5 Most Popular AI Penny Stocks to Buy Under $2 

4. Arbe Robotics Ltd. (NASDAQ:ARBE)

Arbe Robotics Ltd. (NASDAQ:ARBE) earns a place on our list of the most popular AI penny stocks to buy under $2.

Arbe Robotics Ltd. (NASDAQ:ARBE) is pivoting its commercialization focus toward defense, robotics, and off-road markets, beyond traditional automotive programs.

In its FY2025 results, Arbe Robotics Ltd. (NASDAQ:ARBE) said it is moving away from relying primarily on Western car manufacturers and expanding into new sectors that may offer more immediate demand. Specifically, sectors like defense, homeland security, and smart infrastructure are on management’s radar because of increasing interest and activity in those areas. At the same time, its collaboration with Nvidia adds credibility and capability.

For the year, Arbe Robotics Ltd. (NASDAQ:ARBE)’s revenue grew from $0.8 million in 2024 to $1.0 million, and net loss narrowed from $49.3 million to $45.2 million. At the same time, the year marked a strengthening of the company’s balance sheet, thanks to an $18.5 million capital raise and 15% cost reductions.

While management said it expects 2026 revenue to come in between $4 million and $6 million, it remains uncertain when the company will secure major deals with car manufacturers. The company’s earnings release was followed by an update from Canaccord, which cut its target on the stock from $1.75 to $1.25 and reiterated a “Buy” rating. The firm said the company is moving away from its original focus, which may result in delays in big automotive revenues.

Amid that broader optimism, Arbe Robotics Ltd. (NASDAQ:ARBE) also launched its 4D Imaging Radar for off-highway applications. With capabilities such as 360-degree environmental awareness and real-time processing, the product targets industries including agriculture, mining, and construction.

Arbe Robotics Ltd. (NASDAQ:ARBE) focuses on the development of radar and operating system technology for drones, automotive, and robotics markets. It offers 4D imaging radar solutions for autonomous vehicles.