Top 7 AI Stocks Set to Boom in 2023

Top Artificial Intelligence Stocks To Buy Now: The second half of the 20th century saw a world transformed by incremental advances in computer technology.

First, there were computers that took up entire rooms – only large businesses, educational institutions, and government agencies were able to own one. The machines got smaller, faster, and more powerful every year, and by the time the calendar rolled over to the 21st century, there were computers in every home and office.

During the first decade of the 21st century, the internet expanded. Digital tools and services began disrupting industries, and by the end of the decade, smartphones were going mainstream. The next ten years delivered more sophisticated digital ecosystems, and cloud computing became the next transformative technology.

Now, in the third decade of the 21st century, tech companies aren’t neglecting smart devices and cloud computing, but they have a new goal. They intend to harness the power of Artificial Intelligence (AI) to deliver yet another transformation – this time, one capable of diagnosing and curing disease quickly and effectively, creating safer transport through autonomous vehicles, and supporting dozens of other applications that remove risk, increase efficiency, and reduce the need for human involvement in repetitive tasks.

The work isn’t easy, and AI is still in the early stages of development. It will be years before this technology is fully integrated into daily life. However, when the tech companies succeed – and they will – those that build the most effective Artificial Intelligence will realize tremendous growth.

These seven companies are leading the Artificial Intelligence industry with innovative solutions to the challenges that come with building a machine that thinks like a human. That puts them on the shortlist for AI stocks set to boom in 2023.

What Is Artificial Intelligence?

Movies, books, and television shows have explored the concept of Artificial Intelligence from many angles. Favorite depictions of AI include self-driving cars, sometimes with the ability to have conversation with the driver.

There have also been loveable lifelike robots complete with powerful computer “brains” that are capable of making decisions that strike a perfect balance between logic and humanity.

True AI applications – at least the versions available today – aren’t designed to impersonate humans. However, they are designed to take on increasingly complex tasks that require a certain amount of independent decision making.

They are also expected to complete tasks that require machines to perceive and infer information based on data that humans typically collect through their senses – vision, touch, and hearing.

For example, AI technology is being developed to manage real-time chats in customer service settings and to manage security through the interpretation of visual data collected through security cameras. The ability to carry on an effective conversation or interpret the meaning of actions viewed through electronic surveillance requires experience. To be more accurate, it requires the ability to learn from experience and apply learning to future interactions.

Standard computing relies on programming that tells the machine what to do in each situation, but conversations are unpredictable – and so are complicated tasks like driving, interpreting actions viewed on video, or evaluating health risks at the cellular level.

It’s impractical, if not impossible, to program computers for every possible variable that might occur in these situations, so the machine must be capable of deciding next steps independently based on knowledge and experience.

This is where “machine learning” comes in. Developers essentially teach technology to make independent decisions rather than waiting for instructions. This is accomplished by feeding the machine massive amounts of data that it can access and leverage for decision-making. Artificial Intelligence identifies patterns in the data and uses those patterns to make predictions and take action.

When predictions are inaccurate, the technology “learns” from its errors to inform future decisions. While computers have yet to duplicate the sophistication and nuances of human brains, huge advances have been made in teaching computers to function like humans in limited situations.

Mainstream examples of artificial intelligence in action include digital assistants like Apple’s Siri, Amazon’s Alexa, and Microsoft’s Cortana. Auto manufacturers such as Audi, Mercedes-Benz, Tesla, Toyota, and Volvo have incorporated AI into their vehicles for specific tasks like automated parking, and autonomous vehicles are already on the roads of major cities.

AI is being used by the healthcare industry for dull tasks like insurance claims processing, but the technology’s true potential goes far beyond increasing administrative efficiency.

Physicians are using AI to review medical imaging and triage patients, as well as to identify the more promising areas of research for new therapies. AI is already capable of predicting kidney disease earlier than traditional methods, and it is being trained to forecast the path of chronic diseases.

Some emergency rooms are using AI now to recognize symptoms of certain acute conditions like heart attacks. As the technology continues to gain experience and “learn,” it will become even more effective across a broader spectrum of life-threatening health conditions. It goes without saying that the companies developing this technology are well-positioned to profit with each new advance.

