Tech companies have been on a tear in recent years, particularly due to the rise of AI. However, other segments within the tech sector might warrant your attention, like cloud computing, particularly edge computing. Edge computing differs from cloud computing in that it brings computing power to where the data is created. Since data does not have to travel a lot, it can be processed much quicker compared to centralized computing, like Amazon Web Services (AWS). The amount of data being created is growing at an exponential rate as more devices are being connected to the internet. Edge computing makes things easier as data is processed close to where it is made.
The Edge Computing Area is Likely to Get a Push
The edge computing market is expected to get a big push from the rise of artificial intelligence (AI), with total spending projected to reach $380 billion by 2028, according to a new IDC report. Businesses are expected to gradually move away from traditional on-site hardware and instead put more money into cloud-based infrastructure-as-a-service (IaaS) solutions that support AI workloads at the edge. IDC estimates that global spending on edge computing will hit $261 billion in 2025, and that number is expected to grow by nearly 14% each year. The main driver behind this surge is the increasing demand for powerful systems that can handle AI tasks.
According to Alexandra Rotaru of IDC, the Internet of Things (IoT) still leads as the top use case for edge computing, but AI, augmented reality (AR), virtual reality (VR), robotics, and drones are quickly catching up. “IoT is still the biggest, but AI and AR are growing fast. In about a year, AI may become the fastest-growing area,” Rotaru said. Right now, most of the spending is going into on-premises setups—things like servers and storage systems—to meet current needs. Rotaru noted that even though it’s already a large market, there’s still room for growth because this infrastructure is so important.
IDC’s report looked at many industries and found that the biggest edge spending will come from retail, manufacturing, transportation, utilities, and finance. These sectors continue to invest in technology despite economic uncertainties. Rotaru added that recent surveys show businesses are more optimistic about IT spending in 2025 than they were for 2024. This confidence matches findings from a PwC Global AI Study, which reported that most business leaders see AI as a major advantage and are either using it or planning to adopt it soon.
While companies are currently focused on buying hardware, IDC expects many to shift toward cloud and service-provider-based IaaS as time goes on. This opens the door for cloud companies to capitalize on their existing infrastructure. Rotaru said this shift is happening because cloud providers are becoming more capable of handling AI workloads at scale.
A team of software engineers at desks working on code for a cutting-edge cloud computing solution.
Our Methodology
We reviewed edge computing ETFs to compile a preliminary list of stocks and then selected the ones that were the most popular among elite hedge funds, as of Q4 2024.
At Insider Monkey we are obsessed with 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).
13 Best Edge Computing Stocks to Buy According to Hedge Funds
13. Fastly, Inc. (NYSE:FSLY)
Number of Hedge Fund holders: 27
Today, businesses depend a lot on giving people smooth and fast online experiences. Fastly, Inc. (NYSE:FSLY) helps them do this with its edge cloud platform, which sends digital content quickly and safely to users. This helps websites and apps load faster and work better. The company does more than regular content delivery networks (CDNs). It also includes security tools, real-time data handling and lets developers run code right near the user, instead of far away in a central server. This is great for things like shopping, streaming, or live videos where fast response times are important.
While Fastly, Inc. (NYSE:FSLY) is a long-term prospect, according to analysts, the stock is facing short-term headwinds. The company closed out 2024, reporting a record fourth-quarter 2024 revenue of $140.6 million. This exceeded its guidance range of $136 million to $140 million. However, it represented a paltry 2% growth, both year over year and quarter over quarter. That said, the company saw better-than-expected seasonal traffic, along with market-share gains at the year-end. For the fiscal year 2024, the company generated revenue of $544 million, representing 7% year-over-year growth. On March 20, Oppenheimer resumed its ‘Perform’ rating on the stock, highlighting operational hurdles that could limit its near-term performance.
12. Ambarella, Inc. (NASDAQ:AMBA)
Number of Hedge Fund holders: 32
Ambarella, Inc. (NASDAQ:AMBA) makes software and low-power AI-chips for edge devices like sensors. Its technology enables real-time functions such as object recognition and video analysis while conserving power and bandwidth. The company’s technology is applied in automotive cameras, security systems, drones, robots, industrial machines, and consumer cameras. Their radar software enhances the accuracy and efficiency of existing radar chips, improving performance in mobility solutions. By processing data on devices (vs. cloud), Ambarella’s edge AI reduces delays, boosts efficiency, and enhances privacy.
