2 Artificial Intelligence Stocks That Remain Excellent Long-Term Buys After the DeepSeek News

Chinese start-up DeepSeek rocked the artificial intelligence (AI) market when it announced one particular accomplishment. The company said it trained its model in two months for less than $6 million. This is compared to the billions of dollars big tech companies are pouring into their AI programs. Immediately, investors worried this would prompt the tech giants to rein in spending and follow in the footsteps of DeepSeek -- and that would weigh on the revenue of many AI companies, such as chip powerhouse Nvidia.

But a closer look at the situation paints a brighter picture. Tech companies aren't likely to change their spending strategy overnight, and experts have even said that DeepSeek probably spent more on the project than it originally announced. Consultant SemiAnalysis says the figure looks more like $500 million, and that's just for the chips to power the training.

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But whether DeepSeek's news is game changing or not, certain AI stocks still remain excellent long-term buys and aren't likely to be hurt by the company's progress. Let's check out these two AI players to buy now.

Image source: Getty Images.

1. Amazon

Amazon (NASDAQ: AMZN) is benefiting from AI across its two businesses: e-commerce and cloud computing. In e-commerce, it uses AI to streamline operations, for example, by identifying the best delivery routes for packages. In cloud computing, it develops and sells a variety of AI products and services.

In fact, the cloud unit, Amazon Web Services (AWS), already has reached a $115 billion annual revenue run rate thanks to the company's push into AI. AWS has gone all in on AI, offering customers everything from the basics, like chips, to a fully managed service that offers them popular large language models (LLMs) tailored to their needs. On top of this, AWS also develops AI applications, such as Amazon Q, an AI assistant for software development.

Customers can come to Amazon for premium chips, such as those sold by Nvidia, but the company also has developed its own line of chips for the cost-conscious customer. Known as Trainium, they can be 30% to 40% more economical for computing in the cloud than other chip options, Amazon says.

And since AWS is the world's leading cloud player, it already has a solid customer base. These are customers that may find it very convenient to opt for AWS, a service they know well, for AI projects.

Today, Amazon trades for 36 times forward earnings estimates, down from about 44 times just a few weeks ago, offering you a fantastic entry point for this top long-term stock.

2. Meta Platforms

You may know Meta Platforms (NASDAQ: META) best as a social media giant as it owns Facebook, Messenger, WhatsApp, and Instagram. But the company also has become a major player in the world of AI. It's trained its own LLM, known as Llama, and is working toward several big AI goals. And to potentially reach these AI goals, the company can't rely on a small AI budget.

Chief Executive Officer Mark Zuckerberg has been vocal for quite some time about the company's AI ambitions and the need for aggressive spending to achieve them. In fact, just a couple of weeks ago, he said Meta would invest as much as $65 billion in infrastructure this year and expand its AI teams too. Meta also said that by the end of the year, the company would have more than 1.3 million graphics processing units (GPUs) on board.

All of this should help Meta as it marches toward goals such as the development of an AI assistant for all of its users. The company already offers Meta AI, the most used assistant globally. How does this translate into revenue? Meta generates sales through advertisers that pay to reach users on Meta's apps. Meta assistants could increase their time spent on Meta, and that means advertisers will have even more reason to spend here to contact users. And Meta's AI leadership could lead to other products, services, and revenue opportunities down the road.

All of this makes Meta look particularly cheap today, trading at 28 times forward earnings estimates, especially for investors who aim to hold on to the shares as this long-term story develops.

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Randi Zuckerberg, a former director of market development and spokeswoman for Facebook and sister to Meta Platforms CEO Mark Zuckerberg, is a member of The Motley Fool's board of directors. John Mackey, former CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool's board of directors. Adria Cimino has positions in Amazon. The Motley Fool has positions in and recommends Amazon, Meta Platforms, and Nvidia. The Motley Fool has a disclosure policy.