a for-profit company.

The better buy

Both Amazon and Microsoft are great companies with strong cloud computing platforms and big AI opportunities. However, Amazon has the edge.

Amazon's biggest advantage is that its cloud computing platform is vertically integrated. It can provide a wide range of services from custom chips to infrastructure to high-margin services. Its Inferentia and Trainium chips are helping lower its cloud computing costs, and AWS offers a wide array of foundation AI models, both from itself and other leading tech companies.

Microsoft, meanwhile, is reliant on expensive chips from Nvidia and AI models from OpenAI, with whom tensions have been growing. Microsoft is looking to develop its own AI chips, but it was recently reported that its next-generation Maia AI chip has been delayed. Azure has been growing more quickly than AWS, but it faces a lot more unanswered questions at the moment.

Microsoft is a solid stock to own long-term, but right now, Amazon is the better buy.

Should you invest $1,000 in Amazon right now?

Before you buy stock in Amazon, consider this:

The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Amazon wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years.

Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you’d have $699,558!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $976,677!*

Now, it’s worth noting Stock Advisor’s total average return is 1,060% — a market-crushing outperformance compared to 180% for the S&P 500. Don’t miss out on the latest top 10 list, available when you join Stock Advisor.

See the 10 stocks »

*Stock Advisor returns as of June 30, 2025

John Mackey, former CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool's board of directors. Geoffrey Seiler has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Amazon, Apple, Microsoft, and Nvidia. The Motley Fool recommends the following options: long January 2026 $395 calls on Microsoft and short January 2026 $405 calls on Microsoft. The Motley Fool has a disclosure policy.

Key Points

• AMD and GitLab are two beaten-down tech stocks seeing strong AI-related growth.

• e.l.f. Beauty's acquisition of Rhode positions it for a rebound.

• While well off their highs, Dutch Bros and Cava are two of the best growth stories in the restaurant space.

While the market has returned to new highs, not every growth stock has rebounded at the same pace. Five stocks still down 20% or more from all-time highs that look attractive are Advanced Micro Devices (NASDAQ: AMD), GitLab (NASDAQ: GTLB), e.l.f. Beauty (NYSE: ELF), Dutch Bros (NYSE: BROS), and Cava Group (NYSE: CAVA).

Let's look at what each of these five discounted growth stocks brings to the table.

Where to invest $1,000 right now? Our analyst team just revealed what they believe are the 10 best stocks to buy right now. Continue »

1. Advanced Micro Devices (down 35% from high)

While AMD remains a distant second to market leader Nvidia in graphics processing units (GPUs), it's starting to carve out a meaningful niche in artificial intelligence (AI) inference. That's important because the inference market is expected to become larger than AI training over time, and AMD's cost-effective chips are starting to gain traction.

On its latest earnings call, management said one of the largest AI-model companies is now using its GPUs for a large share of its daily inference workload. Major cloud providers are also turning to AMD chips for AI tasks like search and recommendation engines.

The company already has a leadership position in data central processing units, and its overall data center revenue has been growing strongly. Last quarter, its data center segment soared 57%, helping total revenue climb 36%. AMD doesn't need to unseat Nvidia in the GPU space, it just needs to gain a modest share to drive outsized growth from its smaller base. Given the pullback in the stock, the setup here looks attractive.

2. GitLab (down 65% from high)

GitLab has become one of the most important players in secure software development. Its DevSecOps platform is helping developers build, test, and deploy applications more efficiently in a secure environment, and its recent GitLab 18 launch only strengthens that position. The release includes over 30 new enhancements, including the GitLab Duo Agent Platform, which deploys AI agents across the entire software development life cycle, not just for code but also for documentation, testing, and compliance.

The company is seeing solid growth both from existing customers and new ones. Last quarter, its revenue climbed 27% year over year, while its dollar-based net retention rate was a robust 122%. Much of this growth is coming from existing customers expanding seats and upgrading to higher-tier plans.

While some investors fear that AI will lead to fewer coders over time, thus far, AI has led to an increase in both software development and the number of coders. GitLab stock has fallen too much on this fear, and it looks well-positioned moving forward.

3. e.l.f. Beauty (down 40% from high)

After a red-hot run, e.l.f. shares cooled off after the company's revenue growth slowed significantly to just 4% in its fiscal Q4. However, its recent $1 billion acquisition of Hailey Bieber's Rhode brand has the potential to reaccelerate growth in a big way.

Rhode has already hit $212 million in annual sales with just a handful of products on its website and minimal marketing. With e.l.f.'s strong relationships at Ulta Beauty and Target and Rhode's recent Sephora rollout, e.l.f. has the opportunity to put the brand in front of a lot more consumers. Bieber staying on as chief creative officer ensures brand continuity, and Rhode brings with it premium price points and a strong skincare lineup, which is an ideal complement to e.l.f.'s core mass-market cosmetics strength.

e.l.f. has already proven it can take a lot of market share in mass-market cosmetics, and Rhode adds a big potential growth driver. The company also continues to have opportunities with skincare, international expansion, and potentially moving into other adjacent categories like fragrance over time.

4. Dutch Bros (down 21% from high)

Dutch Bros is still in the early innings of what looks like a multi-year growth story. The drive-thru coffee chain now has over 1,000 locations but sees room for 7,000 over the long term. It's targeting 2,029 shops by 2029, which would still leave it with a long growth runway next decade as well.

Expansion is not the only story with Dutch Bros, though. It's also had strong same-store sales growth, and has an opportunity to continue to ramp it up. Last quarter, its same-store sales rose 4.7%, while company-owned comps climbed 6.9%. However, mobile ordering has just recently been rolled out, and the company has just begun piloting food items. Dutch Bros has admitted that a lack of breakfast offerings has likely cost it sales, and rival Starbucks has shown just how important food items can be, with food representing 19% of its sales last quarter.

Between an opportunity to grow same-store sales and expand its store base, Dutch Bros has a lot of long-term growth ahead of it.

5. Cava Group (down 43% from high)

Another strong growth story in the restaurant space is Cava. The Mediterranean restaurant operator has posted four straight quarters of double-digit same-store sales growth, including 10.8% last quarter. More impressively, traffic was up 7.5%, showing that customers are coming in more frequently despite price increases.

Higher-priced add-ons like pita chips and fresh juice are boosting ticket sizes, and the company is experimenting with new menu items and a tiered loyalty program to keep customers coming back. However, like Dutch Bros, Cava is very much an expansion story.

The company added 15 new restaurants last quarter and plans to open 64 to 68 new locations this year. With just 382 total restaurants as of the end of last quarter and a target of 1,000 by 2032, there's a long runway ahead. Its expansion strategy, dubbed the "coastal smile," has worked well, and a recent push into the Midwest with markets like Detroit and Chicago should accelerate growth even further.

Should you invest $1,000 in Advanced Micro Devices right now?

Before you buy stock in Advanced Micro Devices, consider this:

The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Advanced Micro Devices wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years.

Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you’d have $699,558!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $976,677!*

Now, it’s worth noting Stock Advisor’s total average return is 1,060% — a market-crushing outperformance compared to 180% for the S&P 500. Don’t miss out on the latest top 10 list, available when you join Stock Advisor.

See the 10 stocks »

*Stock Advisor returns as of June 30, 2025

Geoffrey Seiler has positions in GitLab, LVMH Moët Hennessy - Louis Vuitton, and e.l.f. Beauty. The Motley Fool has positions in and recommends Advanced Micro Devices, GitLab, Nvidia, Starbucks, Target, Ulta Beauty, and e.l.f. Beauty. The Motley Fool recommends Cava Group and Dutch Bros. The Motley Fool has a disclosure policy.

Key Points

• Motley Fool CEO Tom Gardner recently heralded the benefits of investing in the stock market over keeping your money at the bank.

• While stocks will have their ups and downs, over the long term the market tends to greatly outperform.

• The key is to find good stocks to invest in and keep investing in both good markets and bad.

In a recent interview, Motley Fool CEO Tom Gardner said, "The stock market is a bank that pays a higher interest rate than your bank ever will." However, he prefaced this with the fact that not every investment you make is going to go up, and you're not going to have a positive return each and every year.

In fact, Gardner said that if you buy 25 stocks, you need to be comfortable knowing that five of them are likely to be big disappointments. He added that he understands why some people can get intimidated by the stock market, but if you can get past that fear, then you can build a lot of wealth over time. Two of the keys are finding enough good companies to invest in and keeping at it.

Where to invest $1,000 right now? Our analyst team just revealed what they believe are the 10 best stocks to buy right now. Continue »

Finding winners

The S&P 500 index generated an average annual return of 10.5% over the past 30 years from 1995 to 2024. With banks notorious for paying very low interest rates and even high-yield savings accounts and money market funds currently paying rates less than 5%, investing in the stock market is highly likely to give you a better return over the long term.

Investing in individual stocks is also not easy, as Gardner points out, and you are inevitably going to have your fair share of losers along the way. In fact, a J.P. Morgan study found that between 1980 and 2020, 40% of the stocks in the Russell 3000 index, which consists of the 3,000 largest companies in the U.S., suffered a "catastrophic stock price loss," which it defined as a 70% drop in price from which a stock never fully recovered. In addition, the study found that two-thirds of stocks underperformed the index and 40% of stocks had negative returns.

That's some pretty scary stuff, but remember the stock market as a whole put up some strong returns during this period. How could that be when most stocks underperformed? The answer is that big winners helped power the market returns. These represent about 10% of the stocks in the Russell 3,000 and accounted for most of the index's gains over this period.

So as Gardner notes, find enough good companies to invest in and you can generate some pretty strong returns over time. There are a lot of well-known names that have been big winners over the years. This includes Amazon, Walmart, Starbucks, Chipotle Mexican Grill, Alphabet (Google), Meta Platforms (Facebook), Netflix, Apple, and Microsoft. These are companies with pretty recognizable businesses that aren't too difficult to understand, so you don't need to be turning over rocks looking for obscure companies no one has ever heard of to find eventual megawinners. They are often right in front of your face.

The ETF route

Of course, if investors don't want to invest in individual stocks, investing in an index exchange-traded fund (ETF) is another good option. An ETF like the Vanguard S&P 500 ETF (NYSEMKT: VOO) will give you instant diversity with a portfolio of approximately 500 stocks, and look to replicate the performance of the S&P 500 index, which is widely considered the barometer of the U.S. stock market.

