For more than two years, nearly any stock tied to artificial intelligence (AI) was sizzling hot. That's no longer the case. Several AI stocks have plunged by double-digit percentages so far in 2025.
Should investors throw in the towel? Not if they don't want to miss out on potentially huge returns. I like quite a few AI stocks, but here are my top picks to buy right now.
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Some see Google parent Alphabet (NASDAQ: GOOG) (NASDAQ: GOOGL) as something of a dead company walking. They think generative AI presents an existential threat to Google Search. They believe regulators will seriously hamper Google's ability to compete. I not only disagree; I view Alphabet as a fantastic AI stock for long-term investors.
Importantly, Alphabet isn't running and hiding from generative AI. Instead, the company is embracing it. Chatbot Arena ranks Google Gemini version 2.5 Pro as the No. 1 overall large language model (LLM) as well as the best at math, instruction following, creative writing, handling longer queries, and more. Gemini is already incorporated into Google Search through AI Overviews, which is driving higher search usage and user satisfaction.
Thanks in part to Gemini, Google Cloud is the fastest-growing cloud services provider among the major players. I expect the unit to remain an important growth driver for Alphabet in the future.
I also like Alphabet's Waymo self-driving car business. UBS predicts that Waymo is poised to dominate the fast-growing autonomous ride-hailing (robotaxi) market. The investment bank believes that Waymo is so far ahead that most of the world's automakers will eventually adopt its technology.
Google Cloud is the fastest-growing cloud services provider, but Amazon (NASDAQ: AMZN) is the biggest with its Amazon Web Services (AWS) unit. I think AWS will continue its reign and continue to grow rapidly, even if the pace of growth is lower than some of its rivals.
Amazon CEO Andy Jassy said in the company's fourth-quarter earnings call, "[I]t's hard to overstate how optimistic we are about what lies ahead for AWS' customers and business." He predicted that nearly every app will incorporate generative AI within the next few years, with most companies using AI agents. I believe his vision of the future is spot on. And I agree with Jassy that AWS is well-positioned to be one of the top winners.
While Amazon is an AI leader in its own right, it's also a major investor in one of the top up-and-coming AI innovators -- Anthropic. I'm bullish about Amazon's stake in Anthropic. The smaller company's Claude ranks as one of the most powerful AI models around. Anthropic also recently announced it has made important breakthroughs in understanding how LLMs think, which could pave the way for developing even better models.
I'd be remiss if I didn't mention Amazon's e-commerce business. Although the company is the 800-pound gorilla in e-commerce, I think it still has plenty of room to grow. Amazon's AI initiatives should help improve profitability and make its ecosystem more sticky for customers.
Nvidia (NASDAQ: NVDA) stock has been absolutely hammered this year. Does this present a buying opportunity? I think so.
Sure, Nvidia's growth is slowing. The company faces challenges from Chinese regulators and the Trump administration's trade policies. Competition is increasing for Nvidia's GPUs, including from customers such as Amazon and Google.
Despite these issues, though, the fact remains that Nvidia makes the most powerful AI chips available. Its new Blackwell platform should drive robust growth this year, with newer technology on the way soon.
There's also one positive side effect of Nvidia's steep sell-off: Its valuation looks much more attractive. Granted, Nvidia's shares still trade at over 25 times forward earnings. However, its price-to-earnings-to-growth (PEG) ratio is a reasonable 1.1. I think investors who buy this AI stock on the pullback will be glad they did within a few years.
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John Mackey, former CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool's board of directors. Suzanne Frey, an executive at Alphabet, is a member of The Motley Fool's board of directors. Keith Speights has positions in Alphabet and Amazon. The Motley Fool has positions in and recommends Alphabet, Amazon, and Nvidia. The Motley Fool has a disclosure policy.