Two AI Stocks Poised to Surge in the Second Half of 2025

Artificial intelligence (AI) stocks were the market's biggest winners last year as investors flocked to this area of great opportunity. Analysts predict the AI market will reach trillions of dollars in the coming years, suggesting early players in the field could benefit significantly. However, this investing theme lost momentum temporarily a couple of months ago due to tariff concerns and economic uncertainties. Recently, investors have become more optimistic as initial trade deals and positive economic data have calmed fears. This bodes well for growth stocks, especially AI companies, in the months to come.

1. Nvidia

Nvidia investors have seen major gains, with shares soaring 800% over the past two years. However, performance weakened at the start of the year due to market concerns and the idea that customers might reduce spending. Despite this, evidence from major tech companies like Meta Platforms and Alphabet shows that investing in AI remains a priority, which is excellent news for Nvidia.

Nvidia's latest quarterly earnings report highlights ongoing spending in AI, with revenue surging 69% to $44 billion. The company continues to see strong demand for its new Blackwell architecture and chip, particularly in the area of inference, which is crucial for AI problem-solving. Inferencing could drive significant growth in the next stages of the AI story, making Nvidia's strength in this area key.

Nvidia may face increased competition in the years ahead, but the company's leadership and commitment to annual innovation will keep it ahead of rivals. Nvidia has already outlined its roadmap for chip releases through 2028, demonstrating its commitment to reaching its innovation goals. Today, Nvidia trades at 33x forward earnings estimates, down from 50x earlier this year. This lower valuation presents a great buying opportunity, and any positive news in the second half could prompt the stock to surge.

2. SoundHound AI

SoundHound AI soared more than 800% last year amid market enthusiasm for AI stocks, driven by accelerating revenue growth. However, uncertainties that affected AI and growth stocks in general hurt SoundHound's performance, causing a 50% decline this year. Despite this, SoundHound's growth remains strong, and the company's long-term outlook is bright.

SoundHound specializes in voice AI, with a product that stands out due to years of research and development. The company's method translates speech directly to meaning, bypassing the common step of translating speech to text. This results in faster and higher-quality processing, and revenue growth shows that customers are recognizing this. For most of last year, SoundHound reported double-digit quarterly revenue growth, and in the most recent two quarters, revenue has advanced by triple digits. In the latest period, revenue surged 151% to a record of more than $29 million.

SoundHound has expanded its revenue base from the auto market to a broad range of industries, with no single customer representing more than 10% of revenue. The company is in the early stages of addressing a $140 billion market, and as more industries integrate AI to increase efficiency and cut costs, SoundHound could see significant revenue growth. This makes the current dip an ideal time to invest in this growth story, as the shares could take off at any moment.

In conclusion, both Nvidia and SoundHound AI are well-positioned to benefit from the growing demand for AI technology. Their innovative solutions and strong market presence make them compelling investments for the second half of 2025.