The S&P 500 is a market capitalization weighted index, which means that the bigger a company gets (shares outstanding multiplied by share price), the larger a percentage of the index it becomes. This plays perfectly into benefiting from megawinners, as the index naturally lets these megawinners run and become bigger contributors over time.

The Vanguard S&P 500 ETF has a strong track record and is a low-cost way to mimic the performance of the S&P 500 index, which, as noted, is sure to give you a better return than a bank over time. ETFs are also great investment vehicles to use a dollar-cost averaging strategy with, where you invest money each month at a set amount no matter how the market is performing.

Whether you choose individual stocks or ETFs, you want to continue to invest in both bear and bull markets. Investing in bear markets can get you some great prices, while the stock market often will set new floors in bull markets. A separate J.P. Morgan study actually found that the S&P 500 hit highs on 7% of trading days since 1950 and that almost a third of the time, this marked a new floor for the market.

So while the market will have its ups and downs, over the long term, it is one of the best ways to build long-term wealth, and is a surefire way to get you a better return than you ever will at your local bank.

Should you invest $1,000 in Vanguard S&P 500 ETF right now?

Before you buy stock in Vanguard S&P 500 ETF, consider this:

The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Vanguard S&P 500 ETF wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years.

Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you’d have $697,627!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $939,655!*

Now, it’s worth noting Stock Advisor’s total average return is 1,045% — a market-crushing outperformance compared to 178% for the S&P 500. Don’t miss out on the latest top 10 list, available when you join Stock Advisor.

See the 10 stocks »

*Stock Advisor returns as of June 30, 2025

John Mackey, former CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool's board of directors. JPMorgan Chase is an advertising partner of Motley Fool Money. Suzanne Frey, an executive at Alphabet, is a member of The Motley Fool's board of directors. Randi Zuckerberg, a former director of market development and spokeswoman for Facebook and sister to Meta Platforms CEO Mark Zuckerberg, is a member of The Motley Fool's board of directors. Geoffrey Seiler has positions in Alphabet. The Motley Fool has positions in and recommends Alphabet, Amazon, Apple, Chipotle Mexican Grill, JPMorgan Chase, Meta Platforms, Microsoft, Netflix, Starbucks, and Walmart. The Motley Fool recommends the following options: long January 2026 $395 calls on Microsoft, short January 2026 $405 calls on Microsoft, and short June 2025 $55 calls on Chipotle Mexican Grill. The Motley Fool has a disclosure policy.

Key Points

• Energy Transfer's strong position in natural gas transportation and storage and future Lake Charles LNG export terminal set it up to be an LNG winner.

• Williams' Transco system and strong presence in the Haynesville Basin position it well to serve growing LNG export demand.

• Cheniere Energy is the best pure-play way to invest in the LNG megatrend.

In the energy space, one of the fastest-growing markets is liquified natural gas (LNG). The market is growing quickly as Asian countries shift from coal to natural gas to help reduce emissions. And with an abundance of natural gas, the U.S. LNG export market is taking off. Shell predicts LNG demand to rise by 60% by 2040, showing the long-term growth of this market.

Let's look at three stocks best positioned to benefit from growing U.S. LNG exports that you can buy and hold for the long term.

Where to invest $1,000 right now? Our analyst team just revealed what they believe are the 10 best stocks to buy right now. Continue »

Energy Transfer

Energy Transfer (NYSE: ET) operates one of the largest and most integrated midstream energy systems in the U.S. Its assets span natural gas, crude oil, NGLs, and refined product transport, storage, and processing. That scale gives Energy Transfer a competitive advantage in capturing pricing differentials, managing seasonal spreads, and benefiting from rising volumes across the board. However, it is the company's strong position in natural gas transportation and storage that positions it well to benefit from growing U.S. LNG exports.

Energy Transfer is in full-on growth mode, with $5 billion in 2025 capital expenditures (capex) aimed at capturing AI-driven power demand and growing LNG export volumes. It's already signed a deal to supply natural gas directly to an upcoming AI-focused data center, while receiving inquiries from many more. Its Hugh Brinson pipeline out of the Permian is specifically designed to feed Texas' surging power needs. At the same time, it's lining up the final pieces to greenlight its long-awaited Lake Charles LNG export terminal. It has signed a deal with MidOcean Energy for it to fund 30% of the construction costs in exchange for 30% of the offtake, and it also has several long-term LNG supply agreements in place.

Financially, Energy Transfer is arguably in the best shape it has ever been in. Its leverage is now near the low end of its target range, and the distribution is well covered, with over 2x coverage last quarter. Importantly, 90% of its earnings before interest, taxes, depreciation, and amortization (EBITDA) comes from fee-based contracts, with a record-high percentage being take-or-pay. This gives it stable and predictable cash flows.

With a 7.2% yield and 3% to 5% targeted distribution growth, Energy Transfer offers a compelling mix of income, growth, and upside. Once approved, Lake Charles LNG offers it another compelling growth driver.

Williams

Williams Companies (NYSE: WMB) owns arguably America's most important gas pipeline system in Transco. Transco connects prolific Appalachian gas fields to high-growth demand centers along the Southeast and Gulf Coast. As coal plants retire and LNG exports surge, demand for Transco's capacity keeps rising, creating a steady stream of organic growth projects.

Williams has eight major expansions lined up for Transco through 2030, underpinned by long-term contracts. These are low-risk, high-return projects driven by structural trends like coal-to-gas switching and rising export demand. On top of that, the company is leaning into the data center buildout. Its $1.6 billion Socrates power project in Ohio is aimed directly at feeding natural gas to new data centers, while its stake in Cogentrix Energy provides intelligence on electricity market dynamics to help optimize supply and demand in real time.

Not to be overlooked, the company also has a strong position in the Haynesville Basin that it is currently expanding. While not the lowest-cost basin, its proximity to the Gulf Coast sets it up well for future LNG export growth.

All in all, Williams is an attractive growth stock in the pipeline space that should benefit from increasing LNG export demand.

Cheniere Energy

When looking at companies set to benefit from rising U.S. LNG exports, Cheniere Energy (NYSE: LNG) is the purest way to play this megatrend. It owns and operates the Sabine Pass terminal in Louisiana through its stake in Cheniere Energy Partners (NYSE: CQP), and has direct ownership of the Corpus Christi terminal in Texas. These two facilities make Cheniere the largest LNG exporter in the country, and one of the largest globally.

Cheniere's business model is centered around long-term, take-or-pay contracts with global buyers, which insulates the company's cash flows from big commodity swings. Currently, 95% of its capacity is contracted out until the mid-2030s.

Cheniere has been in the process of building seven new trains at Corpus Christi through its CCL Stage 3 project, which will increase the company's capacity by more than 20%. The company said that Train 1 was substantially complete in March and that Train 3 is progressing toward late 2025 completion. The company is already planning final investment decisions for mid-scale Trains 8 and 9, and will decide whether to go through with a Sabine Pass expansion by early 2027.

Even with trade policy noise, Cheniere recently reaffirmed its 2025 guidance of $6.5 billion to $7 billion in adjusted EBITDA and $4.1 billion to $4.6 billion in distributable cash flow. It expects to produce between 47 million and 48 million tons of LNG in 2025, including contributions from the first three trains at CCL Stage 3.

Overall, Cheniere is one of the best ways to play growing global LNG demand.

Should you invest $1,000 in Energy Transfer right now?

Before you buy stock in Energy Transfer, consider this:

The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Energy Transfer wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years.

Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you’d have $697,627!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $939,655!*

Now, it’s worth noting Stock Advisor’s total average return is 1,045% — a market-crushing outperformance compared to 178% for the S&P 500. Don’t miss out on the latest top 10 list, available when you join Stock Advisor.

See the 10 stocks »

*Stock Advisor returns as of June 30, 2025

Geoffrey Seiler has positions in Energy Transfer. The Motley Fool has positions in and recommends Cheniere Energy. The Motley Fool has a disclosure policy.

It's been frustrating to be a Nike (NYSE: NKE) investor the past few years, but investors cheered after new CEO Elliott Hill indicated that the worst was now behind the company after it reported its fiscal fourth quarter results.

Nike shares surged on the results, which topped low expectations, although the stock is still down on the year and more than 20% lower over the past five years.

Where to invest $1,000 right now? Our analyst team just revealed what they believe are the 10 best stocks to buy right now. Learn More »

Let's delve into Nike's recent earnings to see why now is a good time to pick up shares in the iconic sneaker and apparel maker.

The worst is over

Hill, who has been on the job for less than a year, has been working hard to help turn around Nike's business following the missteps of former CEO John Donahoe. Hill's predecessor neglected innovation and pushed the company's classic footwear segment, which consists of brands like Air Jordan and Air Force 1. He also made a big direct-to-consumer push while neglecting important wholesale relationships.

Hill has been working to rewind the damage done by Donahoe through his Win Now action plan. The main tenet of his plan is to return Nike to its innovation roots. He has reorganized the business to drive sports-specific innovation across its three main brands: Nike, Jordan, and Converse. The company has seen some early traction with new innovation, with its Vomero 18 running shoe becoming a $100 million-plus franchise with strong sell-through just 90 days after launch.

The company is also working to mend its relationship with wholesalers. On this end, it recently announced a new partnership with Amazon, where the e-commerce giant will carry a select assortment of Nike footwear, apparel, and accessories. Nike also hired retail marketing, visual merchandising, and account managers to work with large wholesalers to help with their presentations and create better consumer connections.

In addition, the company is looking to implement sharper marketplace segmentation in order to serve its customers at different price points. At the same time, it is looking to position Nike Digital and Nike Direct as premium destinations. This means you might be able to get some lower-priced Nike products at a retailer like Kohl's, while Nike will have its high-end products with the newest technology on its apps and in its stores.

While Nike's actual results were still weak, Hill said it's time to turn the page and that he expects Nike's results to improve moving forward.

For fiscal Q4, Nike's revenue declined 12% to $11.1 billion, with Nike brand revenue down 11% to $10.8 billion. Nike Direct revenue sank 14% to $4.7 billion, as digital sales collapsed 26%. This is largely due to the company repositioning its digital app as a premier destination. Wholesale revenue, meanwhile, dropped 9% to $6.4 billion.