So, which AI stocks will go up in 2023? These are the seven that industry experts have on their watch lists.

Why Did Google Buy DeepMind?

Alphabet’s Google search engine and related products, including Gmail and Google Maps, remain the gold standard in their respective categories. Google has a near-monopoly on the search engine market worldwide, and that means control of the advertising dollars that come along with popular sites.

The company doesn’t intend to rely on search engine advertising indefinitely. Google expanded into social media with the acquisition of YouTube back in 2006, and Alphabet is on the cutting edge of cloud computing. Google Cloud holds the third-largest share of the cloud computing market, behind Amazon Web Services (AWS) and Microsoft Azure.

Alphabet relies on search engine advertising revenue to support other divisions for now, but that isn’t intended to be a permanent strategy. In addition to expanding its cloud computing client list and increasing digital ad revenues, Alphabet intends to lead the way in Artificial Intelligence through its wholly owned subsidiary DeepMind.

DeepMind Technologies wasn’t originally a Google project. It was founded in Great Britain by a team of engineers, neuroscientists, and mathematicians in 2010 – a time when most developers still considered Artificial Intelligence to be unattainable with the available technology.

DeepMind took a unique approach to AI, and there were dramatic successes early on. For example, one AI program taught itself to play 49 video games on the Atari platform, and another AI program was the first ever to win a match against a professional Go player.

In 2014, before Google reorganized and Alphabet launched, DeepMind agreed to be acquired. Google wanted the company for its innovation in AI, and DeepMind wanted the advantages of Google’s vast resources. Since the companies joined forces, DeepMind has continued to deliver state-of-the-art AI technology that is specifically designed to benefit humankind.

For example, DeepMind AI has learned to diagnose diseases of the eye as well as any physician, and it can predict the complex 3D shapes of proteins – a key step in the development of new drugs.

Of course, Alphabet leverages the power of AI to improve the efficiency and effectiveness of its existing products. That includes AI applications that improve the accuracy of the arrival times predicted by Google Maps and reduce the battery power used for the Android Pie phone operating system.

Alphabet hasn’t released many DeepMind AI products for use by consumers because it is focused on perfecting the technology before bringing it to market. As a result, DeepMind struggled to turn a profit for years. It is very expensive to employ the field’s top minds, so it wasn’t until 2020 that the company finally got out of the red.

In 2022, a small group of industry experts suggested that Alphabet was falling behind the competition. A chatbot known as ChatGPT enjoyed a brief period of notoriety, and some said the AI chatbot would eventually replace Google’s search engine.

Alphabet barely acknowledged the “threat,” and most believe that it is quietly preparing its own chatbot. In mid-January, business news agencies reported that the Sparrow chatbot could be released in 2023 to complement Google’s search engine, along with MedPaLM – an AI-powered chatbot to support the needs of physicians and other healthcare providers.

Alphabet has the resources to lead the AI industry – and that isn’t limited to its massive $1.25 trillion market cap.

Though other areas of the company – and the tech industry as a whole – are experiencing staffing cuts and layoffs, Alphabet has prioritized the retention of a highly-skilled AI development team that has the knowledge, experience, and expertise to create the future of Artificial Intelligence.

Is Amazon A Leader In AI?

Amazon didn’t create an e-commerce empire with 20th century technology. Its ability to capture a majority of the US e-commerce market and a sizable portion of online shopping in the rest of the world is a testament to its commitment to innovation.

AWS, the global leader in cloud computing, was the first platform to offer cloud computing services. The idea was born as an internal solution during a particularly tricky period in Amazon’s early years, and it has gone on to become one of the company’s biggest money-makers.

Amazon has developed and incorporated Artificial Intelligence throughout the e-commerce business. AI is responsible for everything from the recommendations that shoppers see to the customer service chatbots that are remarkably capable of managing basic and semi-complex issues. Amazon is one of the few companies to successfully launch a mainstream digital assistant. Hundreds of millions of Alexa-enabled devices have been sold to date.

