Jensen Huang had previously estimated that practical quantum computing would be 15 to 30 years away, but he recently revised this timeline to 5 to 15 years. This shift reflected the company’s growing interest in quantum, which is likely influenced by recent relevant milestones in the tech sector, particularly the MAG7. These advancements focus on error correction and reducing noise in quantum chips, which is crucial for scaling quantum computers effectively. Jack Hidary, SandboxAQ CEO, joined CNBC’s ‘Power Lunch’ on March 20 to discuss his takeaways from these advancements. Hidary emphasized that the future lies in integrating GPUs with quantum computing rather than choosing one over the other.
Jack Hidary’s perspective on AI focuses on its transformative impact and the shift from consumer-focused applications to business-driven innovations. The conversation on CNBC highlighted that while technologies like flying cars and supersonic air travel have long been discussed without becoming adopted or profitable, AI is rapidly advancing and is poised to deliver tangible results. Over the past two years, consumer AI tools like ChatGPT have dominated attention, which users to generate essays, emails, and summaries with simple prompts. However, Hidary emphasized that the next phase of AI development will center on B2B applications, which he believes will drive profound changes across industries. According to him, B2B AI has the potential to revolutionize sectors such as pharmaceuticals by enabling the development of new medicines and diagnostics. In energy, AI can help optimize hydrocarbon value chains and create higher-value products. In automotive manufacturing, AI is being used not only for autonomous driving but also for lightweight vehicles and improving product designs.
Hidary stressed that this shift toward B2B AI represents a significant economic impact, as it addresses 80% of GDP compared to the limited scope of consumer AI. He views this transition as a pivotal moment for AI’s integration into critical industries, which promises substantial advancements in technology and economic growth in the coming years. Through these developments, Hidary envisions AI becoming a cornerstone of innovation across multiple domains, reshaping how businesses operate and deliver value.
Our Methodology
We first sifted through relevant threads to compile a list of the top AI stocks. We then selected the 12 AI stocks that were the most popular among elite hedge funds and that analysts were bullish on. The stocks are ranked in ascending order of the number of hedge funds that have stakes in them, as of Q4 2024. The hedge fund data was sourced from Insider Monkey’s database which tracks the moves of over 900 elite money managers.
Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 373.4% since May 2014, beating its benchmark by 218 percentage points (see more details here).
12. POET Technologies Inc. (NASDAQ:POET)
Number of Hedge Fund Holders: 4
POET Technologies Inc. (NASDAQ:POET) is developing advanced optoelectronic solutions by integrating photonic and electronic devices using its POET Optical Interposer platform. By using AI-driven design and manufacturing, it aims to revolutionize data transfer and sensing across key markets. These include data centers, automotive LIDAR, and medical imaging.
The company targets the AI infrastructure market while focusing on the development and production of optical engines. Its POET Optical Interposer technology, which enables high-speed data communication within AI clusters, is the central driver of its growth strategy. This technology is vital for the advanced AI networks and hyperscale data centers that are demanding ever-increasing bandwidth.
The company is building partnerships to strengthen its position in the AI market. In Q4 2024, it secured a design win with Foxconn Interconnect Technology (FIT) for 800G and 1.6T optical engines. Luxshare Tech has integrated POET Technologies Inc.’s (NASDAQ:POET) optical engines into its product offerings. Collaborations with Mentech Technology and Mitsubishi Electric are underway to develop cutting-edge 800G and 3.2T optical solutions, both of which provide the high-speed data transfer that AI systems demand.
11. BigBear.ai Holdings Inc. (NYSE:BBAI)
Number of Hedge Fund Holders: 13
BigBear.ai Holdings Inc. (NYSE:BBAI) delivers AI-powered decision intelligence solutions across national security, supply chain management, and digital identity. Using data ingestion, machine learning, and predictive analytics, its AI-driven platforms provide critical insights and visualizations to defense, intelligence, and commercial sectors.
On March 7, Cantor Fitzgerald reduced the company’s price target from $8 to $6, while maintaining an Overweight rating. This sentiment came from the company’s underwhelming Q4 top-line growth, lower-than-expected guidance, and federal uncertainty. Still, the company was able to generate $43.8 million in Q4 2024, which was an 8% improvement year-over-year. BigBear.ai Holdings Inc. (NYSE:BBAI) projects 2025 revenue between $160 and $180 million due to continued growth in its AI-focused government solutions.