China remained a weak spot, with revenue sinking 21% in the quarter to $1.5 billion. Nike has been heavily discounting in China to reset its inventory.

North America revenue dipped 11% to $4.7 billion, with apparel sales down 7% and footwear revenue falling 13%. EMEA (Europe, Middle East, and Africa) sales sank 9%, while Asia Pacific and Latin America sales decreased by 8%.

Heavy discounting to clear inventory continued to weigh on Nike's gross margins, which fell 440 basis points to 40.3%. Between declining sales and gross margins, its earnings per share (EPS) plunged 86% in the quarter to $0.14.

The company said that tariffs would be a significant new cost headwind, representing an estimated $1 billion in gross costs. It said the tariffs would hurt its gross margin by 75 basis points this fiscal year, with the bigger impact in the first half. It is currently working with suppliers and retail partners to mitigate the costs and impact on consumers.

Is Nike stock a buy?

While Nike's progress has not yet shown up in its results, Hill is helping lay the groundwork for the company to get back on track. He's been leaning into innovation, rebuilding wholesale partnerships, repositioning Nike's app and stores as premium destinations, and working to segment the brand into both premium and core offerings depending on the channel.

While the stock trades at a pretty hefty valuation, with a forward price-to-earnings (P/E) ratio of around 39 times analysts' 2026 estimates, that's largely because Nike's earnings have been depressed. If Hill can get Nike's EPS back to the $3.73 it was in fiscal year 2024, the stock would trade at under 20 times earnings.

Nike still has work to do, but now could be a good opportunity to buy the stock when the company is showing signs of a turnaround and the stock is still down on the year.

Should you invest $1,000 in Nike right now?

Before you buy stock in Nike, consider this:

The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Nike wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years.

Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you’d have $713,547!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $966,931!*

Now, it’s worth noting Stock Advisor’s total average return is 1,062% — a market-crushing outperformance compared to 177% for the S&P 500. Don’t miss out on the latest top 10 list, available when you join Stock Advisor.

See the 10 stocks »

*Stock Advisor returns as of June 23, 2025

John Mackey, former CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool's board of directors. Geoffrey Seiler has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Amazon and Nike. The Motley Fool has a disclosure policy.

The secret to retiring a multi-millionaire is quite simple. There is no easier way to accomplish this than by using a consistent dollar-cost averaging strategy. If you start investing early and use this investment strategy, your odds of retiring a multi-millionaire are extremely good.

Dollar-cost averaging is one of the simplest and most effective investing strategies out there. Instead of trying to time the market, you simply invest at regular intervals, regardless of where prices are.

Where to invest $1,000 right now? Our analyst team just revealed what they believe are the 10 best stocks to buy right now. Learn More »

By investing a fixed amount every month, or every paycheck, you'll buy more shares when prices are low and fewer shares when they're high. Over time, this will smooth out your cost basis and help protect you from big market swings. It's a disciplined approach that will keep you investing through both bull and bear markets.

Some of the best investment vehicles to use this strategy with are exchange-traded funds (ETFs). With ETFs, you can get an instant portfolio of stocks without doing a lot of research. ETFs are also very accessible. You can feel comfortable starting with a small amount -- the key is just investing consistently.

With the power of compounding, dollar-cost averaging consistently into an ETF can help you retire a multi-millionaire. You also don't have to start with a large amount. If you are in your mid-twenties and have 40 years until retirement, a simple $500 investment each month can turn into a nearly $5 million nest egg by the time you hit retirement age with just a 12% average annual return.

If you're older, though, don't fret. A $1,000 investment each month at a 12% annual return can give you a $3 million portfolio after 30 years. However, the sooner you start, the better, as $1,000 each month for 40 years turns into nearly $10 million.

Let's look at five ETFs with strong track records that can help you retire a multi-millionaire.

Vanguard S&P 500 ETF

With a 12.8% return over the past decade, the Vanguard S&P 500 ETF (NYSEMKT: VOO) is one of the first choices that investors should consider when looking to implement a dollar-cost-averaging strategy. The ETF replicates the performance of the S&P 500, which is widely considered the benchmark for the U.S. stock market.

The ETF is a nice blend of growth and value large-cap stocks, and with around 500 stocks in the fund, it gives investors instant diversity.

Vanguard Growth ETF

Growth stocks have been leading the way in the market for the better part of two decades. The Vanguard Growth ETF (NYSEMKT: VUG) is a great way to invest in this dynamic. With a 15.3% return over the last 10 years, this ETF is another solid choice for investors looking to use a dollar-cost-averaging strategy.

While the ETF officially tracks the CRSP US Large Cap Growth Index, this is essentially the growth side of the S&P 500. It's not as diversified as the S&P 500, with only around 165 stocks in its portfolio, but you're getting the best of the large-cap growth stocks through the ETF.

Invesco QQQ Trust

The Invesco QQQ Trust (NASDAQ: QQQ) has quite simply been one of the best-performing non-sector-specific or non-leveraged ETFs over the past decade. The ETF tracks the performance of the Nasdaq-100 index, which is made up of the 100 largest non-financial stocks that trade on the Nasdaq Stock Exchange. The Nasdaq has long been known as the exchange for emerging growth and technology companies, so the ETF is heavily weighted toward these types of stocks.

The ETF has generated an average annual return of 17.7% over the past 10 years, easily ahead of the return of the S&P 500 over the same stretch. Even more impressive is that it has consistently beaten the S&P 500 more than 87% of the time on a 12-month rolling basis.

Schwab U.S. Dividend Equity ETF

Investing in growth and technology stocks is not the only investment style, and the Schwab U.S. Dividend Equity ETF (NYSEMKT: SCHD) is a nice value investment alternative. The ETF tracks the Dow Jones U.S. Dividend 100 Index, which consists of high-yielding U.S. stocks that have long track records of consistently paying out dividends.

While the ETF has only generated a 10.6% average annual return over the past 10 years, it has produced a 12.2% annual average return since its inception in October 2011. That's a solid long-term track record.

ARK Next Generation Internet ETF

If you're looking to swing for the fences, the ARK Next Generation Internet ETF (NYSEMKT: ARKW) could be right for you. Unlike the other ETFs, it is actively managed and does not follow an index. Instead, it is focused on investing in companies "that benefit from the increased use of shared technology, infrastructure and services, internet-based products and services, new payment methods, big data, the internet of things, and social distribution and media." In addition to investing in stocks, it currently has an investment in an ETF that tracks the price of Bitcoin.

The ETF has been a strong performer, generating an average annual return of 18.2% over the past 10 years. However, you'll need a strong stomach, as the ETF has seen some wild swings over the past few years, as shown in the table below.

Year	2020 Year	2021 Year	2022 Year	2023 Year	2024 Year
Performance	157.08%	-16.65%	-67.49%	96.99%	42.27%

Data source: Ark Invest.

As such, this ETF is only for the most aggressive investors.

Should you invest $1,000 in Vanguard S&P 500 ETF right now?

Before you buy stock in Vanguard S&P 500 ETF, consider this:

The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Vanguard S&P 500 ETF wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years.

Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you’d have $713,547!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $966,931!*

Now, it’s worth noting Stock Advisor’s total average return is 1,062% — a market-crushing outperformance compared to 177% for the S&P 500. Don’t miss out on the latest top 10 list, available when you join Stock Advisor.

See the 10 stocks »

*Stock Advisor returns as of June 23, 2025

Geoffrey Seiler has positions in Invesco QQQ Trust and Vanguard S&P 500 ETF. The Motley Fool has positions in and recommends Bitcoin, Vanguard Index Funds-Vanguard Growth ETF, and Vanguard S&P 500 ETF. The Motley Fool has a disclosure policy.

The technology sector has helped lead the market higher over the past decade, and with new technologies such as artificial intelligence (AI) and autonomous driving continuing to emerge, there is every reason to believe it can do the same over the next decade.

Let's look at three leading tech companies to buy this year.

Where to invest $1,000 right now? Our analyst team just revealed what they believe are the 10 best stocks to buy right now. Continue »

1. Nvidia

Graphics processing units (GPUs) maker Nvidia (NASDAQ: NVDA) has established itself as the leading semiconductor company in the world. The strength of GPUs lies in their parallel processing capabilities, which allow them to perform many calculations at the same time. This capability makes these powerful chips ideal for running AI workloads in the data center.

The real secret to Nvidia's successes, though, is its CUDA software program. Created to expand the market for GPUs beyond their original intent of speeding up graphics rendering in video games, Nvidia aggressively pushed the software platform into universities and research labs in its early days, which helped make it the platform upon which developers learned to program GPUs for various tasks.

In the years since, the company has built a collection of tools and libraries that help improve the performance of its GPU for use in running AI workloads. This has helped give the company a dominant market share in the GPU space of more than 80%.

As the AI infrastructure market continues to grow, Nvidia continues to be the biggest beneficiary. However, that's not its only growth market, and the company also sees a big future opportunity in the automobile and autonomous driving sector. After all, autonomous vehicles need to perform quick calculations, which is the strength of GPUs, so they don't crash.

Since Nvidia doesn't have a recurring revenue stream, any slowdown in its end markets is a risk, but right now these markets still appear to be in the early days of their growth cycles.

2. Alphabet

Alphabet (NASDAQ: GOOGL) (NASDAQ: GOOG) is certainly not without its risks, as some investors fret over AI disrupting its search business, while at the same time, it faces legal remedies from the U.S. government after losing an antitrust trial. However, the company has a collection of very attractive businesses and investors have largely ignored the advantages in search the company has.

Alphabet is about much more than Google search. Its YouTube business is not only the most-watched streaming platform, but it is also one of the largest digital advertising platforms in the world.

Meanwhile, its cloud computing unit, Google Cloud, is Alphabet's fastest-growing business, as it helps customers build out and run AI models and apps on its platform. Also not to be overlooked is its robotaxi business, Waymo, which has a first-mover advantage in the U.S. and is expanding rapidly.

That said, Google is still Alphabet's bread and butter, but it's not time to write this dominant search engine off just yet. Google has a large distribution and ad network advantage that should not be overlooked. Its distribution advantage comes from its popular Android smartphone operating system and Chrome browser, which use its Google search engine as a default.

