The five largest hyperscalers (owners of massive data centers) alone are set to spend more than $700 billion on artificial intelligence (AI) infrastructure this year. That’s a massive amount that is more than the gross domestic product (GDP) of most countries.
Let’s look at three AI stocks well-positioned to benefit from this spending.
Will AI create the world’s first trillionaire? Our team just released a report on the one little-known company, called an “Indispensable Monopoly” providing the critical technology Nvidia and Intel both need. Continue »
As the undisputed leader in AI infrastructure, Nvidia (NASDAQ: NVDA) is certainly one of the companies best positioned for this AI data center spending spree. The company has already been putting up tremendous growth, with its revenue surging eightfold over the past three years to $215.9 billion for the fiscal year 2026 ended in January. Its revenue continues to grow at a rapid pace, climbing 73% year over year last quarter.
Nvidia has established itself as the muscle behind AI workloads with its graphics processing units (GPUs). However, the company is now much more than just chips. Its networking portfolio has actually been its fastest-growing business, with revenue skyrocketing 264% last quarter to $11 billion. Nvidia is now offering end-to-end AI server solutions, which should help it capture even more of this AI spending.
At the same time, the stock is attractively valued, trading at a forward price-to-earnings (P/E) ratio of 22 times based on current fiscal-year analyst estimates.
For GPUs and other AI chips to perform at their best, they need to be packaged with a special form of dynamic random-access memory (DRAM) called high-bandwidth memory (HBM). With demand for AI chips soaring, so is demand for HBM. Meanwhile, these components are in short supply. Not only is HBM manufacturing more complex, but it also requires upwards of three times the wafer capacity of ordinary DRAM. This has left the entire DRAM market in tight supply, which has been increasing prices.
As one of the big three DRAM makers, along with Korean companies Samsung and SK Hynix, Micron Technology (NASDAQ: MU) is well-positioned to benefit from this trend. The company saw its revenue jump 57% year over year last quarter, while even more importantly, its gross margins soared from 38.4% a year ago to 56%. That’s leading to huge gains in profit and cash flow.
Meanwhile, Micron’s stock is inexpensive due to its historically cyclical nature, trading at a forward P/E of just 11.5 times fiscal 2026 analyst estimates (ending in August) and just over 8.5 times the fiscal 2027 consensus. Micron has been seeking longer-term contracts for HBM, and if the company can shake off some of the cyclicality of its business, given the huge secular growth of AI infrastructure, then the stock could have a lot of upside from here.
