On 17th February, xAI launched its updated Grok 3 AI model as part of efforts to stay at par with the evolving reasoning and search capabilities showcased by global competitor models. During an event live-streamed on X, xAI leaders claimed that the latest version of Grok 3 is better than Gemini, GPT-4o, Claude 3.5, and DeepSeek’s V3 models in terms of math, science, and coding benchmarks.
xAI also highlighted the tool’s latest features, which include advanced web searching with “deep search,” coding abilities for online games, and a “big brain” mode for complex problems. The xAI announcement comes as the global AI race heats up amid China’s advancements in this space.
While the cost-effective DeepSeek AI and the Qwen 2.5 models triggered a $1.3 trillion market rally in China, the mainland could witness further economic boost after recently announcing breakthroughs in quantum computing, focusing on quantum communications. However, analysts warn of data-driven surveillance and global data-centric authoritarianism in tandem with quantum advances.
“First, quantum computing is expected to eventually enable any state or non-state actor that possesses this technology to circumvent encryption that protects communications,” the analysts state. “Second, if the quantum communications providers who are first-movers in this space adopt cryptography standards and equipment that include backdoors for official government use, information conveyed over quantum networks will be vulnerable to state surveillance — potentially either by the governments that import these technologies, or by the home countries of companies that provide quantum services.”
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8. Safe Pro Group Inc. (NASDAQ:SPAI)
Number of Hedge Fund Holders: N/A
Safe Pro Group Inc. (NASDAQ:SPAI) provides AI services and solutions powered by proprietary ML and computer vision technology, supported by Amazon Web Services for drone imagery processing to rapidly and accurately identify explosives threats.
On February 19th, Safe Pro Group Inc. (NASDAQ:SPAI) announced that its Safe Pro AI subsidiary completed processing over 1,000,000 real-world images and 20,000 explosive threat detections in Ukraine with the help of its patented AI-powered small object threat identification and drone image analysis and mapping capabilities.
“The one million image milestone is the result of hundreds of days and thousands of miles logged by our dedicated team while building meaningful relationships with stakeholders in Ukraine. The use of our AI to process drone-based imagery and detect landmines and UXO is possible thanks to the dedication and commitment of our Safe Pro AI team and the invaluable support provided by our partner, AWS, who has enabled us to continue to harness the power of the Cloud to scale our AI to meet the massive challenge of demining Ukraine. Through continued development of our algorithms, we look forward to applying our IP to support evolving customer requirements for specialized small object threat detection technology at home and abroad.”
-said Dan Erdberg, CEO of Safe Pro Group Inc.
7. Altair Engineering Inc. (NASDAQ:ALTR)
Number of Hedge Fund Holders: 13
Altair Engineering Inc. (NASDAQ:ALTR) is a computational intelligence leader offering software and cloud products for simulation, HPC, data analytics, and AI to help organizations resolve complex engineering challenges through design optimization and data-driven decisions.
On February 19th, Altair Engineering Inc. (NASDAQ:ALTR) announced the launch of Altair HyperWorks 2025, a next-gen simulation platform that uses AI, HPC, and multiphysics simulation to optimize design in a virtual, zero-prototype world, fostering smarter and sustainable development solutions. The company also highlighted how its physics prediction models powered by new architectures, ML, and AI deliver precise simulation of non-linear systems faster, even with limited data for detailed insights early in the design process.
“Altair HyperWorks 2025 builds on four decades of Altair’s expertise in simulation, design, and optimization. By integrating advanced simulation technologies with AI and machine learning, automation, open architecture, and a connected digital thread, the platform accelerates design processes, fosters scalable cloud collaboration, and empowers teams to deliver smarter, faster, and more sustainable solutions. It is yet another leap in our vision of democratized computational intelligence.”
-said James R. Scapa, founder and CEO of Altair Engineering Inc.
6. Fiverr International Ltd. (NYSE:FVRR)
Number of Hedge Fund Holders: 15
Fiverr International Ltd. (NYSE:FVRR) connects freelancers with businesses through its online marketplace. Its newly launched Fiverr Go GenAI platform leverages the company’s vast first-party transaction data to enable freelancers to fully control their creative rights and develop their creation models for better pricing power over their AI counterparts.