Meanwhile, it has a revenue-sharing agreement with Apple and browser companies like Opera to run their search queries, as well. In addition, it has spent decades building one of the largest ad markets on the planet, with an ability to serve not only national advertisers, but also local businesses.

Alphabet also knows how to monetize search better than any company, and as the world moves toward AI search and chatbots, it's focused on profiting from queries that have commercial intent. That's why when it recently launched its new AI search mode, it included several commerce-focused features aimed at enhancing monetization, such as "Shop by AI," which allows users to find products simply by describing them, virtually try on clothes using a photo, and even track prices.

With unmatched distribution, a massive ad network, and a focus on commerce monetization, Alphabet is well situated to be an AI search winner.

3. Salesforce

Salesforce (NYSE: CRM) has long been the leader in customer relationship management software, and now it's setting its sights on becoming a leader in AI agents through its new Agentforce platform.

The company's core value proposition has always been about unifying customer data, and it has expanded this concept into the data center with its Data Cloud offering. Through acquisitions, it's also established a leadership position in employee and customer-facing apps, such as Slack and Tableau. This type of ecosystem is an ideal environment for AI agents to interact with this data and use it to automatically perform tasks.

Agentforce includes pre-built AI agents that can help businesses streamline tasks, as well as low-code and no-code tools that let customers design their own custom AI agents with little technical expertise. It has also established an Agentforce marketplace with more than 200 partners to offer more templates and broaden use cases. Thus far, Agentforce has seen solid momentum, with it already having more than 4,000 paying customers since its October launch and many more in pilots.

Salesforce is looking to lead a digital labor revolution. It plans to accomplish this through its ADAM framework that combines agents, data, apps, and metadata into one platform. It recently introduced a new consumption-based model that better aligns agent costs with business outcomes to help improve customer satisfaction and increase adoption.

Agentic AI is a competitive space, but Salesforce looks like it has the platform to be a winner.

Should you invest $1,000 in Nvidia right now?

Before you buy stock in Nvidia, consider this:

The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Nvidia wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years.

Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you’d have $669,517!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $868,615!*

Now, it’s worth noting Stock Advisor’s total average return is 792% — a market-crushing outperformance compared to 173% for the S&P 500. Don’t miss out on the latest top 10 list, available when you join Stock Advisor.

See the 10 stocks »

*Stock Advisor returns as of June 2, 2025

Suzanne Frey, an executive at Alphabet, is a member of The Motley Fool's board of directors. Geoffrey Seiler has positions in Alphabet, Opera, and Salesforce. The Motley Fool has positions in and recommends Alphabet, Apple, Nvidia, and Salesforce. The Motley Fool has a disclosure policy.

With the stock market settling in after a volatile period, now is a good time to start looking at some leading growth stocks that have strong potential over the next decade.

Here are five growth stocks across industries that investors can look to hold for the long term.

Where to invest $1,000 right now? Our analyst team just revealed what they believe are the 10 best stocks to buy right now. Learn More »

1. Taiwan Semiconductor Manufacturing

Taiwan Semiconductor Manufacturing (NYSE: TSM) is one of the most critical players in the artificial intelligence (AI) boom. As the world's leading contract chip manufacturer, TSMC manufactures the advanced semiconductors powering a range of products from AI infrastructure to smartphones and automotive tech.

Producing these chips isn't easy, as it requires leading-edge technology, precision manufacturing, and scale. Few companies in the world have the capabilities or the track record that TSMC does, and with competitors struggling, it has also garnered strong pricing power.

As such, the company has become the go-to partner for top chip designers, thanks to its leadership in advanced nodes and packaging. Advanced nodes refer to manufacturing processes that allow more transistors to be packed onto a chip, which in turn boosts performance and power efficiency.

Meanwhile, demand for high-performance computing, including AI chips, has exploded. With AI workloads growing, TSMC is expanding capacity alongside key customers to meet future demand.

Despite its pivotal role in the AI supply chain, TSMC's stock still looks reasonably valued. For long-term investors looking to benefit from the continued growth in AI infrastructure and semiconductors in general, TSMC is a great stock to hold.

2. Pinterest

Pinterest (NYSE: PINS) has undergone a quiet but powerful transformation under CEO Bill Ready. Over the past three years, the company has invested heavily in technology to turn its massive user base, which now sits at more than 570 million monthly active users worldwide, into a growth engine. Pinterest is no longer just an online vision board; it's become a shoppable platform with growing ad conversion capabilities.

One of the big drivers behind Pinterest's transformation has been its embrace of AI. The company built a multimodal model trained on both images and text to better understand what users are looking for. This powers personalized recommendations, while a visual search feature makes it easier for users to find and shop for products they see in pinned images. On the backend, meanwhile, its Performance+ platform is giving advertisers the tools to run better campaigns.

The results speak for themselves. Last quarter, Pinterest's revenue jumped 16%. Average revenue per user (ARPU) climbed across all regions, especially outside the U.S., where Pinterest is starting to better monetize users in emerging markets through the help of a partnership with Google.

Pinterest's stock still looks attractively valued, and the company is just scratching the surface of monetizing its user base. With AI-powered tools and a more shoppable platform, Pinterest has solid long-term investment potential.

3. Dutch Bros

Dutch Bros (NYSE: BROS) is shaping up to be one of the most compelling expansion stories in the restaurant space. With just over 1,000 locations across 18 states, the company believes it can more than double its footprint to 2,029 shops by 2029, and it sees the opportunity to eventually support 7,000 coffee shops nationwide.

Meanwhile, its small, drive-thru-focused shops are inexpensive to build, have attractive unit economics, and offer fast payback periods.

What makes the story even more attractive, though, is that Dutch Bros is only now starting to unlock other key growth levers. Mobile ordering, for example, is still early but gaining traction, accounting for only 11% of transactions last quarter. Mobile ordering also feeds into its loyalty program, allowing it to personalize its marketing and promotions.

The company is also leaning into food, testing hot items to drive breakfast sales at a few select locations. Food currently makes up less than 2% of sales, compared to nearly 20% at Starbucks, so there's real upside here. With more menu expansion and store openings on the way, Dutch Bros looks like a long-term winner.

4. Philip Morris International

Philip Morris International (NYSE: PM) is a growth stock in a defensive industry. While many tobacco companies are struggling with declining cigarette volumes in the U.S., Philip Morris doesn't have to worry about that because it doesn't sell cigarettes domestically. Instead, its growth is being driven by its smokeless portfolio, led by Zyn and Iqos, both of which have better unit economics than traditional cigarettes.

Zyn, its fast-growing nicotine pouch, has been its biggest growth driver, as evidenced by U.S. shipment volumes jumping 53% in Q1.

Meanwhile, Iqos, its premium heated tobacco product, continues to gain traction in Europe and Japan, with early success in new markets like Mexico City, Jakarta, and Seoul. In addition, after buying back its U.S. rights from Altria, the U.S. has the potential to be its next big growth driver. At the same time, its traditional cigarette business remains stable overseas, helped by strong pricing power and steady demand.

With strong pricing power, local manufacturing that limits tariff exposure, and growing demand for Zyn and Iqos, Philip Morris looks well positioned to keep delivering strong growth in the future.

5. Eli Lilly

Eli Lilly (NYSE: LLY) has emerged as a leader in the booming GLP-1 drug space, with surging demand continuing to drive strong revenue growth. Last quarter, its two key GLP-1 drugs -- Mounjaro and Zepbound -- generated a combined $6.1 billion in revenue, up sharply year over year. While Zepbound is officially approved by the Food and Drug Administration (FDA) for weight loss in obese adults or overweight adults with at least one weight-related condition, and Mounjaro is approved to help adults with type 2 diabetes, the reality is that the growth of these drugs is being driven by their being prescribed off-label for weight loss.

However, the drug that could be the biggest game changer for Lilly is still on its way. Orforglipron, its first oral GLP-1 drug candidate, recently demonstrated in a phase 3 trial that patients who took the drug lost considerable weight. As an oral medication, it is a much more convenient alternative to injectable GLP-1 drugs, making it especially appealing to patients who are wary of needles.

Orforglipron is also easier to manufacture and distribute than injectable drugs, as it doesn't require cold storage or injection pens. This should help Lilly avoid the supply constraints it saw with its injectable GLP-1 portfolio. With orforglipron looking like it has the potential to be the most potent oral GLP-1 weight loss drug on the market, Lilly is well positioned for continued future growth.

Should you invest $1,000 in Taiwan Semiconductor Manufacturing right now?

Before you buy stock in Taiwan Semiconductor Manufacturing, consider this:

The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Taiwan Semiconductor Manufacturing wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years.

Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you’d have $669,517!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $868,615!*

Now, it’s worth noting Stock Advisor’s total average return is 792% — a market-crushing outperformance compared to 173% for the S&P 500. Don’t miss out on the latest top 10 list, available when you join Stock Advisor.

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Geoffrey Seiler has positions in Philip Morris International and Pinterest. The Motley Fool has positions in and recommends Pinterest and Taiwan Semiconductor Manufacturing. The Motley Fool recommends Dutch Bros and Philip Morris International. The Motley Fool has a disclosure policy.

Nvidia (NASDAQ: NVDA) once again demonstrated rapid growth as demand for its graphics processing units (GPUs) remains robust. Even with new export controls severely limiting its ability to sell into China, the company projects strong revenue growth moving forward as the artificial intelligence (AI) infrastructure buildout continues to march along.

The stock is up an astonishing 1,450% over the past five years, as of this writing. Let's take a closer look at Nvidia's results to see whether the stock still has a lot of growth left in the tank.

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Blackwell leads the way despite China headwinds

The new export controls, which restrict Nvidia's ability to sell its chips in China, are expected to have a material impact on the company's revenue. It will take an $8 billion hit to sales in the second quarter alone. It noted that its H20 chip has been sold in China for more than a year and that no grace period was provided to let it sell through its inventory. In Q1, it generated $4.6 billion in H20 revenue, all of which occurred before April 9, and took a $4.5 billion charge. It said Chinese revenue would have been $7 billion in for the quarter if not for the export controls.

