In the United States, AI infrastructure spending is surging: Nvidia’s CEO projects a $3–4 trillion opportunity in AI infrastructure by 2030, driven by escalating demand from hyperscalers and major tech firms, per latest information by news agency Reuters. The chipmaker also anticipates that fiscal 2027 revenues could reach $366 billion, exceeding forecasts, a further signal that generative AI continues to propel growth across sectors. At the same time, rising costs and fierce competition are shaping infrastructure dynamics. Dell, for instance, has raised its annual shipment forecast for AI-optimized servers to $25 billion, up from $20 billion, as demand from clients like xAI and CoreWeave heats up. Nevertheless, high manufacturing costs and compressed margins are compressing profits, even as server sales ramp up.
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In China, regulators are adopting a more centralized approach to steer the rapidly expanding AI market. Authorities are distributing responsibilities across provinces to avoid redundant investment and to nurture regional strengths, while simultaneously supporting homegrown innovation through backing companies like DeepSeek, per a report by Reuters. Yet, observers warn that overregulation could limit agility for smaller firms and amplify past missteps in sectors like semiconductors. Labor dynamics also underscore AI’s evolving role in the economy. US Labor Secretary Lori Chavez-DeRemer recently reassured, per The New York Post, that AI is not poised to replace American workers, but to augment their roles—through reskilling initiatives, training programs, and generous federal investment.
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Our Methodology
For this article, we used stock screeners to identify AI data center stocks. The top twelve stocks were then ranked based on hedge fund interest. Data for the hedge fund sentiment surrounding each stock was taken from Insider Monkey’s Q4 2025 database of 1041 elite hedge funds.
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 498.7% since May 2014, beating its benchmark by 303 percentage points (see more details here).
Best AI Data Center Stocks to Buy Right Now
12. Innodata Inc. (NASDAQ:INOD)
Number of Hedge Fund Holders: 23
Innodata Inc. (NASDAQ:INOD) has emerged as a data engineering partner for big tech companies in recent months. The firm has successfully pivoted to high-complexity data engineering for the Magnificent Seven and other frontier model builders. This provides it with a deep technical moat. Unlike competitors that use crowdsourced workers, Innodata utilizes subject-matter experts for Supervised Fine-Tuning (SFT) and Reinforcement Learning from Human Feedback (RLHF). In early 2026, Innodata secured a major partnership with Palantir to modernize AI-powered rodeo analytics and expanded its SHIELD contract for LLM safety. The overall financial performance of the company speaks for itself as well.
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Innodata Inc. (NASDAQ:INOD) reported 48% full-year organic revenue growth for 2025, reaching $251.7 million. Management has guided for 35%+ revenue growth in 2026. Hedge funds like Schonfeld Strategic Advisors and Millennium Management have established new or expanded positions to capture this upside. At the end of 2025, the company held $82.2 million in cash, allowing it to self-fund innovation in agentic AI and robotics data without diluting shareholders. It is also expanding into Physical AI. Innodata is now building egocentric and affordance-rich datasets used to train robots and drones. The company recently achieved a 6.45% improvement over previous state-of-the-art benchmarks in drone object detection, positioning it as a critical supplier for autonomous systems.
11. Equinix, Inc. (NASDAQ:EQIX)
Number of Hedge Fund Holders: 51
Elite investor interest in Equinix, Inc. (NASDAQ:EQIX) stock is driven by the company’s role as the interconnection hub for the AI era, with accelerating bookings and margin expansion turning heads on Wall Street. In the broader context, investors have been shifting their thesis from AI training, which happens in massive, isolated clusters, to AI inference, which happens where data meets the user. Per Equinix management, the firm is uniquely positioned for the inference stage of AI. This is because as AI models need to interact with real-world data in real-time, the need for residence in Equinix’s highly connected metros rather than remote rural data centers rises. The company has large deal momentum behind it as well, as AI-driven large deals rose to 60% of total bookings in the most recent quarter, up from 50% just months prior.