On February 19th, Fiverr International Ltd. (NYSE:FVRR) posted a 13% year-over-year jump in Q4 revenue to $103.7 million from $91.5 million, driven by the Services segment and initiatives like Fiverr Pro, AI-based Fiverr Go platform, and Dynamic Matching. The company’s non-GAAP Q4 net income increased YoY to $24.9 million or $0.64 diluted earnings per share. Fiverr International Ltd. (NYSE:FVRR) said its Q1 2025 guidance is between $103.5 million and $108.5 million due to strong momentum in revenue from the Services segments and progress in AI initiatives.
“We delivered strong results for 2024, finishing the year well ahead of our initial targets, with double-digit revenue growth and robust margins. We continue to focus on our upmarket initiatives while strategically expanding Services revenue to drive further growth. It has been a year of significant innovation and investment in AI. Our latest launch, the revolutionary and unique human-centered AI platform Fiverr Go, allows our talent community to build their own creation models, control their creative rights, and take their business to the next level. We started off 2025 with significant momentum in our product pipeline, growth trajectory and investments, giving us confidence in the long-term opportunity ahead.”
-said Micha Kaufman, Founder and CEO of Fiverr International Ltd.
5. Perion Network Ltd. (NASDAQ:PERI)
Number of Hedge Fund Holders: 21
Perion Network Ltd. (NASDAQ:PERI) offers data and AI-powered technologies through the Perion One platform to agencies, brands, and retailers to help them address the challenges of modern advertising and secure better results from their marketing investments across digital channels.
On February 19th, the company posted a 45% YoY drop in Q4 revenue to $129.6 million from $234.2 million due to muted revenue from the Advertising Solutions segment, as Open Web Video revenue fell 61% YoY. Meanwhile, Search Advertising revenue tanked by 78% YoY after previously announced changes implemented by Microsoft Bing in 2024. Despite a full-year 2024 drop in revenue and diluted EPS to $335.6 million and $1.27, respectively, the company set 2025 revenue guidance between $400 million and $420 million.
“Earlier this month, we announced our transformational ‘Perion One’ strategy and platform. This strategy will unify our brands and technologies into one advanced platform named ‘Perion One’, which will support our position as the partner of choice for brands, agencies, and retailers navigating the complexities of modern advertising. Perion One will harness advanced AI algorithms to help solve these challenges for our customers while aiming to optimize our cost structure and enhance our ability to scale in a more profitable way.”
-said Tal Jacobson, CEO of Perion Network Ltd.
4. Microchip Technology Inc. (NASDAQ:MCHP)
Number of Hedge Fund Holders: 37
Microchip Technology Inc. (NASDAQ:MCHP) supplies smart, easy-to-use, and secure embedded control and processing solutions, enabling clients in the automotive, industrial, aerospace, computing, and communications sectors to develop optimal designs while lowering risk, overheads, and time to market.
On February 19th, Microchip Technology (NASDAQ:MCHP) announced the launch of the MPLAB AI Coding Assistant, based on open-source AI code assistant Continue, to help software developers and embedded engineers write and debug code. The tool is a Microsoft Visual Studio Code extension, which comes preconfigured with Microchip’s AI chatbot for real-time support. It offers a unique sidebar chat feature for code evaluation and iteration. The feature-rich tool also comes with advanced autocomplete for simpler coding, an edit option, error detection, and seamless access to documentation on Microchip’s microcontrollers and processors.
“The MPLAB® AI Coding Assistant represents a significant leap forward in software development and will transform how engineers work with Microchip products. We’re harnessing the power of AI to provide interactive, real-time support that helps developers create better software, more quickly and with less hassle.”
-said Rodger Richey, VP of development systems and academic programs at Microchip Technology Inc.
3. Wix.Com Ltd. (NASDAQ:WIX)
Number of Hedge Fund Holders: 46
Wix.com Ltd. (NASDAQ:WIX) offers a free HTML5 website builder for desktop and mobile platforms. The cloud-based web development platform is popular for its no-code, drag-and-drop editing features and built-in business tools for eCommerce, marketing, and branding for users to grow their online presence efficiently. The company integrated a GenAI model into the platform to create AI images, teaser videos, text as well as swiftly develop CMS collections with the option to add an AI site assistant for customer query resolution.