The company made a plea to be allowed to sell into China, stating that not having access to the Chinese market will benefit its foreign competitors in China and worldwide. It said China already has AI, and the assumption that it can't make AI chips is false. It believes the Chinese AI accelerator market will eventually grow to $50 billion, while noting that export restrictions spurred China's innovation and scale.

Even without access to China, however, Nvidia still forecasts its fiscal Q2 revenue to be approximately $45 billion, which would represent 50% growth. This will largely come from the continued ramp-up of its Blackwell GPUs.

Blackwell drove Nvidia's revenue growth in Q1, with the company calling it the fastest ramp-up in its history. Data center revenue surged 73%, with Blackwell contributing nearly 70% of its data center compute revenue in the quarter.

Nvidia stated that AI factory buildouts, which are large-scale rollouts that use its full stack of solutions, not just GPUs, are driving significant revenue growth. It added that AI factory deployments are accelerating, with nearly 100 Nvidia-powered sites in progress this quarter, which was twice as many as last year. Notably, the average number of GPUs per factory has also doubled.

It also said that AI inference demand is soaring, and it believes that demand for AI computing will accelerate as AI agents become mainstream.

Nvidia's other segments were also strong. Gaming revenue jumped 42% to $3.8 billion, while professional visualization revenue rose by 9% to $509 million, and automotive and robotics revenue increased 72% to $567 million.

Nvidia's overall revenue climbed 69% to $44.1 billion, surpassing the $43 billion guidance it issued in February. Adjusted earnings per share (EPS), excluding its H20 write-off, grew 33% to $0.96 and topped the $0.93 analysts' consensus as compiled by LSEG.

Adjusted gross margin, excluding charges, was 71.3%, 220 basis points lower than last year. As Blackwell continues to ramp up, it is looking for gross margins to return to the mid-70% range later in the year.

The company continues to generate a boatload of cash, with operating cash flow of $27.4 billion and free cash flow of $26.1 billion in the quarter. Nvidia ended the quarter with net cash and marketable securities of $53.7 billion and $8.5 billion in debt.

Is Nvidia stock still a buy?

As AI infrastructure spending continues to surge, Nvidia remains the company best positioned to benefit. Its GPUs are still the backbone of AI data centers, and as the market shifts further toward real-time inference, agentic AI, and more advanced reasoning tasks, demand for computing power is expected only to grow. With both industry-leading hardware and a powerful software ecosystem in CUDA, Nvidia's dominance in the AI infrastructure market remains firmly intact.

While the loss of being able to sell into China is a blow to the company, it still has a long runway of growth in front of it. There also is always the possibility that the new export controls will be rolled back as part of the broader trade deal, which would be a huge bonus for the company.

Trading at a forward price-to-earnings (P/E) ratio of 31 times this year's analyst estimates, the stock is still attractively valued.

If AI infrastructure spending is still in its early innings, which it appears to be, Nvidia continues to look like a solid buy at these levels. The biggest risk to the stock would be a sudden slowdown in AI spending, but right now, there are few signs of that.

Should you invest $1,000 in Nvidia right now?

Before you buy stock in Nvidia, consider this:

The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Nvidia wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years.

Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you’d have $651,049!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $828,224!*

Now, it’s worth noting Stock Advisor’s total average return is 979% — a market-crushing outperformance compared to 171% for the S&P 500. Don’t miss out on the latest top 10 list, available when you join Stock Advisor.

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Geoffrey Seiler has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Nvidia. The Motley Fool has a disclosure policy.

While on-again, off-again tariffs have created a lot of uncertainty and volatility in the stock market, one set of companies that should see minimal impact one way or the other are cybersecurity providers. After all, cybercriminals and hackers aren't downsizing their attacks due to tariffs.

Let's look at four top cybersecurity stocks that investors might want to consider buying this month.

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1. Palo Alto Networks

Palo Alto Networks (NASDAQ: PANW) is in the midst of a transformation from being largely a provider of next-generation firewalls to becoming a comprehensive cybersecurity platform. Last year, it embarked on a new "platformization" strategy where it stopped selling new point solutions and began consolidating customers onto one of its three main cybersecurity platforms. To do this, it gave away some of its services for free to entice customers to ditch disparate point solutions and centralize on its platforms.

Thus far, the strategy appears to be working, with 1,150 of its top 5,000 customers now using one of its platforms. It hopes to have 2,500 to 3,500 platformization customers by fiscal year 2030. Its main platform is network security, but it has also been seeing a lot of growth coming from its threat detection and response solution Cortex, and its cloud security solution Prisma Cloud.

While its platformization strategy temporarily slowed its growth, it was the right move for the long term, and investors should be rewarded.

2. CrowdStrike

CrowdStrike (NASDAQ: CRWD) is another cybersecurity company that should benefit from the trend of companies looking to consolidate their cybersecurity needs onto a single platform. The company is best known as the leader in endpoint security, which is the protection of devices connected to a network, such as a smartphone or laptop. In fact, it is regularly at the top of Gartner's rankings for best endpoint security.

The company offers a comprehensive suite of cybersecurity protection, including threat intelligence, zero trust, logscale SIEM (log management and threat detections), and cloud security. And its flexible licensing and procurement service, Falcon Flex, is helping drive adoption of its modules.

Falcon Flex gives customers the flexibility to quickly deploy CrowdStrike solutions when and where they need them. Last quarter, 67% of CrowdStrike's customers deployed five or more of its modules, while 21% used eight or more.

With the impact of its highly publicized information technology outage now in the rearview mirror, and customer commitment packages (a set of incentives offered to affected customers, including discounts, subscription extensions, and other compensation deals) rolling off the books later this year, the company should begin to see growth start accelerating. That makes this a good time to jump into the stock.

3. Zscaler

Zscaler (NASDAQ: ZS) is a leader in zero-trust security, a model based on the principle that no user or device should be trusted. Instead, access to applications and data must be continuously verified, authorized, and revalidated to ensure security at every step.

Zero trust is becoming an increasingly important part of the cybersecurity landscape, and the company has been doing a great job of upselling its customers to new zero-trust systems. These include its Zscaler Private Access, which is being used to replace virtual private networks (VPNs), including within the federal government. Other products gaining traction include Zscaler Digital Experience, Zero Trust for Branch and Cloud, and artificial intelligence (AI) analytics.

It has also moved into data security to help prevent data loss in public AI apps. Last quarter, it saw a 40% increase in annual contract value for its data security products.

Overall, the company is growing, with revenue climbing 23% year over year last quarter. Its net dollar retention rate was 115%, showing its strong growth within its existing customer base. With zero trust and data protection becoming more important, Zscaler has a bright future.

4. SentinelOne

SentinelOne (NYSE: S) is a fast-growing endpoint cybersecurity company, trading at a low valuation. Its forward price-to-sales (P/S) multiple is only 6.6 times, despite having 29% revenue growth last quarter.

The company has a big opportunity in the second half of the year, when personal computer (PC) vendor Lenovo will begin shipping its computers with SentinelOne's Singularity Platform installed. Lenovo is the world's largest enterprise PC vendor, selling 61.8 million PCs last year, so this is a big deal for SentinelOne.

The company has also been doing a good job of upselling its Purple AI, which uses AI to help analysts detect complex security threats through the use of natural language prompts. It predicts that Purple's use of hyper-automation to enhance security operations by automating complex, multi-step processes will become "the bedrock for agentic AI in cybersecurity." Purple can also be run across vendor platforms, including Zscaler and Palo Alto.

Given its growth, the opportunities in front of it, and its valuation, SentinelOne is a stock investors can look to add to their portfolios.

Should you invest $1,000 in Palo Alto Networks right now?

Before you buy stock in Palo Alto Networks, consider this:

The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Palo Alto Networks wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years.

Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you’d have $635,275!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $826,385!*

Now, it’s worth noting Stock Advisor’s total average return is 967% — a market-crushing outperformance compared to 171% for the S&P 500. Don’t miss out on the latest top 10 list, available when you join Stock Advisor.

See the 10 stocks »

*Stock Advisor returns as of May 12, 2025

Geoffrey Seiler has positions in SentinelOne. The Motley Fool has positions in and recommends CrowdStrike and Zscaler. The Motley Fool recommends Gartner and Palo Alto Networks. The Motley Fool has a disclosure policy.

With the market settling down and trade tensions easing (for now), let's look at four artificial intelligence (AI) stocks that investors might want to consider buying right now. These are all leading tech companies with solid opportunities ahead.

1. Palantir Technologies

While much of the focus on AI has been on infrastructure and building out AI models, Palantir Technologies (NASDAQ: PLTR) has taken an approach that helps differentiate it from the pack. Its priority has been on the applications and workflow layers of AI, where it collects information from different sources and structures it into an "ontology," linking data to real-world objects and processes. Its Artificial Intelligence Platform (AIP) then works as an orchestration layer to help its customers use AI to solve real-world problems. It has also recently introduced AI agents within AIP that help automate decisions and drive action.

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The company's solution can be used for numerous applications across industries, giving it a huge market opportunity. Its solutions are also used within the U.S government, which is its largest customer, to help with mission-critical tasks. Its ability to help reduce costs and create efficiencies makes it a long-term winner that will eventually replace older, outdated systems, aligning it with the stated mission of the Department of Government Efficiency (DOGE). A recent deal with NATO, meanwhile, adds yet another growth leg to the Palantir story.

Overall, Palantir has one of the best long-term opportunities in front of it.

2. Nvidia

If there were any concerns that AI infrastructure expansion was slowing down, President Donald Trump's recent deal with Saudi Arabia should help ease those fears. As part of the deal, Nvidia (NASDAQ: NVDA) is set to ship billions of dollars worth of its new Blackwell graphics processing units (GPUs) to Saudi Arabia AI start-up Humain. Previously, Trump also led the way with Project Stargate, where a consortium led by OpenAI and SoftBank agreed to spend $500 billion building out AI data centers in the U.S. over the next few years.

Combine those projects with the massive AI infrastructure spending from cloud computing companies, as well as tech companies racing to build out AI models, such as Meta Platforms and xAI, and there is a lot of AI data center spending still going on.

Data infrastructure spending, meanwhile, is the biggest driver of Nvidia's growth. The company is the dominant player in GPUs, which are the main chips being used to run AI workloads. It's taken an over 80% market share in this massive market in large part due to its CUDA software program, which makes it easy for developers to program its chips and includes a collection of AI libraries and tools to accelerate the performance of its chips when running AI tasks.