Cantor Fitzgerald had highlighted the bullish potential of the Pangiam acquisition to enhance vision AI, believing that the company is poised to become a leading AI/ML platform provider. BigBear.ai Holdings Inc.’s (NYSE:BBAI) vision AI capabilities enable advanced image and video analysis for diverse applications. The Pangiam acquisition enhances vision AI capabilities, particularly for applications in security and logistics.
10. Tempus AI Inc. (NASDAQ:TEM)
Number of Hedge Fund Holders: 17
Tempus AI Inc. (NASDAQ:TEM) is a healthcare technology company that uses AI to revolutionize patient care. It provides advanced genomic sequencing and data analysis. It also offers AI-driven platforms like Insights, Algos, and Lens, to help healthcare providers, pharmaceutical companies, and researchers utilize vast datasets for personalized medicine and clinical trial optimization.
The company’s Data and Services segment showed strength in Q4 2024 and boosted the company’s overall revenue growth to 35.8% year-over-year. The segment’s strength is centered on AI-powered data analysis and delivery and directly resulted in a record $940 million in total remaining contract value and a 140% net revenue retention. This success prompted the company to increase its 2025 revenue guidance to $1.24 billion. The five-year extension of its Google agreement further supports AI development.
TD Cowen’s Daniel Brennan reiterated a Buy rating on Tempus AI Inc. (NASDAQ:TEM) on February 24, while setting a $74 price target. This was driven by the company’s growth forecast, which includes higher-than-anticipated 2025 revenue, strong AI-powered Insights pricing, and a strategic shift towards higher-value genomic testing, all of which is supported by an expanded sales team.
Baron Discovery Fund profited from Tempus AI Inc.’s (NASDAQ:TEM) volatility and recognized its unique dataset and growth potential. Here’s what the fund stated in its Q3 2024 investor letter:
“Shares of Tempus AI, Inc (NASDAQ:TEM) contributed to performance. Tempus is a cancer diagnostics company that provides genomic testing results. Tempus has also amassed an over 200 petabyte proprietary multimodal dataset that combines clinical patient data with genomic testing data. In addition to using this data to empower more intelligent diagnostics for its own tests, Tempus also licenses this data to biopharmaceutical companies which use it to design smarter clinical trials and identify potential new drug targets. We think this proprietary dataset is unique with meaningful barriers to entry, and brings meaningful value to biopharmaceutical R&D. As we mentioned in the letter from last quarter, shares have been incredibly volatile. We took advantage of this volatility to buy a meaningful position when shares sold off into the low $20’s per share from an IPO price of $37. When shares spiked into the mid-$70’s (likely due to short sellers covering losses as shares rose), we took profits on a meaningful portion of the investment as we believed valuation had become stretched (shares now trade in the high $40’s to low $50’s level). We like our position sizing now, and would add to the position at lower valuations. We believe that Tempus has significant growth ahead of it and we are excited about its unique business model.”
9. Evolv Technologies Holdings Inc. (NASDAQ:EVLV)
Number of Hedge Fund Holders: 19
Evolv Technologies Holdings Inc. (NASDAQ:EVLV) provides AI-driven weapons detection for security screening. Its Evolv Express system uses advanced AI to detect concealed weapons without requiring physical contact, while Evolv Insights offers real-time data and analytics for optimized security operations.
The company reported strong Q4 2024 growth which was driven by its AI-powered Evolv Express weapons detection system. The company deployed ~470 new multi-year subscriptions, which surpassed 6,000 units globally and added 60 new customers across various industries. This included significant expansion in education, where it served over 1,200 school buildings, and healthcare, where it served over 450 hospital buildings. The company also booked initial orders for its new AI-based bag screening solution, Evolv eXpedite.
Given these updates, Craig-Hallum increased Evolv Technologies Holdings Inc.’s (NASDAQ:EVLV) price target to $6.75, while maintaining a Buy rating. With $52 million in cash and no debt, the company reaffirms its outlook for positive Adjusted EBITDA by Q2 2025. This highlights the growing market adoption of its AI-driven security technology.
