AI may be popular, but it's not a short-term investment. Choosing quality AI players and holding them over the long term while they participate in an AI revolution could provide a bigger win. This technology could change several industries. These modifications won't come instantly, so AI players can profit throughout.
Because they power AI projects, two firms are good long-term AI acquisitions. Without these companies' products and services, many programs might not run as well. These companies provide AI's processors, servers, and other behind-the-scenes components, and their profits have soared.
Nvidia's (NASDAQ: NVDA) GPUs are crucial to AI. They power training and inference, which are essential for AI models to solve complicated problems. Despite having the fastest GPUs, Nvidia isn't complacent. Research and development are its strategies to stay ahead.
Work is paying off. Nvidia plans to deliver its H200 chip in the second quarter and its Blackwell chip architecture and B100 chip later this year. Nvidia dominates the AI processor industry with 80%, and its brand strength and innovation will likely maintain it that way.
Even better, Nvidia sells chips and a wide range of AI products and services through the world's largest cloud providers including Amazon Web Services (AWS) and Microsoft Azure. Nvidia's AI platform and expertise make it the go-to source for organizations developing projects in this area. This knowledge has helped Nvidia claim triple-digit sales and net income. Nvidia shares have soared, but they still sell at 36x times projected profit forecasts, a fair price in this high-growth industry.
Super Micro Computer Another hidden AI powerhouse is Super Micro Computer (NASDAQ: SMCI). The company has been operational for 30 years, but its AI business has boosted profitability and share performance recently. AI users can get servers, workstations, whole rack scale solutions, and more from Supermicro.
A few factors distinguish Supermicro. The company uses a building block design to swiftly develop solutions for clients using similar parts across platforms. This lets it use cutting-edge technology in its goods. Supermicro collaborates with the world's top chipmakers, notably Nvidia, to learn about impending chip launches and incorporate the newest technologies into their products.
Customers can customize their orders with Supermicro's wide range of options. All of this helped Supermicro win the AI market. Recently, the corporation reported its first $3 billion quarter, surpassing 2021 sales.
Chief Executive Officer Charles Liang said the company's many customer wins are driving demand. Liang predicts AI growth for several quarters and years. If he's accurate, earnings and share prices may be just beginning. Supermicro trades at 54x EPS forecasts. This may sound expensive, but it's fair for a vital player in a fast-growing business. Supermicro's unique strategy may enable this player win long-term.
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