OpenAI, the startup known to have started the AI arms race through its chatbot ChatGPT, is hitting new milestones as it soars to new heights. The company is all set to reach the 700 weekly active users mark for ChatGPT this week, up from 500 million in March.
This marks more than a fourfold year-over-year surge in growth for the conversational AI chatbot.
“Every day, people and teams are learning, creating, and solving harder problems.”
-Nick Turley, VP of product for ChatGPT.
The company’s paying business users on ChatGPT have also surged from three million in June to five million.
While ChatGPT may be growing tremendously, it is yet to reach the reported number of user numbers for Google’s AI Overviews, which boasts two billion monthly users across 200 countries.
Nevertheless, all kinds of AI chatbots, whether its ChatGPT or AI Overviews, are not only transforming how we search and process information, but also fueling an intense race amongst tech giants to dominate an AI-enabled future.
For this article, we selected AI stocks by going through news articles, stock analysis, and press releases. These stocks are also popular among hedge funds. The hedge fund data is as of Q1 2025.
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).
An overhead view of a bustling stock exchange, with brokers and traders exchanging stocks.
10. Palantir Technologies Inc. (NASDAQ:PLTR)
Number of Hedge Fund Holders: 77
Palantir Technologies Inc. (NASDAQ:PLTR) is one of the 10 Trending AI Stocks on Wall Street. On August 5, Wedbush analyst Dan Ives raised the price target on the stock to $200.00 (from $160.00) while maintaining an Outperform rating.
The company raised its full-year 2025 revenue guidance, projecting growth for its US commercial business due to strong adoption of its Artificial Intelligence platform among enterprise and federal customers.
Analysts led by Ives particularly cited continued hyper growth demand for Palantir’s AI product suite behind the rating affirmation and price target raise.
“We maintain our OUTPERFORM rating on PLTR while raising our price target from $160 to $200 reflecting continued hyper growth demand for the company’s AI product suite with the use case era of the AI Revolution now here. This was another eye-popping quarter for the Messi of AI as AIP continues gaining unprecedented interest across the commercial landscape with US Commercial front and center seeing 93% y/y growth with more enterprises looking to PLTR for complex AI use cases.”
The firm believes Palantir has the potential to be a trillion dollar market cap as the artificial intelligence revolutions gains ground.
“We believe Palantir has a “golden path to become the next Oracle” over the coming years and will grow into its valuation.”
Palantir Technologies Inc. (NASDAQ:PLTR) is a leading provider of artificial intelligence systems.
9. QUALCOMM Incorporated (NASDAQ:QCOM)
Number of Hedge Fund Holders: 82
QUALCOMM Incorporated (NASDAQ:QCOM) is one of the 10 Trending AI Stocks on Wall Street. On July 31, Piper Sandler analyst Harsh Kumar lowered the firm’s price target on the stock to $175 from $190 and kept an “Overweight” rating on the shares.
The firm noted how Qualcomm has delivered slightly above expectations with guidance largely in-line with estimates. It has been implementing its diversification well, and is poised for growth in key areas such as auto and IoT.
QUALCOMM Incorporated (NASDAQ:QCOM) develops wireless technologies, supplies chips for mobile, automotive, and IoT, licenses patents, and invests in emerging tech.
8. Tesla, Inc. (NASDAQ:TSLA)
Number of Hedge Fund Holders: 104
Tesla, Inc. (NASDAQ:TSLA) is one of the 10 Trending AI Stocks on Wall Street. On August 4, Morgan Stanley analyst Adam Jonas reiterated an Overweight rating and $410.00 price target on Tesla (NASDAQ: TSLA).
According to the firm, their summer intern class has provided “a window on the preferences of a future generation of business leaders and commercial influencers.”
As such, only 5% of interns have labeled Tesla as their “most desirable car brand.” There also seems to be a declining interest in Tesla’s robotaxi service among the group.
“Our summer intern class provides a window on the preferences of a future generation of business leaders and commercial influencers. Just 5% of interns listed Tesla as their ‘most desirable car brand’ (down from 11% LY), while preference for a Tesla robotaxi service also fell sharply to 12% from 31%.”
Tesla, Inc. (NASDAQ:TSLA) is an automotive and clean energy company that leverages advanced artificial intelligence in its autonomous driving technology and robotics initiatives.