8. SoundHound AI Inc. (NASDAQ:SOUN)
Number of Hedge Fund Holders: 21
SoundHound AI Inc. (NASDAQ:SOUN) develops advanced voice AI solutions for various industries. It offers the Houndify platform, SoundHound Chat AI, and Smart Answering, all powered by ML and natural language processing. Its technology enables businesses to create sophisticated conversational experiences across automotive, TV, IoT, and customer service applications.
A major development is the company’s voice commerce ecosystem, which links voice assistants with AI customer service for seamless voice transactions. This system, shown at CES 2025, has attracted interest from automakers and restaurant chains, with multiple proof-of-concepts (POCs) underway. The company is also developing Agentic AI, which is a collaborative network of autonomous agents coming together to achieve complex tasks and move beyond simple API interactions.
H.C. Wainwright analyst Scott Buck reiterated a Buy rating on SoundHound AI Inc. (NASDAQ:SOUN) with a $26.00 price target on March 3. This was due to the company’s strong Q4 2024 performance, which surpassed revenue forecasts and led to an increased 2025 revenue guidance. The total revenue hit a record $35 million in Q4, which was over a 100% year-over-year increase. The revised 2025 revenue forecast is between $157 to $177 million.
7. Recursion Pharmaceuticals Inc. (NASDAQ:RXRX)
Number of Hedge Fund Holders: 21
Recursion Pharmaceuticals Inc. (NASDAQ:RXRX) is a clinical-stage biotechnology company that uses AI to decode biology and chemistry for drug discovery. It uses advanced technologies across multiple scientific disciplines to develop treatments for various diseases. These include cerebral cavernous malformation, neurofibromatosis type 2, and familial adenomatous polyposis.
The company’s AI-driven drug discovery platform focuses on creating a world model of biology by integrating data from 6.2 million weekly brightfield images and 1.6 million total transcriptomes. This refers to building an AI model of biological systems by combining extensive image and genetic data to understand and predict biological processes. This platform, which is powered by the BioHive-2 supercomputer, aims to accelerate drug development.
The recent Exscientia merger improved the company’s AI and reduced drug candidate identification time by 60%. It also increased bioactive compound detection by 2.5x, and cut cytotoxic compound identification by 40%. Recursion Pharmaceuticals Inc. (NASDAQ:RXRX) is using AI to build a detailed digital model of a cell by combining various types of biological data, including patient data from Tempus and Helix. The $45 million in payments they received from Roche and Sanofi shows that these major companies recognize the value of Recursion’s AI technology.
6. C3.ai Inc. (NYSE:AI)
Number of Hedge Fund Holders: 25
C3.ai Inc. (NYSE:AI) is an enterprise AI software company. Its offerings include the C3 AI Platform, C3 AI CRM Suite, C3 Generative AI, and various industry-specific AI applications for sectors like energy, finance, and manufacturing. Its technology empowers organizations to use AI for optimized operations and data-driven decision-making.
The company’s GenAI and Agentic AI solutions address critical enterprise AI challenges like hallucination and data security. In FQ3 2025, the company’s total revenue reached $98.8 million, which was a 26% year-over-year increase. The subscription revenue was $85.7 million, which was up 22%. This was fueled by partnerships with Microsoft, AWS, and McKinsey, which have significantly expanded the company’s sales reach and shortened sales cycles.
The company has seen strong adoption of its C3 GenAI pilots across various sectors, which include defense, government, and consumer goods, with 20 new pilots in FQ3. C3.ai Inc. (NYSE:AI) is advancing Agentic AI, which focuses on improving autonomy and accuracy through innovations like a foundational time series embedding model. This model simplifies AI use cases involving time series data, which is crucial for many enterprise applications.
5. IONQ Inc. (NYSE:IONQ)
Number of Hedge Fund Holders: 28
IONQ Inc. (NYSE:IONQ) develops and provides access to quantum computers and networks. By using advanced trapped-ion technology, it aims to unlock the potential of quantum computing in order to revolutionize industries such as healthcare, materials science, and AI.
