AI, Cryptocurrency Top Tech Stocks: AppLovin, MicroStrategy, Palantir, Nvidia

Artificial intelligence is still an abstract concept for many everyday consumers, unsure of what changes it will bring to their lives. But there’s no question whether companies see value in it.

Some of the biggest winners in this year’s stock market rally, with the Nasdaq up 33% and other U.S. indexes posting double-digit gains, are directly related to rapid advances in AI. chip manufacturer Nvidia are among them, but they are not the only ones.

Another prominent theme that drove this year’s performance was cryptography. Starting with the launch of the Spot Bitcoin ETF in January, the cryptocurrency industry made a big splash in 2024, but this was interrupted by the election victory of Donald Trump, to whom the cryptocurrency industry provided a large amount of funding. It was done. Many stocks related to cryptocurrencies rose significantly.

With four business days left this year, here are the five best-performing U.S. tech stocks in 2024 among companies valued at $5 billion or more.

App Lovin entered the year with a market capitalization of about $13 billion and was best known for investing in a collection of mobile game studios that produced titles such as “Woody Block Puzzle,” “Clockmaker” and “Bingo Story.”

At the end of this year, AppLovin’s valuation soared to over $110 billion; starbucks, intel and airbnb. As of Tuesday’s close, AppLovin stock is up 758% since the beginning of the year, far outpacing other tech companies.

AppLovin went public in 2021 riding a wave of excitement around online gaming during the COVID-19 era, but is now putting the burgeoning profits of online advertising and advances in AI at the heart of its business.

Last year, AppLovin released the latest version 2.0 of its advertising search engine called AXON. It helps the company run more targeted ads in gaming apps it owns, and is also used by studios that license the technology. Software platform revenue increased 66% to $835 million in the third quarter, outpacing overall growth of 39%.

Net income increased 300% in the quarter, and the company’s profit margin rose from 12.6% to 36.3% over the year.

AppLovin CEO Adam Foroughi, whose net worth has ballooned to over $10 billion, is even more excited about what’s to come. During the company’s earnings call in November, Foroughi raved about a test e-commerce project that allows companies to offer targeted advertising within games.

“It’s the best product I’ve ever released, and it’s growing rapidly, but it’s still in the testing phase,” he said.

After a 346% rise in 2023, it was hard to imagine MicroStrategy I’m looking for another gear. But it happened.

The company’s stock price has soared 467% this year on the back of a Bitcoin buying strategy that made founder Michael Saylor a crypto cult hero.

In mid-2020, the company announced plans to start purchasing Bitcoin. Up until that point, MicroStrategy was a mid-sized business intelligence software vendor, but since then, it has purchased 444,000 Bitcoin, using the continued rise in its stock price as a means to sell stock, raise debt, and buy more coins. I did.

The company is currently the world’s fourth-largest Bitcoin holder behind creator Satoshi Nakamoto, BlackRock’s iShares Bitcoin Trust, and cryptocurrency exchange Binance, with a stockpile of nearly $44 billion. . MicroStrategy’s market capitalization has grown from about $1.1 billion when it was just a software company to $80 billion today.

The rallies had been going on for a long time before November, but gained momentum after President Trump’s election victory last month. Since then, the stock is up 57%, and Bitcoin is up about 44%. Although Trump once called Bitcoin a “fraud,” he was the industry’s preferred choice in this election, receiving significant support from some of the most powerful companies, including: coinbase.

“Due to the red sweep, Bitcoin is surging with tailwinds, and the rest of the digital assets will start to soar as well,” Saylor told CNBC shortly after the election. He said Bitcoin remains a “secure transaction” in the cryptocurrency space, but as “digital asset frameworks” are put in place for the broader crypto market, “there will be a surge across the digital asset industry. ” he said.

Palantir has made many big gains en route to a 380% share price increase in 2024. One of the company’s best gains came last month, when the software company raised its earnings outlook on the eve of the presidential election.