Equinix, Inc. (NASDAQ:EQIX) is posting record-breaking bookings and guidance numbers. In Q4 2025, the firm reported annualized gross bookings of $474 million, a 42% increase year-over-year. It also raised its full-year 2026 revenue guidance to over $10.1 billion, signaling growth that is significantly ahead of the targets shared at their 2025 Analyst Day. The firm is taking steps to de-risk the power constraint for investors as well. In 2025, Equinix added approximately 1 GW to its powered land-under-control balance. Strategic partnerships, including a major deal for 2.8 gigawatts of fuel-cell capacity, have allowed Equinix to bypass utility delays. This speed-to-market is a key reason why prominent investors favor this stock over slower-moving REIT peers.
10. Astera Labs, Inc. (NASDAQ:ALAB)
Number of Hedge Fund Holders: 52
Astera Labs, Inc. (NASDAQ:ALAB) is becoming a hedge fund favorite as it is at the forefront of solving the compute-to-data bottlenecks. The firm’s Aries smart retimers and Scorpio smart fabric switches are essential for maintaining signal integrity as data moves between GPUs and memory. If they do not have these, AI clusters cannot physically scale beyond a few thousand chips without massive performance lag. Another catalyst for the shares is PCIe Gen 6 adoption. In early 2026, PCIe Gen 6 products reached a tipping point, contributing over 20% of total revenue for the firm. This transition is a boost for the stock as Gen 6 infrastructure is significantly more expensive and higher-margin than previous generations.
Astera Labs, Inc. (NASDAQ:ALAB) financials are also painting a rosy picture. For Q4 2025, the company reported $270.6 million in revenue, up 91.8% year-over-year, beating analyst estimates by a wide margin. The company maintains a 75.6% gross margin, which is at the very top of the semiconductor sector. Investors are monitoring the launch of the Scorpio smart fabric switch as well. By moving into switches, Astera Labs is expanding its Total Addressable Market. Analysts at Loop Capital recently raised their price target on the stock to $250, citing strong demand for Scorpio as the industry standard for backend AI networking. Major hedge funds like D.E. Shaw and Atreides Management have maintained large positions, betting that the firm will become the Arista of the motherboard, managing the internal traffic of the AI server rack.
9. Celestica Inc. (NYSE:CLS)
Number of Hedge Fund Holders: 71
Celestica Inc. (NYSE:CLS) is becoming famous for being not just a simple hardware manufacturer, but a critical design and engineering partner for the world’s largest AI clusters. The most recent driver for investor interest in the stock is the deepening role of the firm in rack-scale AI platforms.In March 2026, Celestica was confirmed as a primary collaborator for AMD’s Helios rack-scale platform. This positions the firm to handle the complex engineering and manufacturing of networking components for the next generation of AI infrastructure. Elite investors are also tracking the massive capex pull-forward from Google and Meta. As these titans accelerate their 2027 infrastructure spending into 2026, Celestica is seeing an immediate boost in its Connectivity & Cloud Solutions (CCS) segment.
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Celestica Inc. (NYSE:CLS) is also emerging as the primary beneficiary of the networking bottleneck. The company is currently transitioning from 800G to 1.6T networking programs. These high-speed switches and routers carry significantly higher margins than legacy hardware. Analysts at JP Morgan and CIBC recently raised their price targets on the stock, citing that Celestica is capturing market share from traditional OEMs by working directly with hyperscalers to design custom, proprietary hardware. The earnings consistency of the firm should also be lauded. Celestica has beaten EPS consensus estimates by an average of 10% since 2022. For the upcoming Q1 2026 report, analysts are projecting for another beat and raise driven by new manufacturing capacity in Texas and Thailand.
