AI Stocks: 9 Biggest Companies in 2024
Artificial intelligence (AI) may be an emerging technology, but there are plenty of billion-dollar companies in this space.
As the market has grown over the past few years, AI technology has made strong inroads into several key industries, including logistics, manufacturing, finance, healthcare, customer service and cybersecurity.
While AI-driven advancements in robotics have received the most press in recent years, the largest buzz has centered around OpenAI’s ChatGPT. This intelligent chatbot shows how quickly generative AI is advancing, and has attracted the attention of heavyweight technology companies such as Microsoft (NASDAQ:MSFT), which has reportedly invested billions of dollars in the privately held OpenAI. Alphabet (NASDAQ:GOOGL) has also released its own AI chat tool, Google Gemini.
On a global scale, Fortune Business Insights predicts that the AI industry will experience a compound annual growth rate of 20.4 percent between 2024 and 2032 to reach a market value of more than US$2.74 trillion.
American AI stocks
According to Tracxn Technologies, the number of US AI companies has more than doubled since 2017 with over 82,541 companies working in the sector today.
One of the major factors fueling growth in the American AI market, states Statista, is “the growing investments and partnerships among technology companies, research institutions, and governments.’
Below are three of the top US AI stocks organized by market cap.
1. Microsoft (NASDAQ:MSFT)
Market cap: US$3.188 trillion
Share price: US$428.91
In addition to the reported billions Microsoft is committed to investing in OpenAI, the technology behemoth has built its own AI solutions based on the chatbot creator’s technology: Bing AI and Copilot. OpenAI officially licensed its technologies to Microsoft in 2020.
An update to Windows 11 in 2023 integrated the Bing chatbot into the operating system’s search bar, allowing users to interact with the chatbot directly with Microsoft’s Edge browser, Chrome and Safari.
Microsoft’s moves into generative AI have translated into higher revenues for its Azure cloud computing business and a higher market capitalization as the tech giant pushed past the US$3 trillion mark in January 2024.
In late May, Microsoft unveiled its Copilot+ Windows PCs, the company’s first range of AI PCs, which the company says are the “fastest, most intelligent Windows PCs ever built.”
After receiving criticism over security flaws, Microsoft announced in late September that it has made changes to the Copilot+ exclusive Recall software, which uses AI to create screenshots of everything users do on their computers.
2. NVIDIA (NASDAQ:NVDA)
Market cap: US$2.95 trillion
Share price: US$120.05
The global leader in graphics processing unit (GPU) technology, NVIDIA is designing specialized chips used to train AI and machine learning models for laptops, workstations, mobile devices, notebooks, and PCs. The company is partnering with a number of big name tech firms to bring a number of key AI products to market.
Through its partnership with Dell Technologies (NYSE:DELL), NVIDIA is developing AI applications for enterprises, such as language-based services, speech recognition and cybersecurity. The chip maker has been instrumental in the build out of Meta Platforms’ (NASDAQ:META) AI supercomputer called the Research SuperCluster, which reportedly uses a total of 16,000 of NVIDIA’s GPUs.
In the first quarter, Taiwan Semiconductor Manufacturing Company (NYSE:TSM) and NVIDIA released the world’s first multi-die chip specifically designed for AI applications: the Blackwell GPU. Blackwell’s architecture allows for the increased processing power needed to train larger and more complex AI models.
In early June, NVIDIA saw its market cap zoom past the US$3 trillion mark to surpass that of Apple (NASDAQ:AAPL). On June 18, its valuation jumped to as high as US$3.34 trillion to briefly pass Microsoft before pulling back. In Q4 2024, the GPU giant is expected to produce 450,000 Blackwell AI chips worth a potential US$10 billion in revenue.
3. Alphabet (NASDAQ:GOOGL)
Market cap: US$2.03 trillion
Share price: US$164.29
Alphabet holds court with both Microsoft and NVIDIA as part of the tech sector’s Magnificent 7, and its foray into AI has similarly brought the tech giant much success. Alphabet’s market cap surpassed the US$2 trillion mark in April.