On March 31, Ambarella, Inc. (NASDAQ:AMBA) announced significant developments in edge generative AI technology. The company shipped 30 million cumulative edge AI systems on chip. These developments highlight its leading position as a supplier of edge AI systems on chip. It also underscores the company’s ability to enable scalable high performance and a vision of AI applications across edge inference CVflow. Its latest 3.0 AI SoC portfolios should be able to support GenAI models from 0.5 to 34 billion parameters.
11. Akamai Technologies, Inc. (NASDAQ:AKAM)
Number of Hedge Fund holders: 37
Akamai Technologies, Inc. (NASDAQ:AKAM) is one of the world’s largest Content Delivery Networks (CDN). It operates over 4,300 edge locations in 130 countries and in over 700 cities. This allows it to process data and run applications close to users. It serves the SaaS industry by providing solutions for security, analytics, and the delivery of media and content. The company manages a significant share of the internet’s daily data flow. Its security tools also run at the edge, preventing cyberattacks before they reach the customer’s core infrastructure.
Akamai Technologies, Inc. (NASDAQ:AKAM) recently said that Devsisters Inc. has opted to deploy its cloud computing platform, Akamai Cloud, to bolster its global game services infrastructure. Through this deployment, Devsisters, a Korean game developer, expects a smoother deployment and scaling process for new game releases, large-scale updates, and in-game events, ensuring high-quality experiences for its growing global audience.
On March 27, the company unveiled Akamai Cloud Inference, hoping to get into the artificial intelligence deployment landscape. This is designed to make it easier for businesses to turn predictive and large language models into real-world actions. Akamai Cloud Inference offers 3 times better throughput, along with 60% less latency and 86% cost savings.
10. Check Point Software Technologies Inc. (NASDAQ:CHKP)
Number of Hedge Fund holders: 40
Check Point Software Technologies Inc. (NASDAQ:CHKP) is primarily a cybersecurity company. However, it plays a major role in the edge computing ecosystem through its network security solutions that operate at the edge. It plays a crucial role in securing edge environments. The company provides cloud-native security for edge workloads running in cloud. Check Point’s Secure Access Service Edge and SD-WAN are cornerstone technologies in edge computing environments.
Check Point Software Technologies Inc. (NASDAQ:CHKP) is now a leader in ASM after its recent acquisition of Cyberint. In a recent report, Gartner highlighted the need for a strong Attack System Management (ASM) solution. According to Gartner, by 2026, organizations that prioritize their security investments based on a continuous exposure management program will be 3X less likely to suffer a breach. Cyber threats are evolving at an exponential pace. The company’s approach helps companies stay ahead of adversaries and reduce risk exposure.
9. Cloudfare, Inc. (NASDAQ:NET)
Number of Hedge Fund holders: 55
Cloudfare, Inc. (NASDAQ:NET) is one of the biggest pure-play edge computing companies. The company’s flagship, Cloudfare Workers, is an edge compute offering where developers write code that run on the edge. The company combines edge computing with network security, which is its key strength. It also improves speed and performance at the edge via smart traffic routing, global content caching, load balancing and real-time optimization. Cloudfare, Inc. (NASDAQ:NET) has data centers in over 310 cities around the world.
On April 7, Oppenheimer maintained Cloudfare’s outperform rating and kept its price target unchanged at $150. Citing its industry checks, the firm said it believes Cloudflare contracts are “highly unlikely” to get cut from the budget as they fall under mission-critical systems. The company can achieve its 2025 target despite economic concerns relating to the impact of tariffs, federal budget cuts, and a potential recession risk, Oppenheimer said. The firm thinks that Cloudfare will be able to “reaccelerate” its growth after navigating the current economic landscape.
8. Dell Technologies Inc. (NASDAQ:DELL)
Number of Hedge Fund holders: 63
For most of its life, Dell Technologies Inc. (NASDAQ:DELL) has been a hardware company that manufactures computers. However, the company pivoted into the software space several years ago. Dell builds purpose-built hardware to operate in edge environments where there is a dearth of space, power, and network connectivity. It also combines hardware and software for automating and managing edge deployments. The company is also big on analytics and edge AI, which helps businesses analyze data locally and in real time.
