The last two years have been dominated by artificial intelligence (AI) stocks. The influx of spending on AI infrastructure and development, combined with investors' excitement aro

Artificial intelligence continued to be a driving force behind stock market returns in 2024. Here are some of the stocks that have benefited the most.

A rate-cutting campaign by the Federal Reserve, a resilient economy and strong corporate earnings provided another solid backdrop for the stock market in 2024. After a stellar 2023, it was a great year for growth stocks in the software space like Palantir Technologies and AppLovin after the S&P 500 and Nasdaq composite confirmed new uptrends in early November 2023 with one-day gains of more than 1.

Two of the hottest artificial intelligence (AI) stocks heading into 2025 are Palantir Technologies (NASDAQ: PLTR) and SoundHound AI (NASDAQ: SOUN). Both stocks had a phenomenal 2024, with Palantir's stock up almost 400% and SoundHound AI's gaining nearly 900%.

Seemingly overnight, artificial intelligence became a major growth industry. The AI boom is driving demand for semiconductors, which are crucial components in AI systems. Two compelling semiconductor companies to consider are Wolfspeed (NYSE: WOLF) and Advanced Micro Devices (NASDAQ: AMD).

There was a “shift from putting out models to actually building products,” said Arvind Narayanan, a Princeton University computer science professor and co-author of the new book “AI Snake Oil: What Artificial Intelligence Can Do,

But investors looking to add some AI stocks to their portfolio have plenty of other options. And two other companies look far more attractive than the richly valued Palantir. In fact, I predict both will be worth more than Palantir by the end of 2025, as a result of strong relative price performance to 2024's big winner.

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