As long as AI infrastructure spending continues to be strong, Nvidia will be a winner.

3. Salesforce

Salesforce (NYSE: CRM) helped revolutionize the software industry as one of the first major companies to introduce the software-as-a-service (SaaS) model. Today, it is looking to continue with its innovation path by working to become a leader in agentic AI. Through its new Agentforce platform, the company has integrated AI agents throughout its ecosystem that can automatically perform tasks with little to no human interaction.

Salesforce's platform includes pre-built AI agents that can help businesses streamline tasks in such areas as customer service, marketing, and sales. The company has also launched an AI agent marketplace with over 200 partners to broaden use cases. In addition, the platform includes no-code and low-code tools that let customers design their own custom AI agents with little technical expertise.

With a consumption-based product that costs $2 per conversation, Salesforce has a large opportunity in front of it if its AI agents can prove that they boost productivity and create cost savings. Thus far, the product has seen a nice reception, with more than 3,000 paid deals in place since its launch in October.

4. Pinterest

Online vision board platform provider Pinterest (NYSE: PINS) has been using AI to help successfully transform its platform into one that better engages its user base and makes it more shoppable. This has helped it both increase its number of users and well as better monetize them. But it's not finished yet.

The company developed a multimodal AI model trained on both images and text that can better interpret user intent and provide better personalized recommendations. This also allowed it to upgrade to visual search that lets users highlight a specific element within a pinned image to search for similar items based on visual or stylistic characteristics. Its visual searches can also include links directly to a retailer's checkout page for an item.

These are powerful tools that have caught the attention of brands and merchants. On the back end, meanwhile, it has introduced its Performance+ solution, which integrates AI-powered advertiser tools and new bidding functionalities, to help advertisers improve campaign performance and conversion rates.

Pinterest has a huge user base, and the company is just at the beginning of better monetizing them with the help of AI, making this a solid long-term investment.

Should you invest $1,000 in Palantir Technologies right now?

Before you buy stock in Palantir Technologies, consider this:

The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Palantir Technologies wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years.

Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you’d have $635,275!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $826,385!*

Now, it’s worth noting Stock Advisor’s total average return is 967% — a market-crushing outperformance compared to 171% for the S&P 500. Don’t miss out on the latest top 10 list, available when you join Stock Advisor.

See the 10 stocks »

*Stock Advisor returns as of May 12, 2025

Randi Zuckerberg, a former director of market development and spokeswoman for Facebook and sister to Meta Platforms CEO Mark Zuckerberg, is a member of The Motley Fool's board of directors. Geoffrey Seiler has positions in Pinterest and Salesforce. The Motley Fool has positions in and recommends Meta Platforms, Nvidia, Palantir Technologies, Pinterest, and Salesforce. The Motley Fool has a disclosure policy.

After seeing its shares tumble when the company pre-announced disappointing fiscal third-quarter results, Super Micro Computer (NASDAQ: SMCI) stock was once again falling after the company reported its full results and issued weak guidance.

It's been a crazy 2025 for the stock, which finds itself near breakeven on the year. However, it's also down nearly 50% since mid-February.

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The stock initially posted a huge rally after Supermicro was able to file its annual reports, potentially ending a saga related to its accounting. A short-seller initially accused Supermicro of manipulating its accounting, and the company subsequently delaying its annual report and its auditor resigning only added fuel to the fire. The fact that the Securities and Exchange Commission (SEC) had fined the company a few years earlier over accounting issues also didn't help its image.

Even as the stock rallied, though, underlying issues have been popping up with Supermicro's operational results. This is not the first time the company has lowered its fiscal-year guidance. It's been a consistent theme. In November, it slashed its fiscal first-quarter revenue guidance to a range of $5.9 billion to $6 billion from earlier guidance of between $6 billion and $7 billion. In February, meanwhile, it also announced that its fiscal Q2 revenue would fall short of expectations.

In addition to its struggles forecasting revenue, Supermicro has also seen gross margin pressure. This began in its fiscal Q4 ending in June 2024, when its gross margin sank to 11.3% from 17% a year earlier. The company said that this was because it reduced prices in order to secure new design wins. The lower gross margins are, the more difficult it is to turn revenue into profits.

Problems persist

With its fiscal Q3 report and guidance, Supermicro's past issues show no signs of letting up.

For the quarter, its revenue rose 19% to $4.6 billion, but that was well short of its earlier guidance for sales to range between $5 billion and $6 billion. Meanwhile, its fiscal Q4 guidance calling for sales of $5.6 billion to $6.4 billion also fell well short of the $6.82 billion analyst consensus, as compiled by LSEG.

At the time of its pre-announcement, Supermicro said customers were delaying platform decisions, which would move sales into its fiscal Q4. On its conference call, the company expanded on this, noting that it was due to customers waiting to evaluate the difference between Nvidia's Hopper and Blackwell graphics processing units (GPUs).

However, with its fiscal Q4 forecast far below estimates, it appears not enough of these sales were pushed into its June quarter. It now expects these commitments to come in the June and September quarters. It also cited tariffs and current macroenvironment uncertainty for its cautious outlook.

Gross margins also remained an issue, falling to 9.6% in the quarter. As a hardware integrator, Supermicro operates in a low-margin business. While it adds value by helping customers customize their server setups, the industry is highly competitive, with limited room for differentiation. Meanwhile, much of its revenue comes from passing through expensive components like GPUs.

However, the big drop in gross margins over the past year-and-a-half has been concerning. Meanwhile, it forecast gross margins to be around 10% in fiscal Q4, showing little sign of a recovery in the near term. It said its latest margin pressure stems from the GPU transition, with more price competition surrounding older platforms. It also noted pressure coming from tariffs.

Should investors buy the dip in the stock?

Brushing aside the accounting accusations and everything that went along with them, Supermicro is a company that has had its struggles. Revenue growth expectations have consistently been pushed lower over the past year, while already low gross margins have also come down considerably.

Now the stock appears cheap, with a forward price-to-earnings ratio (P/E) of under 9x based on fiscal-year 2026 analyst estimates. However, it is still to be seen if these estimates need to come down, as the company did not give fiscal 2026 guidance.

Supermicro should benefit from increased artificial intelligence (AI) infrastructure spending. However, it is in a low-margin, low-moat business, and the company has struggled. This is far different than a company like Nvidia that has gross margins above 70% and a wide technological moat.

Overall, I think the best way to play AI infrastructure is with the stocks of companies that have strong technology and attractive margin profiles. That description just does not fit Supermicro.

Should you invest $1,000 in Super Micro Computer right now?

Before you buy stock in Super Micro Computer, consider this:

The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Super Micro Computer wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years.

Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you’d have $614,911!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $714,958!*

Now, it’s worth noting Stock Advisor’s total average return is 907% — a market-crushing outperformance compared to 163% for the S&P 500. Don’t miss out on the latest top 10 list, available when you join Stock Advisor.

See the 10 stocks »

*Stock Advisor returns as of May 5, 2025

Geoffrey Seiler has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Nvidia. The Motley Fool has a disclosure policy.

When Advanced Micro Devices (NASDAQ: AMD) reported its first-quarter results recently, it gave a glimpse into why some investors remain excited about the stock's prospects despite its poor performance over the past year. As of this writing, the stock is down about 35% during that span.

This excitement stems from the revenue growth the company is seeing in its data center segment, where sales soared 57% to $3.7 billion. While that revenue is a fraction of what rival Nvidia (NASDAQ: NVDA) generates, the growth is nonetheless robust. AMD credited its strong data center growth to its continued central processing unit (CPU) server share gains and robust growth from its Instinct graphics processing units (GPUs).

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AMD has recently become the leader in the data center CPU space. While GPUs provide the power, CPUs are the brains behind the operations. The market is not nearly as big as the one for GPUs in the data center space, but it's still an important and growing market. In the quarter, several cloud computing providers started to offer new computing options based on AMD's latest EPYC chips. Its CPUs also saw strong growth in the enterprise segment.

AMD saw several hyperscalers (owners of massive data centers) expand their use of its GPUs for generative artificial intelligence (AI) tasks, such as AI search, rankings, and recommendations. It also said that one of the largest AI model companies is now using its GPUs to run a significant portion of its daily inference traffic. It added that big tech companies and AI start-ups are also now using its GPUs to help train their next-gen AI models.

While AMD is unlikely to overtake Nvidia anytime soon, it's still seeing strong growth and solid progress in the data center space. Meanwhile, while the AI training market has been the early focus of companies as they race to build better AI models, the inference market is eventually expected to become exponentially larger. AMD has always competed better in the inference market, so this eventual shift should be a big positive for the company.

Export restriction headwinds

While AMD's data center growth in the quarter was a highlight, not everything was coming up roses for the company. It said that it would lose out on around $700 million in revenue in the second quarter due to new export controls that would affect its MI308 GPU shipments to China. For the full year, it expects the export restriction to be a $1.5 billion headwind, with most of the effect in the second and third quarters.

Nonetheless, the company still forecasts strong double-digit percentage revenue growth in 2025. For Q2, it projected revenue to be $7.4 billion, plus or minus $300 million, representing 27% growth. Given its potential growth opportunities, AMD also plans to increase investments in its product and technology roadmaps.

Turning back to AMD's Q1 results, the company saw overall revenue rise by 36% to $7.44 billion. Adjusted earnings per share (EPS) surged 55% to $0.96. The results topped the analyst consensus of EPS of $0.94 on sales of $7.13 billion, as compiled by LSEG.

Client and gaming segment revenue rose 28% to $2.9 billion, with client revenue soaring 68% to $2.3 billion. The growth was driven by its new high-end Ryzen CPUs, which saw strength in gaming desktop PCs and AI-powered notebooks. Gaming revenue fell 30% to $647 million due to lower semi-custom revenue. The video game console cycle is pretty long in the tooth at this point, but growth for this segment should skyrocket once new consoles are introduced, likely in late 2027 or 2028. Embedded segment revenue, meanwhile, fell 3% to $823 million.

Is the stock a buy?

While the export restrictions on China throw a bit of a wrench in AMD's growth story, the company is otherwise seeing very good momentum in the data center space. It's the market share leader in server CPUs, which should continue to be a solid, growing market.