Dell recently unveiled a suite of innovations aimed at modernizing data centers for AI applications. These advancements are likely to enhance stability, efficiency, and adaptability of workloads. Given the growing demands of AI workloads, the company is focusing on disaggregating infrastructure that will separate compute, storage, and networking resources. While analysts see a huge upside for this stock, it is not without any headwinds. Analysts warn that the recent tariffs announced by President Trump make some tech stocks like Dell more vulnerable.
7. Hewlett Packard Enterprise Company (NASDAQ:HPE)
Number of Hedge Fund holders: 66
Hewlett Packard Enterprise Company (NASDAQ:HPE) is a global tech company that helps businesses collect, understand, and use data from the edge to the cloud. It helps customers grow by improving how they work, serve their clients, and run operations. HPE offers an edge-to-cloud platform, mainly through HPE GreenLake, which delivers cloud services on demand. This helps customers modernize their IT and gain more value from their data—whether it’s in the cloud, in a data center, or at the edge. The company also provides high-performance servers, networking tools, and financial services to help businesses access the tech they need.
On April 8, Hewlett Packard Enterprise Company (NASDAQ:HPE) unveiled a new virtual private cloud along with on-premises deployment options for its Aruba Networking Central, to provide clients with flexible and secure networking solutions. HPE is also poised to take over Juniper Networks, which is likely to accelerate its edge-to-cloud vision. The company recently reported its Q1 2025 results. The company’s revenue for the quarter grew a solid 16.1% year-over-year to $7.81 billion. Net income grew 67% year-over-year to $627 million.
6. Arista Network Inc. (NASDAQ:ANET)
Number of Hedge Fund holders: 78
Arista Network Inc. (NASDAQ:ANET) provides high-performance networking infrastructure that enables data processing and managing at the edge of networks. The company designs super-fast, programmable switches and routers that are key for handling real-time data. These switches and routers are necessary in edge environments like data centers, IoT applications, among others. The company’s platforms support Artificial Intelligence and Machine Learning (ML) workloads at the edge.
Arista Network Inc. (NASDAQ:ANET) reported record revenue for the year ending December 2024. The company’s revenue for the year stood at $7 billion, growing at a robust 19.45% from the previous year. The company’s net margin continued to expand strongly. Its net income for the year stood at $2.85 billion, a 36.3% increase from the prior year. The company’s revenue growth even accelerated in the last quarter, growing by 25.3% year-over-year to $1.93 billion. Last month, the company introduced the EOS Smart AI Suite featuring Cluster Load Balancing to improve AI workload performance.
5. Accenture plc (NASDAQ:ACN)
Number of Hedge Fund holders: 79
Accenture plc (NYSE:ACN) is a global professional services firm, that offers consulting, digital transformation technology services, and outsourcing. However, edge computing is a part of the company’s offerings as it helps its clients to modernize their tech infrastructure. The tech behemoth helps businesses define where and how edge computing fits into their digital strategy. Accenture designs and implements edge solutions. The company also specializes in deploying AI models and IoT systems at the edge.
Accenture plc (NYSE:ACN) adjusted the lower end of its revenue forecast for 2025. It is now expecting a growth of 5% to 7%, up from the previous 4% to 7%. The company is optimistic about the demand for its AI Integration services. The stock rose 3% upon this adjustment. However, the company is expecting a slowdown in its federal services unit due to a massive cut in US government spending. Meanwhile, Accenture is penning a joint venture with Fincantieri Group unit Fincantieri NexTech to “accelerate digital transformation” in the cruise, defense, and port infrastructure sectors. The Fincantieri Ingenium joint venture will initially develop the Navis Sapiens system for new ships and upgrade existing fleets.
4. Palo Alto Networks, Inc. (NASDAQ:PANW)
Number of Hedge Fund holders: 83
Palo Alto Networks, Inc. (NASDAQ:PANW) has a comprehensive set of security solutions custom-made for edge environments. As edge computing decentralizes data processing closer to users and devices, robust security measures become crucial. Palo Alto Networks, Inc. (NASDAQ:PANW) addresses these needs through several key offerings. The company’s SASE framework integrates networking and security functions into a unified, cloud-delivered service, enhancing secure access to applications and data across several environments, including edge locations.