On February 19th, Wix.com Ltd. (NASDAQ:WIX) posted a 14% YoY jump in Q4 revenue to $460.5 million, driven by the Business Solutions and Creative Subscriptions segments as well as due to the ramp in AI usage and new internal AI initiatives. Total Q4 booking rose 18% YoY to $464.6 million, and non-GAAP net income was $117.1 million or $1.93 per diluted share. For the full year 2024, total revenues were up 13% YoY to $1.761 billion, and non-GAAP net income stood at $6.39 per diluted share.
“Wix sets a high standard for innovation and creativity, and we’re constantly exceeding expectations. This past year was one of exciting innovation as we introduced revolutionary AI solutions such as the new generation AI Website Builder. We also made meaningful enhancements to the Studio platform, including the AI visual sitemap and wireframe generator and Figma integration among new advanced design capabilities. 2025 is poised to reimagine and expand the Self Creator experience with the launch of two transformative products planned for the spring and early fall. I strongly believe that these will deliver immense value to users and, in turn, accelerate Self Creator growth to double-digits in the years to come. We’re thrilled about these strategic enhancements, which are set to propel our business forward and establish a powerful foundation for the years ahead.”
– said Avishai Abrahami, Co-founder and CEO of Wix.Com Ltd.
2. Core Scientific Inc. (NASDAQ:CORZ)
Number of Hedge Fund Holders: 58
Core Scientific Inc. (NASDAQ:CORZ) offers digital infrastructure through its purpose-built data center for HPC and digital asset mining. The company is working to allocate and convert significant portions of its nine data centers across the US to support AI-related workloads.
On February 19th, Core Scientific Inc. (NASDAQ:CORZ) announced that it expanded into Auburn, Alabama, with a new HPC facility within the existing AUBix facility, which will begin operating with a 16 MW capacity in support of AI and enterprise customers. The company will make initial investments of almost $135 million, with total investments expected to surpass $400 million.
“Auburn represents an exciting new chapter for Core Scientific as we establish our presence in Alabama. This facility is expected to play a key role in our high-performance computing strategy, and we are grateful for the strong partnership and support from local and state leaders, including Auburn city officials. We look forward to contributing to Auburn’s growing technology sector and strengthening the regional economy.”
-said Adam Sullivan, Core Scientific CEO.
1. Arista Networks Inc. (NYSE:ANET)
Number of Hedge Fund Holders: 70
Arista Networks Inc. (NYSE:ANET) designs and sells client-to-cloud networking solutions, including an advanced network operating system, the CloudVision platform, and Cognitive Wi-Fi to large AI, data center, routing environments and Campus markets.
On February 18th, the company announced a 19.5% YoY increase in revenue to over $7 billion for the full year 2024 as its growing cash flow and robust balance sheet allowed consistent investments in strategic initiatives like AI and Campus markets. In Q4, Arista Networks Inc.’s (NYSE:ANET) revenue increased 6.6% YoY to $1.93 billion as non-GAAP net income surged to $830.1 million or $0.65 per diluted share from $0.52. Last quarter, the company said that Meta Platform (NASDAQ:META) also deployed the Arista 7700R4 Distributed Etherlink Switch for its latest Ethernet-based AI cluster. For Q1 2025, Arista Networks Inc. (NYSE:ANET) forecast revenue between $1.93 billion and $1.97 billion.
“2024 was a remarkable year of momentum resulting in a record $7 billion in revenue. I am so proud of the team’s execution in delivering the ultimate combination of superior growth and profitability. We continued to innovate for our customers with best-of-breed platforms enabling AI for networking and networking for AI.”
-said Jayshree Ullal, Chairperson and CEO of Arista Networks Inc.
While we acknowledge the potential of Arista Networks Inc. (NYSE:ANET) as an investment, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than ANET but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
READ NEXT: 20 Best AI Stock To Buy Now and Complete List of All AI Companies Under $2 Billion Market Cap.
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