Imagine not fearing the disruption wrought by artificial intelligence (AI) and instead growing richer from the game-changing innovations the technology creates. This isn't just possible for tech nerds or billionaire hedge-fund managers. You, too, could build vast wealth by investing in tomorrow's AI-powered titans.
But you must choose your investments wisely.
To help you with your search for these fortune builders, read on to learn more about two pioneering companies with some of the most cutting-edge AI in the world today.
AI stock to buy No. 1: Palo Alto Networks
AI will be built in the cloud. Palo Alto Networks (PANW -1.23%) is helping companies defend their most critical cloud networks. The cybersecurity leader is using AI to bolster its customers' defenses at a time when the cost of cyber hacks is exploding, and preventing breaches is becoming only more critical.
Failure to protect valuable trade secrets or sensitive client data can result in devastating financial losses, regulatory penalties, and reputational damage. You only need to take a quick glance at the cost estimates for CrowdStrike's outage earlier this year to understand the extent of potential losses. The rival cybersecurity provider's system failures are expected to cost its customers a staggering $5.4 billion.
With its competitor reeling, Palo Alto's standing atop the cyber defense industry should be further secured. CrowdStrike's troubles will likely also fuel Palo Alto's gains. The cloud guardian is already growing at an impressive clip. Palo Alto's annual recurring revenue for its next-generation security offerings jumped by 43% year over year to $4.2 billion in the quarter ended July 31.
Palo Alto's platform-based approach is clearly resonating with customers. With its next-generation firewalls, advanced threat prevention tools, and array of ancillary cybersecurity solutions, Palo Alto provides a more simplified and seamlessly integrated offering than alternatives that seek to combine a host of single-service providers. In this way, it's able to decrease the complexity of its clients' security systems and shorten their incident response times.
Palo Alto's scale helps to widen its competitive moat. The cloud sentinel collects a massive amount of data from its over 80,000 corporate customers, which enables its machine learning technology to perpetually grow more intelligent. And once its AI-driven platform identifies a new danger, it quickly updates its safeguards to shield its customers from the threat.
These advantages position Palo Alto to claim a larger share of a rapidly expanding cybersecurity market that's set to exceed $500 billion by 2030, according to Grand View Research. Invest in Palo Alto's stock today, and you could profit handsomely alongside this leading AI-powered cloud defender.
AI stock to buy No. 2: Palantir Technologies
Like Palo Alto Networks, Palantir Technologies (PLTR -3.72%) is becoming an invaluable AI partner to a growing number of businesses and government organizations. The analytics specialist is helping its customers harness valuable insights from their data faster than ever before.
Palantir's award-winning machine learning technology can identify patterns from a wide array of data sources. Its software enables real-time operational decisions by integrating AI into its customers' daily workflows.
Palantir's AI-powered solutions are prized by the U.S. military and its allies. The Department of Defense awarded Palantir a contract valued up to $480 million to bring its AI-enabled decision-making tools to battlefield commanders and senior staff. Ukraine's government, meanwhile, is using Palantir's software to accelerate its demining efforts.
Companies are also flocking to Palantir's new Artificial Intelligence Platform (AIP). Power management giant Eaton is using AIP to bolster its data management and resource planning capabilities. Palantir is also helping restaurant chain Wendy's digitize its supply chain and accelerate its adoption of AI-driven automation.
Additionally, Palantir recently expanded its partnership with Microsoft. The two tech leaders are working together to bring a suite of advanced AI applications and analytic capabilities to U.S. defense and intelligence agencies.
These deals are hastening Palantir's expansion. Its adjusted operating income leaped by 37% year over year to $254 million in the second quarter, driven by a 27% jump in revenue to $678 million. That marked a significant acceleration from the 21% revenue growth the AI leader delivered in the first quarter. An 83% surge in U.S. commercial customers should fuel more profit gains for Palantir and its shareholders in the year ahead.