The company, which sells data analytics tools to defense agencies, released fourth-quarter guidance that blew away analysts’ expectations and raised its 2024 targets. Palantir also led the way in the third quarter, with CEO Alex Karp saying in an earnings call: “We were absolutely gutted this quarter, driven by unabated and relentless demand for AI.” declared.

The stock soared 23% following the earnings release, and rose another 8.6% the day after President Trump’s victory. Palantir co-founder and director Peter Thiel was a big supporter of Trump during the 2016 campaign, helping organize a meeting with tech executives at Trump Tower shortly after the election. Karp was one of the participants.

However, Karp has publicly supported Democratic candidate Vice President Kamala Harris in the 2024 election. He said in a New York Times article published in August that Thiel’s early support for Trump and subsequent backlash “really made it harder to get things done.”

Still, Wall Street rallied behind Palantir after the election on optimism that more military spending would flow to the company.

Karp’s comments on the pre-election earnings call suggest the company is fine either way.

“In response to continued demand for cutting-edge artificial intelligence technology from the U.S. government and commercial customers, our business growth is accelerating and our financial performance exceeded expectations,” Karp said in a letter to shareholders. “

Analysts expect sales to rise about 24% to $3.5 billion in 2025, according to LSEG.

robin hood The stock has more than tripled this year, despite falling 17% on Oct. 31 following disappointing earnings results.

A few days later, investors ignored these numbers and the stock rose 20% as everything related to cryptocurrencies rose after President Trump’s election victory. One of Robinhood’s biggest growth drivers is cryptocurrencies, which retail investors can easily purchase alongside stocks on the app.

Revenue from cryptocurrency trading in the third quarter increased 165% year over year to $61 million and accounted for 10% of total net revenue.

In addition to Bitcoin, Robinhood users can easily purchase about 20 other cryptocurrencies, ranging from popular digital assets like Ethereum to altcoins like Dogecoin, Shiba Inu, and Bonk. At the company’s investor day in November, Robinhood CEO Vlad Tenev said that cryptocurrencies are more than just an investment, they are “a disruptive force that will change the infrastructure underlying payments, lending, and a wide range of tradable assets.” “It’s also about technology,” he said.

Analysts expect Robinhood’s fourth-quarter revenue to rise more than 70% to $805.7 million, the most in any quarter since 2021, when the company went public, according to LSEG. It is said to have a high growth rate.

Robinhood’s gains this year have outpaced Coinbase’s gains of 61%. But Coinbase, with a market cap of $70 billion, is still worth twice as much.

Nvidia’s The amazing run continued.

Nvidia has soared another 183% this year, reaching a whopping $2.2 trillion in market capitalization, following a 239% rise last year on the rise of generative AI.

This year, NVIDIA has won the title of the world’s most valuable publicly traded company twice. apple Nvidia is $3.4 trillion; Nvidia is $3.4 trillion; microsoft 3.3 trillion dollars.

Nvidia remains the biggest beneficiary of the AI ​​boom, as the biggest cloud vendors and internet companies buy up every graphics processing unit they can find. Annual revenue has increased by at least 94% in each of the past six quarters, with growth exceeding 200% three times during that period.

CEO Jensen Huang said in the company’s latest earnings call that its next-generation AI chip, called Blackwell, is in “full production.” Finance chief Colette Kress said the company expects to capture Blackwell’s “billions of dollars” in revenue in the fourth quarter.

“Every customer is competing to be first to market,” Kress said. “Blackwell is now in the hands of all our major partners, and each partner is working to ramp up their data centers.”

Growth is expected to continue to be strong for a company of Nvidia’s size, but an inevitable slowdown is approaching. Analysts expect growth to slow year-on-year over the next few quarters, dropping to the mid-40s by the second half of next year.

Nvidia relies on huge revenues from a small number of technology giants, so economic fluctuations pose a big risk for investors.

This explains why Nvidia is building new AI services and attracting a wide range of companies “racing to accelerate the development of these applications, which could see billions of agents deployed over the next few years.” on an earnings call that Kress said helps explain what he wants to tell Wall Street about the roster.

Attention: Next year will be a “stock picking market”