The use of AI throughout Amazon’s operations isn’t an accident. It’s by design – specifically, a flywheel.

The company is organized around Artificial Intelligence in that the machine learning that forms the foundation of Amazon AI efforts is leveraged to guide other aspects of the business. For example, when customers use Alexa to look up a recipe, AI uses that information to make purchasing recommendations.

Every new development in Amazon’s AI is shared with the rest of the organization to be integrated into other processes. That, in turn, leads to more innovation, which is also shared company-wide, and the cycle continues.

In other words, no single team is in charge of AI development. It’s a company-wide effort that ensures faster advances and rapid adoption of new features. The method has been so successful that Amazon has been tapped to teach organizations like the NFL and NASA how to make the most of Artificial Intelligence.

AWS customers have access to a wealth of AI-powered tools, from image and video analysis to automated speech recognition. Healthcare facilities on the AWS platform can use AI to extract data from unstructured text, and industrial clients can add AI-enhanced diagnostics capable of automatically detecting abnormal machine conditions.

Amazon isn’t going to be a leader in Artificial Intelligence at some point in the future. It’s already an AI leader right now. The company has the resources necessary for continuous improvement of its existing technology, and it has the infrastructure in place to deploy cutting-edge advances throughout its own organization as well as client organizations.

It’s likely that Amazon is hard at work on new consumer products that showcase Artificial Intelligence technology, but generally speaking, the company is far more practical. Instead of focusing on a single AI goal like self-driving cars, it is deploying the newest AI real-time to solve real-world problems.

For example, Amazon just released a robotic arm that promises to transform warehouse operations, and it is developing a drone delivery system that will cut the high cost of getting products from warehouses to customer doorsteps.

For investors, the key point is that using and selling these AI-based tools boosts Amazon’s top and bottom-line results in a meaningful way, which makes Amazon one of the top AI stocks set to boom in 2023.

What Does C3.AI Actually Do?

Alphabet and Amazon may have the global branding and financial resources to overshadow their competition in the Artificial Intelligence space, but that doesn’t give them a monopoly on innovation. Many brilliant minds are hard at work on perfecting AI to solve the world’s toughest problems, and C3.AI has some of the best talent in the industry.

C3.AI was founded in 2009 by technologist Thomas Siebel (net worth $3.2 billion) who is best-known for his enterprise software company, Siebel Systems. He sold Siebel Systems to Oracle in 2006, then decided to pursue his passion for AI.

With a market cap of roughly $1.5 billion, C3.AI is tiny compared to the trillion-dollar tech giants. Nonetheless, it is gaining a reputation as a driving force behind AI advances.

Among other goals, C3.AI is focused on making AI deployment simple and affordable for businesses of all sizes. The company offers more than 40 turnkey AI-powered enterprise applications capable of supporting a variety of industries, including government agencies, manufacturers, financial services providers, and defense contractors.

Clients like Raytheon, Cargill, Shell, and the United States Air Force leverage C3.AI products to bring their own operations into the 21st century.

For example, in 2022, Shell partnered with C3.AI to implement an AI predictive maintenance system that manages 10,000 pieces of equipment.

The US Air Force relies on C3.AI to ensure its fleet of aircraft is ready for action by predicting subsystem failure before a mission, identifying any need for spare parts, and communicating opportunities to proactively prepare the mission for success.

The beauty of C3.AI’s approach to supporting clients is that it takes the mystery, guesswork, and fear of wasted resources out of the AI equation.

Businesses don’t have to research available AI resources, determine whether they can be tailored for specific needs, and manage acquisition, installation, deployment, and maintenance of AI technology. Instead, C3.AI reviews clients’ needs, makes recommendations, and manages the entire project from start to finish.

That value proposition is hard to beat, which is why C3.AI is widely considered one of the seven companies to watch for investors who want to buy the best AI stocks. However, there is a downside – the company isn’t yet turning a profit.

The last 12 months have been hard on most tech stocks, and the growth stocks were hardest hit. C3.AI is down almost 90 percent from its December 2020 IPO. Revenue growth has been nearly flat over the past year, as many businesses paused their investment in new technology.

