AI Boom: Top Stocks to Consider for Your Portfolio

An updated edition of the June 18, 2026, article.

Artificial Intelligence (AI) is reshaping digital transformation by enabling systems to process massive volumes of data, recognize complex patterns, and generate intelligent insights and decisions. Advances in generative AI, agentic AI, multimodal models, and high-performance computing — supported by increasingly powerful GPUs and Tensor Processing Units (TPUs) — are accelerating AI adoption across industries. Applications ranging from conversational assistants and medical diagnostics to fraud detection and autonomous systems are helping organizations improve productivity, strengthen decision-making, increase operational agility, and unlock new avenues for innovation and growth.

Per Gartner, global AI spending is expected to hit $2.596 trillion in 2026, indicating 47% growth over 2025. IDC projects AI infrastructure spending to reach $487 billion in 2026 and is expected to hit $1 trillion in 2029, seeing a CAGR of 31% between the 2025-2029 time frame. U.S. tech giants, including Microsoft MSFT, Alphabet, Amazon AMZN and Meta Platforms META, have been at the forefront of bringing remarkable advances to AI technology, well supported by powerful AI chips and custom accelerators from NVIDIA, Advanced Micro Devices AMD, and Broadcom. Growing demand for complex AI chips bodes well for KLA KLAC due to the growing requirement for greater inspection and intense process control.

Enterprise-focused AI agents continue to gain traction across productivity, software development, customer service and business automation applications. Latest AI model releases are focusing on improved reasoning, coding assistance, multimodal understanding and safety. However, Chinese AI model developers like Alibaba are challenging U.S. tech giants by launching much cheaper models with almost the same performance. 

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3 AI Stocks to Buy Right Now

Amazon is benefiting from AI both directly through its cloud arm Amazon Web Services (AWS) and indirectly because AI workloads stimulate consumption of its traditional cloud infrastructure. This Zacks Rank #1 (Strong Buy) stock is benefiting from strong AI spending. You can see the complete list of today’s Zacks #1 Rank stocks here.

AI applications require storage, databases and CPUs in addition to accelerators. Post-training, reinforcement learning and agentic tool use often run on CPUs, while AI applications also need storage and vector databases. Consequently, as customers increase AI spending, Amazon sees a corresponding increase in AWS core consumption.

Amazon is also monetizing virtually every layer of the AI infrastructure stack. At the silicon layer, the company’s Trainium AI accelerators and Graviton CPUs have become sizable businesses. Amazon’s overall chip business has surpassed a $25 billion annual revenue run rate. Anthropic and OpenAI have made multiyear, multi-gigawatt Trainium commitments, while additional startups and enterprises are adopting the chips.

AI is also improving Amazon’s non-AWS businesses. Alexa for Shopping has been used by more than 350 million customers over the past year while active users nearly doubled in the second quarter of 2026 and interactions increased more than fivefold year over year. 

AMD is one of the more direct beneficiaries of rising AI compute demand. In the second quarter of 2026, AMD’s Data Center revenues increased 107% year over year to a record $6.7 billion, representing 58% of company revenues versus 42% in the year-ago quarter. Growth was driven by both EPYC server CPUs and Instinct AI accelerators, illustrating that AI demand is expanding AMD’s opportunity beyond GPUs alone. Management characterized the industry as being in the early stages of a multiyear AI adoption cycle that is creating demand for substantially more compute.

AMD’s Instinct accelerator franchise is driving top-line growth. Data Center AI revenues more than doubled year over year as customers broadened deployments of MI355x accelerators across training and inference. This Zacks Rank #1 company is now moving toward complete rack-scale AI systems with Helios, which combines MI450 GPUs, EPYC Venice CPUs, Pensando networking and ROCm software. AMD said Helios can deliver up to 15% greater inference throughput at the same rack power and up to 30% more tokens per dollar than competing solutions, with customer demand tracking ahead of its initial forecast.

AMD is also securing large, multiyear deployments with leading AI companies including OpenAI, Meta, Anthropic and Microsoft.

Another Zacks Rank #1 company, KLA, sells the inspection, metrology and process-control equipment semiconductor manufacturers need to produce increasingly complex AI chips at acceptable yields. This is driving up top-line growth as KLA generated record fourth-quarter fiscal 2026 revenues of $3.66 billion. Management specifically cited accelerating AI infrastructure investment, leading-edge foundry/logic spending and increasing process-control intensity in memory and advanced packaging as major drivers.

AI chips require more advanced logic, high-bandwidth memory (HBM) and increasingly sophisticated packaging. Each of these makes semiconductor manufacturing more difficult and increases the economic importance of detecting defects and improving yields. KLA said AI infrastructure requires more advanced logic and memory, new complex manufacturing and packaging flows, and additional KLA systems and services to ramp and sustain high-volume production.

HBM and advanced packaging are particularly important. KLA expects its advanced-packaging process-control systems revenues to reach roughly $1.1 billion in calendar 2026, up more than 70% year over year, nearly twice the growth rate of the broader advanced-packaging market.

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This article originally published on Zacks Investment Research (zacks.com).

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