8. Constellation Energy Corporation (NASDAQ:CEG)
Number of Hedge Fund Holders: 76
Wall Street bigwigs have been treating Constellation Energy Corporation (NASDAQ:CEG) stock more like a tech infrastructure company than a traditional utility. In early 2026, tech giants like Microsoft, Amazon, and Google have signaled a willingness to pay a significant premium over standard market rates for nuclear baseload power. Unlike wind or solar, nuclear provides the 24/7 reliability required for massive AI training clusters. CEG is one of the leading providers of this service. The firm also operates largely in the unregulated wholesale market. This allows it to negotiate direct behind-the-meter contracts with data centers at market-clearing prices, rather than being limited by government-regulated rate caps.
A major catalyst for Constellation Energy Corporation (NASDAQ:CEG) shares in the near-term is the de-risking of nuclear power. The Department of Energy’s approval of a $1 billion loan to restart the Crane plant operated by CEG is seen as a historic pivot. This project adds 835 MW of carbon-free capacity to the grid, specifically earmarked for high-demand AI regions. In January 2026, the regulatory bodies approved a first-of-its-kind $167 million digital safety upgrade for the Limerick station operated by CEG. This shift from analog to digital reduces long-term maintenance costs and improves fleet reliability. The company continues to execute financially. CEG reported Q4 2025 earnings of $2.30 per share, beating estimates of $2.26. More importantly, revenue of $6.07 billion shattered expectations of $5.35 billion.
7. Cisco Systems, Inc. (NASDAQ:CSCO)
Number of Hedge Fund Holders: 77
Cisco Systems, Inc. (NASDAQ:CSCO) is being treated as a value AI play in the hedge fund universe. The firm is pivoting from a hardware provider to an AI-native security and networking powerhouse. Cisco’s rapid acceleration in AI networking orders from major cloud providers like Amazon, Microsoft, and Google has grabbed headlines. In fiscal Q2 2026, the firm reported $2.1 billion in AI infrastructure orders, a massive jump from $1.3 billion the previous quarter. Management has projected over $3 billion in AI infrastructure revenue for the full fiscal year. Investors view this as proof that Cisco’s Silicon One chips are successfully competing with specialized rivals for the digital backbone of AI data centers.
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Cisco Systems, Inc. (NASDAQ:CSCO) shift toward high-margin software also merits a closer look. By integrating Splunk, the firm has created a unified view of networking and security that is unique in the market. Hedge funds are also positioning for a multi-year hardware upgrade cycle driven by new standards. Enterprises are beginning a massive refresh to support the high-bandwidth needs of AI. Cisco expects this to be a multi-billion dollar refresh opportunity as support for older 4K and 6K switches ends. Networking product orders grew in the high teens for the company recently, marking five consecutive quarters of double-digit growth. For many, Cisco has become a value tech staple as the stock often trades at a forward P/E of roughly 16x–18x, ideal for funds that want AI exposure without the risk of a bubble burst.
6. Eaton Corporation plc (NYSE:ETN)
Number of Hedge Fund Holders: 87
Last month, Eaton Corporation plc (NYSE:ETN) officially established a dedicated Data Center segment, following its $9.5 billion acquisition of Boyd’s thermal business. This move signals that the company is no longer just selling parts but providing integrated power and cooling solutions specifically for AI. With AI chips now exceeding 1,000W, traditional air cooling is failing and investors are buying Eaton shares because the Boyd acquisition gives the company a dominant position in liquid cooling, which is expected to be a standard requirement for all new AI data centers by 2027.
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The Electrical Americas segment of Eaton Corporation plc (NYSE:ETN) has emerged as a leading indicator of US infrastructure health. In early 2026, the firm reported that sales in this segment jumped 16%, driven by what management called unprecedented data center momentum. There is mega-project momentum behind the shares as well. Eaton has a $13.3 billion backlog and is the primary electrical provider for several mega-projects – data centers and semiconductor plants exceeding $1 billion in cost – which provides revenue visibility through 2028. Eaton has matched or exceeded Wall Street earnings estimates for four consecutive quarters. Wall Street expects the firm’s EPS to grow by 13%–15% annually through 2027, a growth rate more typical of a software company than a 100-year-old industrial firm.
While we acknowledge the potential of ETN to grow, 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 ETN and that has 100x upside potential, check out our report about the cheapest AI stock.
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