For many years, apple Became the top dog. But, as the saying goes, times are changing.
iPhones are old news. Device sales are flat after years of growth. Additionally, the company is currently embroiled in an antitrust lawsuit with the U.S. Department of Justice that could last several years and cost millions or even billions in legal fees and fines.
It may finally be time for investors to look elsewhere for outperformance. Let’s take a look at two artificial intelligence (AI) stocks that could be alternatives to Apple’s portfolio.
Image source: Getty Images.
1.Microsoft
First, microsoft (MSFT -0.17%). The decades-long battle between Microsoft and Apple has seen Microsoft gain the upper hand in recent months, once again surpassing its rival in market capitalization.
Part of that is due to Microsoft’s competitive advantage in the AI space. The company has several AI initiatives that are already bearing fruit.
Microsoft is jumping on the AI chatbot bandwagon with its Copilot assistant. With the ability to generate images, compose emails, write code, and shop, Microsoft hopes Copilot can become many people’s “everyday AI companion.”
A close partnership with ChatGPT maker OpenAI has put Microsoft at the forefront of AI innovation. After ChatGPT took the world by storm a year ago, Microsoft quickly jumped on the bandwagon by integrating some of ChatGPT’s features into its Office software suite.
Finally, thanks to Microsoft’s large cloud services business, the company can expect to benefit from growth in the overall AI market. When AI startups look to scale their models, they’ll look to Microsoft. As the second largest cloud service provider, Microsoft controls many of the high-performance computers needed to run the latest and greatest AI models.
As the AI revolution continues, Microsoft has several ways to win. So it may be time for investors to invest in Microsoft and leave Apple behind.
2. Super microcomputer
Yes it’s true: super microcomputer‘s (SMCI -1.30%) The stock is up more than 800% in one year.
But its impressive outperformance shouldn’t scare long-term investors. Here’s why: Super Micro Computer’s overall business model is simple. The company makes the physical hardware that holds and cools the highly complex and expensive graphics processing units (GPUs) that power the most complex AI models.
In other words, supermicrocomputers are spinning like an ice cream shop in the middle of a heat wave.
Granted, the boom won’t last forever. But it can last much longer than many people think. That’s because the overall GPU market is expected to grow 10 times from 2022 to 2032. Furthermore, these estimates may actually be too conservative. Some industry observers believe the market could grow from $40 billion to $400 billion by 2027 rather than 2032.
Either way, the demand for high-performance GPUs is increasing like an avalanche, and as a result, so is the demand for the server racks that house them.
As a result, analysts expect total supermicrocomputer sales to jump from $7.1 billion to $14.6 billion this year. Wall Street expects sales to exceed $20.7 billion by 2025.
For long-term investors looking for a growth stock with serious legs, Super Microcomputer is a stock to consider.
Jake Larch has no position in any stocks mentioned. The Motley Fool has positions in and recommends Apple and Microsoft. The Motley Fool recommends the following options: His January 2026 $395 long call on Microsoft and his January 2026 $405 short call on Microsoft. The Motley Fool has a disclosure policy.
