Investor interest in generative AI has been unmatched recently. And companies that engage in innovation in artificial intelligence (AI) technology and other cloud-based services have exploded.
The stock market is already in a bullish environment due to the increased potential that the Federal Reserve will begin to start cutting interest rates later this year, following a reduction in overall inflation.
In addition, the tech industry, most notably companies that play a major role in AI innovation, has sent the market to even greater heights.
Below are a few companies on the cutting edge of AI technology that have seen impressive share price appreciation and growing investor enthusiasm, which makes them strong investment options.
Salesforce (CRM)
Salesforce (NYSE:CRM) offers cloud-based services that give a more detailed view of a company’s customer base and other strong metrics such as forecast sales growth, sales data and improved workflow options through a number of applications.
Similar to other stocks, like Meta Platforms (NASDAQ:META), Salesforce recently announced an initial quarterly dividend of forty cents per share, which is a sign that CRM is in a strong financial position.
Its share price has increased by over 60% in the last year following earnings results that have beaten analyst expectations and the rollout of new products such as the Einstein Copilot, which helps streamline business communication using AI technology.
On Feb. 28, Salesforce reported earnings for the fourth quarter of fiscal year 2024, in which it stated that total revenue increased by 11% year-over-year. Share buybacks totaled $1.7 billion in the fourth quarter, and it reported the authorization of another $10 billion in repurchases.
Salesforce is a giant within the expanding generative AI and cloud computing industries. It continues to offer investors strong and consistent growth potential.
ServiceNow (NOW)
ServiceNow (NYSE:NOW) is a company that focuses on automation for digital businesses. It uses a wide variety of tools, such as robotic automation, artificial intelligence and cloud services, to assist with improved workflow productivity.
It reported earnings on Jan. 24 for the fourth quarter full year 2023, in which it stated that subscriber revenue increased by 27% and net income nearly doubled compared to the year before.
On Mar. 18, ServiceNow announced that it would acquire 4Industry — an application software company based in the Netherlands that is a partner of ServiceNow — and EY Smart Daily Management Application to improve its innovation capabilities.
Over this past year, its share price has risen by more than 75% following strong earnings results and improved automation. It is a stock poised for future growth because it is a strong contender within the highly competitive industry and exhibits robust fundamentals.
Advanced Micro Devices (AMD)
Advanced Micro Devices (NASDAQ:AMD) is a semiconductor and processor manufacturer with products such as the AMD Ryzen, AMD Athlon, AMD Threadripper and AMD Radeon, which have been used particularly in data centers and gaming development.
AMD, like other semiconductor companies, has seen increased growth this year due to the huge boom in AI and cloud based technology, leading to a greater need for chips used within data centers and other similar applications.
On Jan. 30, AMD released its earnings for the fourth quarter of the full year 2023, stating that total revenue increased by 10% year-over-year. Net income surged from $21 million in Q4 2022 to $667 million in Q4 2023. Most notably, its data center revenue grew by 38% within the previously mentioned time period. Other areas saw earnings improvement, such as the gaming and client segments, which saw a 17% and 62% increase, respectively.
AMD’s share price has increased by over 85% within the last year. It is a solid option for investors who prefer a cheaper alternative to Nvidia (NASDAQ:NVDA), which also carries impressive growth potential.
As of this writing, Noah Bolton did not hold (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.