The company recently said that it has surpassed $1.5 billion in total sales via Alphabet’s (GOOG) Google Cloud Marketplace as of April. Google Cloud Marketplace allows clients to buy applications that have been validated to run on Google Cloud, Palo Alto said, adding that it offers 31 Google Cloud Marketplace listings. On April 1, Stephens & co. initiated coverage of the company with an equal-weight rating, with a price target of $205. The firm acknowledged the company’s strong leadership in network security. However, Stephens would like to look for a more attractive entry point for the stock. It views the current risk/reward as neutral.
3. Intel Corporation (NASDAQ:INTC)
Number of Hedge Fund holders: 83
Intel Corporation (NASDAQ:INTC) plays a crucial role in building the hardware and software infrastructure that enables edge computing. The semiconductor company designs and manufactures CPUs, GPUs and AI chips that power edge devices. Intel has frameworks like OpenVINO, which helps developers run AI models efficiently on edge devices. The company also backs edge computing with open-source tools and SDKs. It powers edge computing across industries like healthcare, manufacturing, retail and energy.
Intel Corporation (NASDAQ:INTC) is making progress on the foundry space. The Intel 18A manufacturing process is fully developed and now in limited production. The challenge for the company will be to scale up production and score enough new clients to push the foundry toward profitability. Additionally, Intel and TSMC have reached a preliminary agreement to form a joint venture. TSMC would acquire a 20% stake in Intel’s chip-manufacturing division. This venture aims to enhance Intel’s manufacturing capabilities while aligning with U.S. objectives to bolster domestic semiconductor production.
2. Cisco Systems Inc. (NASDAQ:CSCO)
Number of Hedge Fund holders: 84
Cisco Systems Inc (NASDAQ:CSCO) plays a huge role in enabling the infrastructure, networking, and security that make edge computing possible. The networking giant produces switches, routers, and wireless access points that are deployed locally. It also makes IoT and edge compute gateways that run analytics and AI workloads on the edge. Cisco partners with Microsoft Azure and Amazon Web Services for hybrid edge- cloud solutions. The company also provides Zero Trust security models, which are especially useful when devices are outside a secure, centralized network.
In light of the growing demand for networking equipment, particularly due to the expansion of AI infrastructure, Cisco Systems Inc (NASDAQ:CSCO) has raised its annual revenue forecast. The company now anticipates current year revenue between $56 billion and $56.5 billion, which is slightly above analysts’ estimates. On March 14, Evercore analyst Amit Daryanani maintained a “Buy” rating on the stock and set a price target of $75. The rating follows news of a partnership between Cisco and Nvidia and the unveiling of a new AI factory architecture that will enable clients to build and secure data centers to develop and run AI workloads.
1. NVIDIA Corporation (NASDAQ:NVDA)
Number of Hedge Fund holders: 223
NVIDIA Corporation (NASDAQ:NVDA) aids edge computing through its powerful GPUs and software platforms, which enable AI, graphics, and compute-intensive tasks that run locally. The semiconductor behemoth’s Jetson platform is built particularly for edge computing, which often involves real-time AI. The company doesn’t only make hardware. It has software ecosystems for building and deploying edge AI. Its Isaac, DeepStream, and Metropolis platforms help clients rapidly deploy AI models at the edge, not only in the data center.
NVIDIA Corporation (NASDAQ:NVDA) is poised for continued growth, driven by its leadership in AI infrastructure, data center solutions, and gaming technology. According to the company, its technology has long-term usability. The company’s revenue has more than doubled in each of the last two fiscal years. Its bargaining power is evident in its operating margin which has expanded to a stellar 62.4% in 2024. Analysts expect the company to continue to grow at a blistering pace. The company’s revenue is expected to grow at 23.7% annually over the next 4 financial years. At GTC 2025, the company announced collaborations with Cisco and T-Mobile to develop AI-native 6G wireless technology, marking its expansion into edge AI markets. These partnerships aim to integrate its AI capabilities with next-generation wireless technologies.
While we acknowledge the growth potential of NVDA, our conviction lies in the belief that AI stocks hold great promise for delivering high returns and doing so within a shorter time frame. There is an AI stock that went up since the beginning of 2025, while popular AI stocks lost around 25%. If you are looking for an AI stock that is more promising than NVDA but that trades at less than 5 times its earnings, check out our report about this cheapest AI stock.
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