The company has its AI chatbot Gemini, formerly known as Bard, which is integrated into products such as its Google Suite, the Chromecast browser and Google Pixel phone line.
In early April, Google introduced a custom AI chip designed for its cloud services customers. Set to be delivered later this year, the technology uses British semiconductor company Arm Holding’s (NASDAQ:ARM) AI architecture. In the same week, Google revealed its new A3 Mega AI processor based on NVIDIA’s H100 Technology.
More recently, Google partnered with automaker Volkswagen (OTC Pink:VLKAF,ETR:VOW) to launch a smartphone app-integrated AI assistant for VW drivers.
Canadian AI stocks
Recognized as a world-leading AI research hub, Canada ranks eighth out of 83 countries in the Global AI Index. Since 2017, the Canadian government has invested hundreds of millions of dollars into accelerating the research and commercialization of AI technology in the country through the Pan-Canadian Artificial Intelligence Strategy.
Research by IBM (NYSE:IBM) says Canadian businesses are increasingly adopting AI, with 37 percent of IT professionals in large enterprises reporting that they have deployed the technology in their operations.
Below are three of the top Canadian AI stocks by market cap.
1. CGI (TSX:GIB.A)
Market cap: C$34.93 billion
Share price: C$154.55
Montreal-based CGI is among the world’s largest IT systems integration companies, and offers a wide range of services, from cloud migration and digital transformation to data analysis, fraud detection and even supply chain optimization. Its more than 700 clients span the retail, wholesale, consumer packaged goods and consumer services sectors worldwide.
Through a partnership with Google, CGI is leveraging the Google Cloud Platform to strengthen the capabilities of its CGI PulseAI solution, which can be integrated with existing applications and workflows.
CGI is aggressively working to expand its generative AI capabilities and client offerings, and is reportedly planning to invest US$1 billion into its AI offerings. In early March, the company launched Elements360 ARC-IBA, an AI powered platform for brokers and insurers to settle accounts in the UK broking industry.
In September, CGI signed the European Union’s Artificial Intelligence Act pledge to work for trustworthy and safe AI development.
2. OpenText (TSX:OTEX)
Market cap: C$12.15 billion
Share price: C$44.78
Ontario-based OpenText is one of Canada’s largest software companies. The tech firm develops and sells enterprise information management software. Its portfolio includes hundreds of products in the areas of enterprise content management, digital process automation and security, plus AI and analytics tools. OpenText serves small businesses, large enterprises and governments alike.
OpenText’s AI & Analytics platform has an open architecture that enables integration with other AI services, including Google Cloud and Azure. It can leverage all types of data, including structured or unstructured data, big data and the internet of things to quickly create interactive visuals.
Early in the year, OpenText launched its Cloud Editions 24.1, which includes enhancements to its OpenText Aviator portfolio.
‘Leveraging AI for impactful results depends on reliable data – without it, even the most skilled data scientists will struggle,” OpenText CEO and chief technology officer Mark J. Barrenechea stated. “By expanding the Aviator portfolio in conjunction with our world class information management platform, Cloud Editions 24.1 empowers customers with the tools and insights needed to get ahead.’
3. Descartes Systems Group (TSX:DSG)
Market cap: C$12.08 billion
Share price: C$138.10
Descartes Systems Group provides on-demand software-as-a-service (SaaS) solutions. The multinational technology company specializes in logistics software, supply chain management software and cloud-based services for logistics businesses.
AI and machine learning enhancements to Descartes’ routing, mobile and telematics suite are helping the company’s customers optimize fleet performance.
“AI and ML are perfect extensions to our advanced route optimization and execution capabilities,” Ken Wood, executive vice president at Descartes, said. “From dynamic delivery appointment scheduling through planning and real-time route execution, we’ve used AI and ML to improve our ability to deliver the next level of fleet performance for customers.”
Australian AI stocks
AI investment by Australian companies is projected to increase by 67 percent in 2024, according to BSI’s International AI Maturity Model, which would make the country the second best market in the world in terms of boosting AI capabilities. The biggest spenders when it comes to AI in Australia are the banking industry, the federal government, professional services and retail.