However, the company's biggest long-term opportunity may lie in the growing demand for AI chips focused on inference rather than training. AMD's GPUs have already carved out a solid position in the inference segment, which should help drive growth given that the inference market is expected to surpass training in size over time.

With its stock trading at a forward price-to-earnings ratio (P/E) of 26.5 times 2025 analyst estimates and at about 18 times 2026 estimates, AMD's valuation has come down a lot over the past year and is now at an attractive level.

AMD PE Ratio (Forward) data by YCharts.

Given the potential AI opportunities in front of AMD, I think now could be a good time to begin accumulating shares of the stock. If the company can grab market share in the inference market, AMD stock should have a lot of upside from here.

Should you invest $1,000 in Advanced Micro Devices right now?

Before you buy stock in Advanced Micro Devices, consider this:

The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Advanced Micro Devices wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years.

Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you’d have $617,181!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $719,371!*

Now, it’s worth noting Stock Advisor’s total average return is 909% — a market-crushing outperformance compared to 163% for the S&P 500. Don’t miss out on the latest top 10 list, available when you join Stock Advisor.

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*Stock Advisor returns as of May 5, 2025

Geoffrey Seiler has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Advanced Micro Devices and Nvidia. The Motley Fool has a disclosure policy.

The stock market remains volatile but not quite as frantic as earlier this year. Meanwhile, the major market indexes remain well below their recent highs.

Against this backdrop, now is a great time to invest in high-quality exchange-traded funds (ETFs) that track indexes. ETFs are a collection of assets that trade as a single unit and are a great place for new and experienced investors alike because they bring instant diversification with the flexibility to be traded like a single stock.

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And $500 is a great starting point -- but just that. The key to investing, particularly with ETFs, is to contribute consistently over time. It's a strategy known as dollar-cost averaging, where you regularly invest a set amount at a specific time. This could be with each paycheck or on a particular day of the month.

It is important to stick with this strategy, whether the market is up or down. Down markets are a great time to pick up stocks on the cheap and get a better cost basis.

And you should continue to do so even in bull markets, which tend to last a long time. In fact, according to a JPMorgan Chase study, since 1950, the S&P 500 hit a new all-time high on 7% of its trading days, and on a third of those days, the index never dropped lower.

Let's look at three great index ETFs you can begin to invest in right now.

The Vanguard S&P 500 ETF

One of the most popular ETFs in the world is the Vanguard S&P 500 ETF (NYSEMKT: VOO), and for good reason. As the name says, it tracks the roughly 500 largest companies that trade on a U.S. stock exchange. The index is market-cap weighted, which means that the larger a company's value, the bigger part of the portfolio it occupies.

And as with most Vanguard ETFs, it comes with a minuscule expense ratio. Even seemingly low expense ratios, such as 1%, eat into returns over time, especially as your investments grow in size. The Vanguard ETF's expense ratio is only a scant 0.03%.

With this Vanguard ETF, investors get an instant portfolio of the companies that have grown to become some of the world's largest. The index is also generally considered the benchmark for the U.S. stock market as a whole.

The ETF has a long history of solid returns. Over the past decade, it has generated an average annual return of 12.3%, as of the end of April.

The Vanguard Growth ETF

Sticking with Vanguard and its low costs, the Vanguard Growth ETF (NYSEMKT: VUG) is another great option. It mimics the CRSP US Large Cap Growth Index, which is essentially the growth side of the S&P 500. It has a similarly low expense ratio of 0.04%.

The Vanguard Growth ETF gives you an instant portfolio of many of the large-cap growth stocks that have been helping drive the market over the past several years. It is heavily weighted toward the tech sector, which makes up about 57% of its holdings. And some very tech-heavy companies, such as Amazon and Tesla, are categorized into other sectors.

If you're looking for exposure to the so-called "Magnificent Seven" stocks (Apple, Alphabet, Amazon, Meta Platforms, Microsoft, Nvidia, and Tesla), this ETF is a good option. At the end of last quarter, these seven stocks accounted for over 50% of its holdings.

This fund has been a strong long-term performer, generating a 14.5% return over the past 10 years, as of the end of April.

The Invesco QQQ ETF

Beating the returns of the S&P 500 is not an easy task, but one ETF that has been able to consistently outperform it is the Invesco QQQ ETF (NASDAQ: QQQ), which tracks the performance of the Nasdaq 100. Like the other indexes mentioned above, the Nasdaq 100 is also market-cap weighted. It contains the 100 largest nonfinancial stocks on the exchange.

That index has historically attracted fast-growing companies, particularly in the technology sector. As such, it is also very heavily weighted toward tech, checking in at a similar 57% to the Vanguard Growth fund.

The Invesco ETF has been the best performer of these three over the past decade, with an average annual return of nearly 17% over the past 10 years, as of the end of April. And this has not been just from a couple of big years of outperformance. On a rolling 12-month basis, it has outperformed the S&P 500 more than 87% of the time over the past decade (for the period ended March).

It carries a 0.2% expense ratio, but its consistent outperformance over the years more than justifies its higher cost.

Should you invest $1,000 in Vanguard S&P 500 ETF right now?

Before you buy stock in Vanguard S&P 500 ETF, consider this:

The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Vanguard S&P 500 ETF wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years.

Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you’d have $617,181!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $719,371!*

Now, it’s worth noting Stock Advisor’s total average return is 909% — a market-crushing outperformance compared to 163% for the S&P 500. Don’t miss out on the latest top 10 list, available when you join Stock Advisor.

See the 10 stocks »

*Stock Advisor returns as of May 5, 2025

Suzanne Frey, an executive at Alphabet, is a member of The Motley Fool’s board of directors. Randi Zuckerberg, a former director of market development and spokeswoman for Facebook and sister to Meta Platforms CEO Mark Zuckerberg, is a member of The Motley Fool's board of directors. John Mackey, former CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool’s board of directors. JPMorgan Chase is an advertising partner of Motley Fool Money. Geoffrey Seiler has positions in Alphabet, Invesco QQQ Trust, and Vanguard S&P 500 ETF. The Motley Fool has positions in and recommends Alphabet, Amazon, Apple, JPMorgan Chase, Meta Platforms, Microsoft, Nvidia, Tesla, Vanguard Index Funds - Vanguard Growth ETF, and Vanguard S&P 500 ETF. The Motley Fool recommends the following options: long January 2026 $395 calls on Microsoft and short January 2026 $405 calls on Microsoft. The Motley Fool has a disclosure policy.

Berkshire Hathaway (NYSE: BRK.B) (NYSE: BRK.A) has been a tremendous investment since the stock went public back in 1980. During that span, the insurance-led conglomerate has had only one chief executive officer: Warren Buffett. Buffett would prove himself to be one of the greatest investors of all time during his tenure at Berkshire.

However, Buffett shocked shareholders when he announced at the company's annual shareholder meeting that he would step down from the CEO role at the end of the year. Taking his place will be Greg Abel, his long-appointed successor and current head of Berkshire's energy division. Buffett will, however, stay on as a member of Berkshire's board.

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Unlike Buffett, Abel is not a renowned investor. Instead, his strength lies in his operating expertise and being a shrewd dealmaker. He made a string of acquisitions to help turn a sleepy Iowa utility into a major power production and pipeline company that is now called Berkshire Hathaway Energy. Meanwhile, he has been running Berkshire's non-insurance businesses since 2018.

However, Abel will not be running Berkshire's huge investment portfolio. That job will fall to Todd Combs and Ted Weschler, whom Buffett brought on to help run that side of the business several years ago. Ajit Jain, meanwhile, will continue to run the day-to-day business of Berkshire's insurance operations.

A lot of cash and a new CEO

Buffett will leave his CEO role at Berkshire, leaving behind an unmatched legacy. He created a unique model for the insurance industry where he eschewed investing Berkshire's insurance float in safe, fixed-income investments, instead investing it in stocks. Float is the money that insurance companies collect in premiums and hold until a claim is paid out.

This decision, combined with Buffett's investment acumen, has created an enormous amount of shareholder value over the years. Buffett has a long-term investment focus, and he would buy stakes in companies he believed were undervalued that have the ability to keep compounding for decades. One of his most famous investments is Coca-Cola, which Berkshire began buying in 1988 and still holds today.

Buffett also leaves Abel and Berkshire Hathaway with a tremendous stockpile of cash. Buffett began selling stocks last year ahead of the market sell-off, while also ending the company's buyback program. Together with increased operating profits, Berkshire ended the first quarter with a whopping $347.7 billion in cash on its balance sheet.

Despite the recent market volatility, Buffett also didn't seem eager to run out to buy stocks ahead of stepping down as CEO. He told investors that Berkshire will eventually find places to invest its cash, but that "it's very unlikely to happen tomorrow." However, he noted that it would likely find someplace to invest in the next five years. He has shrugged off the recent market downturn, saying it hasn't been a dramatic bear market.

Unless a great investment comes along in the next eight months, it looks like Abel will have a large cash hoard when he steps in as CEO. How he allocates that money will be interesting, but it likely will be different than if Buffett were CEO. After all, Buffett is a stock picker, and Abel is an operator.

Instead of investing in stocks, I would expect Abel to be on the lookout to buy entire businesses. I wouldn't be surprised if he sold some Berkshire businesses, as well. The conglomerate has nearly 200 disparate businesses, ranging from railroads to ice cream parlors. Buffett collected a lot of undervalued businesses with little to no synergies, while at MidAmerican Energy, Abel went out and made synergistic acquisitions that positioned the company to be one of the largest utility companies in the U.S.

This strategy shift would not be a bad thing, but it would certainly be much different than how Berkshire was run in the past.

Is Berkshire stock a buy?

Buffett is also leaving Berkshire with a pretty high stock valuation. The stock currently has a price-to-book (P/B) ratio of 1.7, which is one of the highest levels during the past decade. Buffett even stopped buying back Berkshire stock mid-year last year due to its high valuation.

BRK.B Price to Book Value data by YCharts.

When Buffett is no longer CEO, there's also a good chance that the Buffett premium in the stock will start to wane. In the past, Buffett would only buy back stock when it traded at a P/B below 1.2 times, so if the stock were to return to about this level, it could have some meaningful downside from current levels.