Growth investors who can tolerate risk and have confidence in the future of Artificial Intelligence or Tom Siebel’s ability to build another profitable business (or both) are using Warren Buffett’s approach to buying stock. They believe C3.AI shares are significantly undervalued, so they are taking advantage of the opportunity to “be greedy when others are fearful” and buying C3.AI stock.

Is Palantir The Best AI Company?

Like C3.AI, Palantir was founded with the understanding that most organizations aren’t prepared to handle the many steps involved in successful deployment of AI solutions.

The process of researching available technology, making a purchase, and then installing, launching, training, and maintaining is too much. More often than not the entire project is scrapped partway through, wasting time and money.

Palantir’s approach is to act as an AI concierge. Palantir experts evaluate clients’ needs, suggest solutions, and seamlessly deploy the technology.

As Palantir puts it, “Our platforms provide the matrix for end-to-end MLOps, propelling AI/ML out of the experimental vacuum and into the real world.”

Better still, Palantir solutions allow for incremental integration of Artificial Intelligence when complete overhauls aren’t practical. The company identifies and addresses a single component of a larger process through AI, and over time, a series of these micro-solutions can be linked to create an end-to-end AI-enhanced process.

Palantir is widely known as a leader in the AI space, and that reputation was cemented when Forrester, an independent research and advisory firm, recognized Palantir as “a leader in artificial intelligence and machine learning.”

The company’s approach to bringing the power of Artificial Intelligence to companies of all sizes, in all industries is appealing to investors. That’s a massive addressable market, which suggests that Palantir is one of the AI stocks set to boom in 2023.

What Is Microsoft Doing In Artificial Intelligence?

Microsoft pioneered computing in the second half of the 20th century, and it continues to play a critical role in the industry today. Therefore, it comes as no surprise that Microsoft is on the cutting edge of Artificial Intelligence research and application.

Like the Google Cloud and Amazon Web Services platforms, Microsoft’s Azure cloud computing service makes a collection of AI-powered tools and resources available to its clients.

Azure AI is credited with increasing efficiency and operational effectiveness in a number of major organizations, including the NBA, Airbus, Walgreens-Boots Alliance, and Twitter.

However, Microsoft has never been content to sit on the sidelines while other companies innovate. It has a number of AI-related research and development projects in process. While many are intended to bring more affordable and effective AI tools to businesses, a significant portion of the company’s AI research is devoted to building a better world.

Among other solutions, there is an AI-powered chatbot dedicated to addressing the gap in mental health services, and there are new AI tools to make learning, work, and independent living accessible to people with disabilities.

Microsoft is one of the few companies dedicated to preserving cultural heritage worldwide, and it has committed resources to the deployment of Artificial Intelligence to preserve culturally significant places and artifacts, as well as protect important languages that aren’t widely spoken.

Much of Microsoft’s AI work has been in the background, and the company is often left out of AI industry leader lists. But it’s a mistake to count Microsoft out of the running for leadership in the Artificial Intelligence space. Microsoft has the money to buy what it doesn’t have in its own research and development pipeline, and it has created a number of partnerships with young, innovative AI startups.

For example, Microsoft has a stake in Open AI’s ChatGPT, the chatbot some believe will make Google search obsolete. More importantly, Microsoft has released GitHub Copilot, an AI tool that makes coding suggestions alongside developers. It is intended to limit the need for coders to spend their time on menial, repetitive tasks so they can devote more energy to the truly creative aspects of the work.

Eventually, Microsoft wants to create AI copilots for other professions, and that’s what has AI investors excited. First, Microsoft computers transformed the workplace, then its Office products simplified complex tasks like managing data, creating presentations, and organizing communications so that everyone could benefit from computing technology.

Now, AI professional assistants may transform the workplace again by taking basic transactional tasks out of the equation so humans have more time to create and innovate. In short, Microsoft is a smart bet when it comes to AI stocks set to boom in 2023.

Does Workday Use Artificial Intelligence?