Below are three of the top Australian AI stocks by market cap.
1. Xero (ASX:XRO)
Market cap: AU$22.52 billion
Share price: AU$148.72
New Zealand-based technology company Xero provides cloud-based accounting software for small- and medium-sized businesses. The company’s product portfolio also includes the Xero Accounting app, Xero HQ, Xero Ledger, Xero Workpapers and Xero tax tools.
Xero has made a number of AI enhancements to its platform in recent years, including bank reconciliation predictions that save time and reduce errors, and Analytics Plus, a suite of AI-powered planning and forecasting tools.
In March, the company launched its Gen AI assistant, named Just Ask Xero, or JAX. Some of its features include the automation or streamlining of repetitive and time-consuming tasks; the ability to anticipate tasks based on previous user actions and the ability to make cashflow projections on request.
2. TechnologyOne (ASX:TNE)
Market cap: AU$7.84 billion
Share price: AU$23.80
TechnologyOne is another large enterprise technology software firm in Australia. In fact, it is the country’s largest enterprise resource planning SaaS company. TechnologyOne has a client base of over 1,200, including customers in the government, education, health and financial services sectors across Australia, New Zealand and the UK. The company’s research and development center is targeting cloud-based technology, artificial intelligence and machine learning.
Municipalities such as Shoalhaven in the UK are using TechnologyOne AI-based SaaS solutions to manage city services, including waste management and road maintenance.
TechnologyOne’s H1 2024 financial results for its fiscal period ended March 31 highlighted its 15th year of record first half revenue, profit and SaaS fees.
3. Weebit Nano (ASX:WBT)
Market cap: AU$351.38 million
Share price: AU$1.86
Israeli semiconductor IP company Weebit Nano develops silicon oxide-based resistive random-access memory (ReRAM) technologies. The company seeks to address the need for significantly higher-performance and lower-power computer memory technology.
Weebit’s products can be used to enable edge AI applications and AI systems such as neuromorphic computing. An advancement in AI and machine learning, neuromorphic computing is based on architectures designed to function in the same way as the human brain’s operation.
Weebit says its ReRAM cell “functions similarly to a synapse in the brain, making it a promising solution for neuromorphic computing.” The company is collaborating with research partners in academia and industry to further develop the use of ReRAM for neuromorphic computing.
FAQs for AI stocks
Which company is leading the AI race?
Google and Microsoft are battling it out for king of the AI hill. While Goldman Sachs sees Alphabet’s Google as leading the AI race, other analysts are pointing to Microsoft as the clear frontrunner. Microsoft stands to benefit in a big way from its billions of dollars investment in OpenAI’s ChatGPT as advancements in generative AI may have the potential to increase the company’s revenues for its Azure cloud computing business.
Which country is doing best in AI?
North America is the global hotspot for advancements in AI technology and is home to the majority of the world’s largest AI providers. Of the countries in this region, Canada’s AI industry is showing the fastest growth, according to a report by Deloitte. Techopedia positions the US as the primary hub for AI development, and many of the world’s leading tech giants are headquartered there. According to the report, China comes in a close second.
What is Elon Musk’s AI company?
In November 2023, Elon Musk launched Grok, a new AI technology company based in Nevada. Musk said he was starting it as a ‘third option’ to ChatGPT and Google Gemini. Its Grok chatbot, originally called TruthGPT, is included on Musk’s platform X, formerly known as Twitter.
Does Tesla have its own AI?
Tesla (NASDAQ:TSLA) has developed proprietary AI chips and neural network architecture. The company’s autonomous vehicle AI system gathers visual data in real time from eight cameras to produce a 3D output that helps to identify the presence and motion of obstacles, lanes and traffic lights. The AI-driven models also help autonomous vehicles make quick decisions. In addition to developing autonomous vehicles, Tesla is working on bi-pedal robotics.
Securities Disclosure: I, Melissa Pistilli, hold no direct investment interest in any company mentioned in this article.
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