7. ServiceNow, Inc. (NYSE:NOW)
Number of Hedge Fund Holders: 106
ServiceNow, Inc. (NYSE:NOW) is one of the 10 Trending AI Stocks on Wall Street. On August 4, Citizens JMP analyst Patrick Walravens reiterated a “Market Outperform” rating on the stock with a $1,300.00 price target.
The firm met with ServiceNow’s investor relations team on Thursday, coming away optimistic on the stock. In particular, they observed the latest demonstration of the AI Control Tower product and AI Agents in AI Agent Studio.
The team included VP of Investor Relations Darren Yip, Senior Manager of Investor Relations Andrew Libert, and investor relations members Christine Bancroft and Alexander Yuan.
“We saw the latest demonstration of the AI Control Tower product as well as a demonstration of AI Agents in AI Agent Studio, and after the stock has decreased 14% year to date versus an increase of 6% for the Russell 3000.”
ServiceNow, Inc. (NYSE:NOW) is a technology company that offers a cloud-based software platform for automating business workflows within an enterprise.
6. Adobe Inc. (NASDAQ:ADBE)
Number of Hedge Fund Holders: 111
Adobe Inc. (NASDAQ:ADBE) is one of the 10 Trending AI Stocks on Wall Street. On August 2nd, Morgan Stanley reiterated an Overweight rating on the stock with a price target of $510. The rating affirmation and positive outlook stems from the thesis that Adobe is poised to capture incremental value from several opportunities as generative AI capabilities boost Creative Cloud growth.
According to the firm’s bull case, Creative Cloud + GenAI will expand the user base and push pricing higher. This will in turn deliver a DM revenue CAGR of 13% over FY23-FY26. With improved integration and execution in Digital Experience, an 11% revenue CAGR will be delivered over FY23-FY26. This will take the total revenue CAGR to 12%.
The firm further talked about three growth drivers for Adobe. Its role in managing diffusion engines, its improving digital media ARR growth, and also an accelerated pace of buybacks. It believes Adobe is expanding its models with better capabilities for the end user.
The firm particularly discussed how Adobe is adding abilities like better price and value matching, accelerating GenAI tool adoption into Adobe workflows. This will in turn help investors realize the value of being able to edit a broad set of images in a collaborative environment.
The firm notices a potential for modest upside to 2H Digital Media ARR growth despite guidance including the latest price change.
5. Apple Inc. (NASDAQ:AAPL)
Number of Hedge Fund Holders: 159
Apple Inc. (NASDAQ:AAPL) is one of the 10 Trending AI Stocks on Wall Street. On August 4, Goldman Sachs analyst Michael Ng reiterated a Buy rating on the stock with a $266.00 price target. The rating affirmation follows strong App Store performance data. The firm estimates that App Store is the largest category within Apple Services revenue.
Sensor Tower data reveals how July 2025 Apple App Store spending grew 13% year-over-year, which is the fastest monthly year-over-year growth since November 2024.
The firm noted that this growth is in-line with the firm’s estimate for AAPL F4Q25E Services revenue growth of +13% year-over-year.
“Notably, Apple App Store spending accelerated in the US (+13% v. +12% yoy in June 2025), despite concerns over user adoption of third-party payment options. We estimate App Store is the largest category within AAPL Services revenue, representing 25-20% of Services revenue.”
Apple is a technology company known for its consumer electronics, software, and services.
4. Alphabet Inc. (NASDAQ:GOOGL)
Number of Hedge Fund Holders: 227
Alphabet Inc. (NASDAQ:GOOGL) is one of the 10 Trending AI Stocks on Wall Street. On August 4, Citizens JMP analyst Andrew Boone reiterated a Market Outperform rating on the stock with a $225.00 price target.
In a note issued to investors, Citizens JMP expressed their positive outlook toward the stock. It noted that Google has a significant opportunity to streamline corporate accesses, improving its financial performance.
The rating comes amid Google navigating itself in the technology landscape while managing its operational efficiency.
Google “which has long had opportunity to streamline corporate excesses as 2026 could see higher incremental profitability beyond the increase in depreciation and infrastructure costs.”
Alphabet Inc. (NASDAQ:GOOGL) is an American multinational technology conglomerate holding company wholly owning the internet giant Google, amongst other businesses.
3. Meta Platforms, Inc. (NASDAQ:META)
Number of Hedge Fund Investors: 273
Meta Platforms, Inc. (NASDAQ:META) is one of the 10 Trending AI Stocks on Wall Street. On July 31, DA Davidson analyst Gil Luria raised the price target on the stock to $825.00 (from $650.00) while maintaining a “Buy” rating.