The company’s primary AI focus is quantum computing and networking. The company expanded its networking capabilities by acquiring Qubitekk and securing a controlling stake in ID Quantique, which helped it gain nearly 900 patents. This strengthened the company’s position in secure quantum communication for telecom and defense. Overall 2024 revenue was $43.1 million, which was a 95% year-over-year increase. The company projects 2025 revenue between $75 and $95 million.
In computing, IONQ Inc. (NYSE:IONQ) delivered its first Forte enterprise system and is developing the Tempo system. Forte Enterprise system is the company’s current advanced quantum computer for commercial use, while Tempo is its next-generation system that aims for even greater performance and wider application. Collaborations with AstraZeneca and General Dynamics Information Technology are advancing AI-driven applications like drug discovery and fraud detection.
4. SoFi Technologies Inc. (NASDAQ:SOFI)
Number of Hedge Fund Holders: 43
SoFi Technologies Inc. (NASDAQ:SOFI) is a financial services company with a focus on AI-driven solutions. Its platform includes lending, banking, and investing, and utilizes AI for personalized financial management through features like robo-advisory and AI-powered financial tracking. It also provides AI-enhanced technology platforms to other financial institutions for intelligent financial experiences.
The company’s AI-driven financial platform focuses on personalized experiences. In 2024, the company reached over 10 million members, which was up 34% year-over-year. It added 1.1 million products in Q4, with 89% from Financial Services. This platform uses AI to recommend products and streamline transactions. The AI-enhanced Financial Services segment saw Q4 revenue of $257 million, which was up 84%. The Financial Services Productivity Loop uses AI to increase cross-selling, with 30% of new products from existing members.
AI also powers the company’s lending platform (LPB), which originated $2.1 billion in 2024. AI-driven underwriting aids partnerships and generates fee income. SoFi Technologies Inc. (NASDAQ:SOFI) launched an AI-powered RoboAdvisor which is a financial planning service that provides investment advice and portfolio management with the aid of AI.
The company’s strong Q4 performance, which was driven by customer growth, new revenue streams, and favorable market conditions, positions it for continued growth and margin expansion. Patient Capital Management stated the following regarding SoFi Technologies Inc. (NASDAQ:SOFI) in its Q4 2024 investor letter:
“The top performers in the fourth quarter were once again Financials and Travel names. We’ve been over-indexed to them since the pandemic, which has served us well. We strategically added to certain financial names like SoFi Technologies, Inc. (NASDAQ:SOFI) and Coinbase Global Inc. (COIN) during the year. Both companies rebounded strongly in the fourth quarter.
Sofi Technologies Inc. (SOFI) was a standout in the quarter, climbing 95% and up 156% from the intra-day lows in June. The company benefited from Fed rate cuts and the market’s growing optimism that the economy will avoid a recession. The company continues to grow its customer count while successfully cross selling into their loans and financial service products. In the quarter, we saw the company take on a new revenue stream by originating loans for third parties, creating an attractive balance sheet-light revenue source, helping improve return on equity and margins. Sofi is early in its life cycle, currently being a small player in a very large total addressable market (TAM). With their strong management team, we believe the company will continue to deliver on their guidance of strong growth and expanding margins.”
3. Snap Inc. (NYSE:SNAP)
Number of Hedge Fund Holders: 44
Snap Inc. (NYSE:SNAP) is a technology company that uses AI to enhance visual communication and advertising. Its platform uses AI for features like AR ads, personalized content delivery, and the development of innovative camera and messaging experiences. With a focus on visual storytelling and user engagement, it’s pushing the boundaries of AI-driven social media.
The company’s AI focus is on its advertising platform and AR experiences. AI-powered ad optimization is the key to this strategic growth, with app-based purchase revenue up over 70% year-over-year and a 6x increase in leads generated. The company is also testing Smart Budget Optimization for automated campaigns. AI enhances AR through Lens Studio, with AI-powered lenses. Instances of these include the me-in-the-60s lens with 900 million views and the Easy Lens with 300 million lens engagements.
