"There are numerous ways to bet on AI (artificial intelligence). But two paths are particularly intriguing: the AI technology suppliers and the beneficiaries of AI at scale. In other words, you can buy the company selling the "picks and shovels," or the chips and systems powering AI. Or, alternatively, you can invest in a company that integrates AI into existing products, services, and infrastructure used by billions of people."
"In its third quarter of fiscal 2026 (the period ending Oct. 26), Nvidia reported revenue of $57.0 billion, up 62% year over year. Data center revenue -- the part of the business most tied to AI servers -- was $51.2 billion, up 66%. And capturing the company's pricing power, Nvidia's gross margin for the period was a staggering 73.4% on a generally accepted accounting principles (GAAP) basis."
Two distinct investment paths in AI exist: suppliers of AI technology (chips and systems) and scaled beneficiaries that integrate AI into widely used products and infrastructure. Nvidia exemplifies the supplier path with extraordinary recent results: fiscal 2026 Q3 revenue of $57.0 billion (up 62% year over year), data-center revenue of $51.2 billion (up 66%), a 73.4% GAAP gross margin, and EPS growth. Management noted cloud GPUs were sold out at period end. Alphabet exhibits clear AI-driven momentum alongside broad-based strength across multiple lucrative businesses, representing the scaled platform beneficiary of AI adoption.
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