As of December 2022, there were 131.81 million full-time employees in the United States and tens of millions more working part-time, as contractors, or as gig workers. Payroll is the number one expense for every employer in America, and the same holds true nearly everywhere in the world.

The process of hiring workers, managing their payroll and benefits, and dealing with training, development, regulatory compliance, and dozens of other tasks requires tremendous investment of resources, from HR managers to develop and apply policies and procedures to software capable of recording hours and calculating compensation.

HR software isn’t a new idea. Oracle’s PeopleSoft launched in 1987, and for many years, it controlled most of the Human Capital Management market. Workday wasn’t released until 2006, but it began pulling market share away from PeopleSoft almost immediately. Today, it holds roughly 25 percent of the Human Capital Management market, and its market share is growing.

What is new about Workday technology is this: in addition to traditional HR functions, Workday uses Artificial Intelligence to analyze data, make decisions, and perform routine tasks. That translates into tremendous benefits for employers and employees alike.

Employers are able to transition basic transactions away from HR professionals, so that the human HR managers can focus on planning, strategy, employee relations, and employee engagement.

Better still, AI-powered HR analytics tools can identify inefficiencies, such as poor scheduling practices or ineffective processes, so leadership can take appropriate action.

On the employee side, smart HR systems reduce errors in payroll, benefits, and similar. More importantly, employees don’t have to wait for answers or follow up on promised adjustments. They can rely on AI-powered software to provide accurate information and timely responses to queries.

Workday is a leader in Human Capital Management, and it is rapidly gaining a reputation for leadership in Artificial Intelligence. Investors like the fact that market share is going up, margins are increasing, and there is seemingly no limit to the addressable market. By those measures, Workday certainly belongs on the list of best AI stocks for 2023.

Is Nvidia Leading AI?

Engineers and programmers bring critical skills to the table when it comes to taking Artificial Intelligence from science fiction to reality. However, their ability to build machines and write the code that makes AI function is useless without advanced hardware capable of supporting the design. That’s where Nvidia comes in.

Nvidia supplies the components that form the foundation necessary for building every AI application. Its high-performance computing technology makes it possible to examine and manipulate information quickly – a must for AI to succeed.

Nvidia powers the metaverse with high-performance chips that can support virtual worlds. It offers the hardware, tools, and algorithms that make automated speech recognition possible, connect data to recommend solutions, and allow machines to “see.”

Awareness of the external environment, or “vision” is a crucial skill for vehicles to be fully autonomous, and it has long been the biggest obstacle to the development of true self-driving cars. Nvidia’s technology has successfully given automobiles the power of “sight,” along with the ability to think through options and learn from errors so they can navigate the unpredictability of traffic.

Nvidia is committed to expanding AI use cases, so it embeds machine learning into GPUs and select software. For example, Nvidia was one of the first to leverage machine learning to enhance the quality and sound of video conferencing in real time.

The company’s goal is to make that sort of AI-powered automatic issue resolution standard across industries and applications by introducing deep learning to every connected device.

That goal is achievable with cloud computing – Nvidia introduced NVIDIA DGX systems, the world’s first portfolio of purpose-built AI supercomputers. Data scientists from anywhere in the world with an internet connection can access the power necessary to power machine learning and develop custom Artificial Intelligence solutions.

While all of that contributes to Nvidia’s leadership position in the Artificial Intelligence industry, the company’s primary contribution comes down to its exceptionally powerful chips.

In 2022, Nvidia launched the H100 “Hopper” processor, a chip so powerful that the US government restricted sales of these chips to Russia and China for national security reasons.

The exceptional power in these chips will make AI research and AI reactions faster, opening the door to new AI solutions. For example, there is a lot of interest in AI that can translate speech from one language to another in real-time. It appears that the H100 processor may finally offer the power needed for such a complex activity.

In short, Nvidia is a world leader in Artificial Intelligence because it builds the hardware that makes AI possible. That fact, in addition to Nvidia’s other industry-leading products and services, puts Nvidia on the list of the best artificial intelligence stocks to buy now.

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