Snap Inc. (NYSE:SNAP) is working on AI that can create sharp images directly on smartphones. It has also introduced new AI-powered ad formats, Sponsored Snaps and Promoted Places, which are performing well. For example, Sponsored Snaps have been seen over 50 million times in the US. In Q4 2024, the company’s revenue was $1.56 billion, which was up 14% year-over-year. This was driven by direct response (DR) ad revenue, which was up 14%.
2. Palantir Technologies Inc. (NASDAQ:PLTR)
Number of Hedge Fund Holders: 64
Palantir Technologies Inc. (NASDAQ:PLTR) specializes in AI-powered software platforms for data analysis and operational decision-making. Its solutions, which include Palantir Gotham, Foundry, and the AI Platform, utilize advanced AI and ML to uncover hidden patterns in complex datasets and enable real-time responses.
The company’s AI Platform (AIP) facilitates deploying LLMs into enterprise workflows. The company’s Q4 2024 revenue hit $828 million, which was up 36% year-over-year. The full-year revenue reached $2.87 billion, which was a 29% improvement. AIP adoption is surging, especially in the US commercial sector. Q4 US commercial revenue grew 64% year-over-year to $214 million. The company’s enterprise autonomy focus automates complex processes, like reducing bank back-office tasks from five days to three minutes.
On March 18, Jefferies analysts reiterated their Underperform rating for the company with a price target of $60. Despite being impressed by the ROI case studies presented at the company’s AI Platform customer event, which showcased the transformative impact of its products, Jefferies maintains its Underperform stance.
Palantir Technologies Inc.’s (NASDAQ:PLTR) strong Q3 results, increased revenue guidance which was driven by its AI platform, and potential government partnerships contributed positively to Alger Mid Cap Focus Fund’s performance. It stated the following (NASDAQ:PLTR) in its Q4 2024 investor letter:
“Palantir Technologies Inc. (NASDAQ:PLTR) builds advanced platforms for data integration, management, and security, enabling interactive, AI-assisted analysis for its users. Its core offerings include Palantir Gotham, designed for government clients, and Palantir Foundry, tailored for commercial customers. Originally focused on U.S. intelligence agencies, Palantir has expanded into defense contracts with western governments and entered the commercial market in 2016. During the quarter, shares contributed to performance after the company reported better-than-expected fiscal third quarter operating results, along with management raising its full year 2024 revenue guidance. Management noted that the recent launch of its AI platform (AIP), which leverages generative AI to optimize business operations, has driven significant growth and investor interest. Additionally, we believe Palantir could be a key partner for the U.S. government’s new Department of Government Efficiency (DOGE), as its AI-driven platforms are ideally suited to help identify inefficiencies, allocate resources effectively, and achieve cost reductions.”
1. Nebius Group (NASDAQ:NBIS)
Number of Hedge Fund Holders: 66
Nebius Group (NASDAQ:NBIS) specializes in building infrastructure for the global AI industry. It provides AI-centric cloud platforms, large-scale GPU clusters, and developer tools. Additionally, it operates Toloka AI for data services, TripleTen for tech education, and Avride for autonomous driving, which creates a full ecosystem to support AI development and applications.
On February 24, DA Davidson initiated coverage of the company with a Buy rating and a $50 price target. The firm included this company in their DaVinci initiative, which focuses on deep tech companies. It views Nebius Group (NASDAQ:NBIS) as a promising early competitor in the AI compute market, which is currently dominated by hyperscalers.
Nebius Group (NASDAQ:NBIS) focuses on building a major AI infrastructure company. In Q4, the company launched its AI cloud platform and AI Studio (Inference-as-a-Service). It’s expanding GPU clusters in Europe and the US, and planning a new US data center. The company is investing in its data center infrastructure to support the anticipated performance demands of next-generation Blackwell GPUs for its AI cloud services. The company’s AI data service, Toloka, grew revenue by 140% in 2024, adding major AI labs as clients as well.
As we acknowledge the growth potential of Nebius Group (NASDAQ:NBIS), our conviction lies in the belief that AI stocks hold great promise for delivering high returns and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than NBIS but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
READ NEXT: 20 Best AI Stocks To Buy Now and 30 Best Stocks to Buy Now According to Billionaires.
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