With Buffett appearing unlikely to use his cash stockpile anytime soon and a potential shift in its overall investment strategy (more toward buying operating businesses than stocks), my prediction is that this won't be the same Berkshire Hathaway stock in the years to come.

Should you invest $1,000 in Berkshire Hathaway right now?

Before you buy stock in Berkshire Hathaway, consider this:

The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Berkshire Hathaway wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years.

Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you’d have $623,103!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $717,471!*

Now, it’s worth noting Stock Advisor’s total average return is 909% — a market-crushing outperformance compared to 162% for the S&P 500. Don’t miss out on the latest top 10 list, available when you join Stock Advisor.

See the 10 stocks »

*Stock Advisor returns as of May 5, 2025

Geoffrey Seiler has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Berkshire Hathaway. The Motley Fool has a disclosure policy.

One of the biggest hurdles for investors interested in buying Palantir Technologies (NASDAQ: PLTR) stock has been its high valuation. But it can overcome this by continuing to accelerate its revenue growth and grow into that valuation.

While the stock price sank following its Q1 results, the company once again showed accelerated revenue growth in the quarter and raised its revenue outlook for the year. However, with a high valuation comes high expectations, and while it was a very strong report, it wasn't perfect.

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Accelerating revenue growth

The first quarter of 2025 marked the seventh straight time that Palantir has seen its quarterly revenue growth accelerate. During that span, growth increased from 13% in fiscal 2023's Q2 to 39% last quarter. Meanwhile, its Q1 revenue of $883.9 million easily surpassed management's forecast of $858 million to $862 million.

Metric	Q2 '23	Q3 '23	Q4 '24	Q1 '24	Q2 '24	Q3 '24	Q4 '24	Q1 '25
Revenue growth	13%	17%	20%	21%	27%	30%	36%	39%

Source: Palantir quarterly reports.

Palantir's artificial intelligence platform (AIP) continues to be its primary growth driver, particularly with U.S. commercial customers. The company credited AIP's ontology, or the operational layer for AI that connects digital assets (data sets and models) to their real-world counterparts (products or orders).

It said AIP is entering its next phase of production, in which customers can use its platform to create AI agents to help drive enterprise autonomy. It cited examples of insurance giant AIG using AI underwriting agents built on its platform, as well as a hospital, Tampa General, using AI agents to monitor for sepsis. It also noted that customers are starting to expand rapidly, quickly moving on from boot camps or pilots to sign multi-year contracts.

As a result, U.S. commercial revenue soared 71% to $255 million in the quarter. Meanwhile, its U.S. commercial remaining deal value, which refers to revenue it will recognize in the future from contracts already signed, surged 127% to $2.32 billion.

On the government side of its business, revenue climbed 45% year over year to $487 million. U.S. government revenue increased by 45% to $373 million. The company said it remained confident that it was well-positioned to navigate the current federal budget cuts, noting that this should highlight the value of its offerings. Therefore, it expects to garner bigger budget allocations within the Department of Defense and other agencies.

Revenue growth on the international government side also rose 45% to $114 million. The company highlighted its new deal with NATO and its continued work with the U.K. healthcare system.

One weak spot, however, was with international commercial customers. Revenue for this group fell 5% to $141 million. Palantir said it continues to see headwinds in Europe, while it is looking to capitalize on opportunities in Asia and the Middle East. However, its top priority remains the U.S. On its earnings call, when asked about Europe, Palantir said the region "doesn't get AI yet."

Net dollar retention, which measures revenue growth from existing customers that have been with the company for more than a year, was 124%. A number above 100% indicates expansion. This metric was up from 120% last quarter and demonstrates the continued growth the company is having within its existing customer base.

Adjusted earnings per share (EPS), meanwhile, rose from $0.08 to $0.13 year over year. That was only in line with the analyst EPS consensus, as compiled by the London Stock Exchange Group.

Looking ahead, the company guided for full-year 2025 revenue of between $934 million and $938 million, representing growth of 38% at the midpoint. It also raised its full-year revenue guidance, taking it from a range of $3.741 billion to $3.757 billion to a new range of $3.890 billion to $3.902 billion, representing 36% growth.

Is it time to buy the dip?

As noted at the beginning, one of the biggest issues surrounding Palantir is its valuation. The stock trades at a forward price-to-sales (P/S) ratio of 66 times 2025 analyst estimates and just below 52 times 2026 estimates.

Data by YCharts.

That's just a very high valuation. However, if the company can keep growing its revenue at around a 40% clip per year, it can grow into its current multiple. At that rate, it would get to around $15 billion in revenue in 2029 for a P/S multiple of 17 in just over three years. Continue that growth further out, and it would get Palantir close to $30 billion in revenue in 2031, which in around five years would give it a forward P/S multiple of 8.5.

So the recent double-digit percentage dip in the stock could be a buying opportunity, with the caveat that the company must continue its current pace of revenue growth over the next several years. Given how the company has positioned itself as an AI operating system for AI agents, I don't think this scenario is far-fetched. The company has a lot of momentum; now it just needs to keep it.

Should you invest $1,000 in Palantir Technologies right now?

Before you buy stock in Palantir Technologies, consider this:

The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Palantir Technologies wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years.

Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you’d have $623,103!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $717,471!*

Now, it’s worth noting Stock Advisor’s total average return is 909% — a market-crushing outperformance compared to 162% for the S&P 500. Don’t miss out on the latest top 10 list, available when you join Stock Advisor.

See the 10 stocks »

*Stock Advisor returns as of May 5, 2025

Geoffrey Seiler has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Palantir Technologies. The Motley Fool has a disclosure policy.

Intel's (NASDAQ: INTC) first-quarter results came up flat, and investors sent shares of the struggling semiconductor company lower. Intel shares are down more than 40% over the past year.

Revenue was flat for the quarter, coming in at $12.7 billion. Adjusted earnings per share (EPS) sank 28% to $0.13. The lackluster numbers easily surpassed the $0.01 in EPS and $12.3 billion in revenue in the analyst consensus compiled by LSEG, but Intel's guidance disappointed.

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Let's take a closer look at Intel's quarterly results to see when a turnaround could be in store.

Intel's struggles continue

Intel's flat revenue was the first time it didn't see a revenue decline since Q1 of last year. However, the company has been more stuck in the mud in regard to revenue growth than seeing any big declines.

Intel's product revenue fell 3% to $11.8 billion. Its client computing group (CCG) product revenue fell 8% to $7.6 billion, while data center and AI (DCAI) product revenue rose 8% to $4.1 billion. The company said it saw better-than-expected sales of its Xeon chip, which is a CPU (central processing unit) designed for data centers and enterprise services. However, it said the growth was likely driven by customers increasing orders ahead of tariffs.

Its foundry business, meanwhile, had revenue increase 7% to $4.7 billion. However, the segment continues to post large losses, with an operating loss of $2.3 billion in Q1. That was a slight improvement from its $2.4 billion loss a year ago.

Revenue from Intel's other businesses, which include subsidiaries Altera and Mobileye, shot up 47% to $900 million. This segment also flipped from an operating loss of $170 million to a profit of $103 million.

Segment	Revenue	Revenue Growth (YOY)
Product	$11.8 billion	(3%)
--CCG	$7.6 billion	(8%)
--DCAI	$4.1 billion	8%
Foundry	$4.7 billion	7%
Other (subsidiaries)	$900 million	47%

Data source: Intel. YOY = year over year.

Gross margins remain under pressure, falling by 410 basis points from 41% to 36.9%. Some of the gross-margin pressure stems from ramping up the foundry business, but Intel has also seen a lot of margin pressure in its CCG and DCAI businesses as well.

The company produced $813 million in operating cash flow during the quarter, while spending $5.2 billion in capital expenditures (capex) as it continues to pour money into its foundry business. It ended the quarter with $50.2 billion in debt against $21.1 billion in cash and short-term investments.

Looking ahead, it forecast Q2 revenue to range between $11.2 billion and $12.4 billion, well below analyst expectations for revenue of $12.8 billion. At the midpoint, that would be a year-over-year decline in revenue of about 8%.

Due to its struggles, Intel is looking to significantly cut its operating expenses (opex). It plans to reduce opex to $17 billion this year and $16 billion in 2026. Excluding restructuring charges, opex was $22 billion in 2024, or $19.4 billion when excluding share-based compensation.

Meanwhile, it reduced its capex budget by $2 billion to $18 billion, and it plans to monetize noncore assets. This will begin the process of improving its balance sheet.

Is a turnaround near?

The simple answer to that question is no. None of this is a quick fix, and Intel won't be able to just cut its way to prosperity. On that front, it plans to refine its artificial intelligence (AI) strategy with the goal of developing full-stack AI solutions that improve accuracy, power efficiency, and security. That's a great goal to have, but Intel will have difficulty competing with a company like Nvidia, which is currently leaps and bounds ahead of it and has created a wide moat with the CUDA software platform.

That said, I think there's value to be unlocked within Intel. Its core business, while not growing, has been fairly steady on the revenue front, and I would expect gross margins to eventually start to plateau. The company has a lot of physical assets, as it's poured money into its foundry business, building new fabrication plants in both the U.S. and Europe. It has spent over $200 billion in capex over the past two years, which is more than twice its market cap.

As a result, Intel trades at a ratio of price to tangible book value (TBV) of just 1.2. TBV is the value of its physical assets minus any net debt, so basically, at current prices, investors are able to buy Intel at around the value of its assets.

INTC Price to Tangible Book Value data by YCharts.

Investors will need to be patient, but I think there's enough value in Intel for its stock to eventually work. That means you might consider accumulating shares now, and on any further dips.

Should you invest $1,000 in Intel right now?

Before you buy stock in Intel, consider this:

The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Intel wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years.

Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you’d have $594,046!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $680,390!*

Now, it’s worth noting Stock Advisor’s total average return is 872% — a market-crushing outperformance compared to 160% for the S&P 500. Don’t miss out on the latest top 10 list, available when you join Stock Advisor.

See the 10 stocks »

*Stock Advisor returns as of April 28, 2025

Geoffrey Seiler has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Intel and Nvidia. The Motley Fool recommends Mobileye Global and recommends the following options: short May 2025 $30 calls on Intel. The Motley Fool has a disclosure policy.