Meta delivered strong Q2 earnings, beating expectations on both the top and bottom line. Growth in Meta’s Family of Apps fast-tracked, reflecting how the heightened capital expenditures and hiring frenzy has the potential to pay off as it further integrates AI into their products.
“Strong Ad Growth Supporting Superintelligence Pursuit We reiterate our BUY rating and raise our price target from $650 to $825 following a strong 2Q25 earnings that beat expectations on both the top and bottom line. Growth in Meta’s Family of Apps accelerated, signaling that the heightened capital expenditures and hiring frenzy could continue to pay off as they further integrate AI into their products. Management specifically noted that they have all the ingredients required to both build and deliver superintelligence, with increased compute capacity in the coming years to support these endeavors.”
2. Microsoft Corporation (NASDAQ:MSFT)
Number of Hedge Fund Holders: 284
Microsoft Corporation (NASDAQ:MSFT) is one of the 10 Trending AI Stocks on Wall Street. On August 4, Stifel analyst Brad Reback reiterated a Buy rating on the stock with a $650.00 price target. The rating affirmation follows positive earnings commentary and strong partner checks for Microsoft Fabric, the company’s unified, end-to-end, SaaS (Software as a Service) data analytics platform.
According to Stifel, Fabric is the fastest-growing platform in the company’s history.
“The product is already demonstrating strong momentum, as just two years post launch it has >25k customers and 55% Y/Y revenue growth, and represents the fastest-growing data platform in Microsoft’s history. Given this, we decided to dive deeper into Microsoft Fabric and its subset of capabilities (Data Factory, Synapse, PowerBI, OneLake, etc.), as we believe that the offering differentiates Microsoft’s data stack from other vendors.”
The firm believes that even though Fabric offers many products and capabilities that may have broader implications for other data analytics companies, it is likely possible for all of these solutions and tools to coexist.
“Not surprisingly, given the broad set of products and capabilities within Microsoft Fabric, we expect competitive implications for the broader data analytics ecosystem, including both Snowflake and Databricks. That said, given the accelerating pace that enterprises are moving to modernize their respective data estates in order to effectively leverage rapidly evolving genAI tools we believe the solutions can co-exist for years to come.”
Microsoft Corporation (NASDAQ:MSFT) provides AI-powered cloud, productivity, and business solutions, focusing on efficiency, security, and AI advancements.
1. Amazon.com, Inc. (NASDAQ:AMZN)
Number of Hedge Fund Holders: 328
Amazon.com, Inc. (NASDAQ:AMZN) is one of the 10 Trending AI Stocks on Wall Street. On August 1, TD Cowen analyst John Blackledge raised the price target on the stock to $255.00 (from $250.00) while maintaining a “Buy” rating.
The rating affirmation follows Amazon’s second-quarter results on July 31st, exceeding expectations. AWS growth was largely in-line with expectations despite AI capacity constraints.
“AMZN 2Q25 rev was 3% above cons, incl NA / Int’l beats of +2.5% / +7%; AWS rev grew 17.5% y/y, largely in line amid ongoing AI capacity constraints, while adv beat cons by 5%. Op Inc beat consensus by 14% despite AWS miss on higher ad rev and cont’d lower cost to serve. 3Q25 rev and Op Inc guide were +3.6% and +5.2% vs cons (high end). We raised LT ests, maintain Buy, PT to $255. Shares (6%) AH.”
The firm has raised its total revenue forecast by 2.4% for 3Q25 after the results and outlook. It maintained a Buy rating and $255 price target.
Amazon.com Inc. (NASDAQ:AMZN) is an American technology company offering e-commerce, cloud computing, and other services, including digital streaming and artificial intelligence solutions.
While we acknowledge the potential of AMZN as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and have limited downside risk. If you are looking for an AI stock that is more promising than AMZN and that has 100x upside potential, check out our report about this cheapest AI stock.
READ NEXT: 10 AI Stocks in the Spotlight Today and 10 AI Stocks Analysts Are Tracking Closely
Disclosure: None. Insider Monkey focuses on uncovering the best investment ideas of hedge funds and insiders. Please subscribe to our free daily e-newsletter to get the latest investment ideas from hedge funds’ investor letters by entering your email address below.
Hedge Fund Resource Center