Are these two companies positioned for significant AI victories in the next five years?
While some leading companies in the artificial intelligence (AI) sector have made remarkable progress, it seems the AI revolution is just beginning. Savvy investors who support the right players in this space stand to gain considerable returns from firms with favorable risk-reward profiles.
This article highlights two prominent AI companies identified by some Motley Fool contributors as potential frontrunners to become the world’s two most valuable companies in five years.
Nvidia is Expected to Maintain Its Lead
Jennifer Saibil (Nvidia): AI represents the most significant trend in today’s business landscape, transcending mere buzz and actively transforming activities from reading and shopping to studying and playing. As industry leaders invest in enhancing their technologies, the capabilities of AI continue to grow. Nvidia (NVDA 0.34%) sits at the forefront of these trends, currently valued as the highest company globally. It is likely to remain at the top as clients increasingly rely on its superior products to strengthen their own AI initiatives.
Though facing competition from new AI chip manufacturers, Nvidia consistently improves its offerings to maintain its lead. With approximately 95% market share in AI chips, it supplies major players like Amazon, Microsoft, and Meta Platforms, all of which have boosted their AI investments, including Nvidia’s premium graphics processing units (GPUs). Together, these companies are expected to spend nearly $300 billion annually, a figure that may rise further.
Nvidia has experienced remarkable growth, particularly impressive for such a large company. In the fiscal second quarter of 2026 (ending July 27), its revenue grew by 56% year-over-year, despite a sales issue related to China. Management anticipates third-quarter sales of $54 billion, marking a 54% increase from the previous year. With robust profitability metrics—72.4% gross margin and 56.5% profit margin—Nvidia is also exploring new domains, launching products like the Rubin CPX, which aims to set new standards for AI processing speed and efficiency.
The Potential of Amazon Should Not Be Overlooked
Keith Noonan (Amazon): Although Amazon (AMZN 0.23%) operates the leading cloud infrastructure service, its stock has shown relatively weak performance amid the AI surge. Over the past five years, its stock has only risen by 50%, falling short of the S&P 500’s 95% increase.
In comparison to Microsoft’s 148% surge and Nvidia’s staggering 1,260% leap, Amazon’s performance appears even less impressive. This underachievement can be attributed to growing competition in cloud computing, tariff pressures, and broader economic factors. However, strong indicators suggest Amazon could emerge among the top two most valuable companies globally within five years.
Despite rising competition, Amazon Web Services (AWS) continues to demonstrate solid growth and positive margins, positioning it well to benefit from the influx of new AI applications. Although AWS’ growth has faced certain headwinds, particularly related to its e-commerce sector, Amazon’s online retail business could soon experience a turnaround.
The intersection of AI and robotics is likely to enhance efficiency within Amazon’s retail operations. By adopting advanced automation, the company stands to significantly boost margins in its vast e-commerce division, thereby reshaping its overall profitability landscape.
Jennifer Saibil does not hold any positions in the stocks mentioned. Keith Noonan also does not have positions in these stocks. The Motley Fool holds positions in and recommends Amazon, Meta Platforms, Microsoft, and Nvidia. The Motley Fool endorses options including long January 2026 $395 calls on Microsoft and short January 2026 $405 calls on Microsoft. For more details, see the Motley Fool’s disclosure policy.
