On February 25, NVIDIA Corporation (NASDAQ:NVDA) CEO Jensen Huang said the market has miscalculated the impact of AI on software companies. Speaking to CNBC’s Becky Quick, Huang pushed back against concerns that AI agents will take over and hurt the enterprise software industry.
Huang believes that “the markets got it wrong.” Instead of cannibalizing the enterprise software industry, he believes agentic AI will help software companies develop their software and improve efficiency. He sees this as “counterintuitive,” explaining that AI agents are not going to eliminate software tools but will use them instead.
After Huang’s interview, Dan Niles, founder and portfolio manager of Niles Investment Management, told CNBC:
“People need to remember that all everything — whether it’s the railroads, canals, the internet, all of these things tend to get overbuilt — and then we figure out who the winners and losers are going to be.”
Niles believes that not every software company will survive as AI threatens to automate workflows, reduce prices, and make it easier for new competitors to enter the market. He believes that the companies in the database and cybersecurity industries may be better positioned to deal with these changes.
With this background in mind, let’s take a look at the 15 AI stocks with explosive growth potential.
Source: unsplash
Our Methodology
To compile our list of the 15 AI stocks with explosive growth potential, we looked for the largest and most popular AI companies. We reviewed Insider Monkey’s database of prominent AI stocks and various online resources to compile a list of more than 50 AI stocks. Next, we focused on the stocks that analysts believe have the most potential for growth. Finally, we ranked the top 15 AI stocks with explosive growth potential based on their average price target upside potential according to analysts as of March 2, 2026.
Additionally, we mentioned the hedge fund sentiment surrounding the best AI stocks, which was taken from Insider Monkey’s Q4 2025 database of 1041 elite hedge funds.
Why do we care about what hedge funds do? 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 427.7% since May 2014, beating its benchmark by 264 percentage points (see more details here).
15 AI Stocks With Explosive Growth Potential
15. Advanced Micro Devices, Inc. (NASDAQ:AMD)
Advanced Micro Devices, Inc. (NASDAQ:AMD) is one of the best AI stocks with explosive growth potential. On February 25, Piper Sandler reiterated its Overweight rating on Advanced Micro Devices, Inc. (NASDAQ:AMD) with a $300 price target. This update comes after the company announced a major chip supply deal with Meta Platforms, Inc. (NASDAQ:META).
The company entered into a 6-gigawatt, multi-year engagement, with initial deployment expected to begin in the second half of 2026. Piper Sandler believes the deal could position Advanced Micro Devices, Inc. (NASDAQ:AMD) to generate about $100 billion in revenue over the next five years. The warrants tied to the deal are set to expire in February 2031, meaning the related revenue would be recognized before that date.
Piper Sandler added that it expects Wall Street analysts to raise their revenue and earnings per share estimates for Advanced Micro Devices, Inc. (NASDAQ:AMD) as the deal moves forward.
On February 24, Jefferies also reaffirmed its Buy rating on Advanced Micro Devices, Inc. (NASDAQ:AMD) with a price target of $300. Jefferies said the deal with Meta Platforms, Inc. (NASDAQ:META) follows a structure similar to the company’s October 2025 agreement with OpenAI, where Advanced Micro Devices, Inc. (NASDAQ:AMD) agreed to exchange warrants for GPU revenue. The research firm pointed out that these deals come at a cost for the company. However, Jefferies noted that such deals are important for establishing a strong presence in the market and could help secure future business.
Advanced Micro Devices, Inc. (NASDAQ:AMD) is a global semiconductor company that manufactures GPUs, microprocessors, and high-performance computing solutions and serves a number of high-growth industries like gaming, data centers, and AI.
14. SAP SE (NYSE:SAP)
SAP SE (NYSE:SAP) is one of the best AI stocks with explosive growth potential. On February 2, Barclays reduced its price target on SAP SE (NYSE:SAP) from $348 to $283 and maintained an Overweight rating on the stock.
This update comes after the company reported fourth-quarter results, which Barclays thinks “were softer.” However, the research firm said the drop in the share price after the results “appeared harsh.” Barclays believes many of the risks are already reflected in the stock’s current price.
Earlier, on January 30, BMO Capital also lowered its price target on SAP SE (NYSE:SAP) from $320 to $245 but kept its Outperform rating on the stock. BMO pointed to the company’s failure to meet its guidance on cloud computing business growth targets in the December quarter. This miss came even though SAP SE’s (NYSE:SAP) management had earlier expressed confidence in meeting or exceeding those targets.
The research firm pointed out that SAP SE (NYSE:SAP) “picked a poor time to miss,” especially as investors are already concerned about AI’s impact on the software industry.
Despite these concerns, BMO is “supportive of SAP’s cloud conversion story,” highlighting the company’s strong retention rate.
SAP SE (NYSE:SAP) is a German multinational software company with a leading position in enterprise applications and business AI. The company is one of the world’s largest providers of enterprise resource planning software.
