2 Growth Stocks Down 48% to 81% to Buy Right Now

Key Points

• After missteps, Unity Software is laying the foundation for profitable growth under a new CEO.

• CoreWeave is experiencing insatiable demand for its AI-focused cloud computing services.

• 10 stocks we like better than Unity Software ›

Buying competitively positioned companies after a fall in their share price can be very profitable. This can provide patient investors a golden opportunity to scoop up shares at cheaper prices before more growth in the business sends the stock higher. If you're looking for attractive stocks to buy on the dip, here are two discounted tech stocks that could surge higher over the next year.

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1. Unity Software

Unity Software (NYSE: U) is one of the leading software providers for the video game industry, where it dominates the mobile game market. This was a high-growth business until 2024, when the business suffered from poor execution and ill-timed acquisitions that increased debt.

The stock is down 81% from its previous peak, but there's a new CEO leading the company now, and the shares have rebounded in 2025 following positive earnings results.

Unity's second-quarter earnings report still shows mixed performance, with revenue down slightly over the year-ago quarter. The company makes money from subscriptions (Create Solutions) and additional services that help companies monetize their games, such as advertising (Grow Solutions). Unity's Create segment reported double-digit subscription growth last quarter. CEO Matt Bromberg called the quarter "an inflection point," signaling the worst is behind the company.

Unity is launching new products to drive growth. Its positioning its ad business for more growth with the Vector artificial intelligence engine that can take advantage of valuable data to improve advertising performance.

Its Unity 6 game engine has been downloaded over 6.6 million times, representing a 50% increase over the previous quarter. The company signed new multiyear deals with two of the leading game companies in the world, Tencent and Nintendo, putting Unity in a solid position to continue serving the development of some of the biggest titles in the industry.

Unity is also having success expanding beyond the video game industry, reporting its 10th consecutive quarter of sequential growth in non-gaming markets like automotive and healthcare. This shows how Unity's real-time 3D software tools and virtual reality solutions can benefit various fields from medical training to prototyping new product designs.

Wall Street analysts certainly see 2025 as an inflection point year for the company. The consensus analyst estimate calls for adjusted earnings to reach $1.13 by 2027 up from about $0.80 expected this year. If Unity can get its revenue growing along with improving earnings, the stock could offer significant upside over the next five years.

Image source: Getty Images.

2. CoreWeave

As businesses plow billions into advanced computing infrastructure to take advantage of artificial intelligence (AI), it's benefiting CoreWeave (NASDAQ: CRWV). CoreWeave has a growing footprint of data centers stocked with the latest graphics processing units (GPUs) to run compute-intensive workloads. Enterprises use CoreWeave over a cloud-based platform where they can run data analysis, and build AI tools and applications. The stock just started trading earlier this year but is currently down 48% from its recent highs. The dip is a great buying opportunity.

CoreWeave generates most of its revenue through long-term contracts with the balance coming from on-demand services. As you would expect given the AI tsunami sweeping across the economy, the company is seeing robust demand. Revenue tripled year over year in Q2 to $1.2 billion. Its revenue backlog hit $30 billion, up 86% year over year.

One drawback for CoreWeave is weak profitability. Data center buildouts require substantial upfront costs to get infrastructure up and running to meet customer demand. CoreWeave reported a loss of $290 million in Q2. The business has issued debt to finance its investments, where interest expense is also cutting into the bottom line.

The company's total debt burden stood at about $11 billion at the end of the second quarter, which along with losses on the bottom line, is why the stock is volatile. However, that's to the advantage of a long-term investor. The reason to be bullish about the stock's upside is the strong growth in revenues, growing backlog of orders, and importantly, CoreWeave's relationship with AI chip leader Nvidia.

CoreWeave's relationship with Nvidia gives it a competitive advantage. This has allowed it to gain early access to Nvidia's Blackwell data center chips for its customers, which is one factor fueling demand for its cloud computing services. Nvidia also holds a large stake in CoreWeave stock worth nearly $4 billion at the end of Q2.

This stock may not be for everyone due to its volatility, but I believe patient investors could see excellent returns over the next few years. If it meets the consensus Wall Street estimate for adjusted operating income to reach $7.5 billion by 2029, up from an expected $716 million this year, the stock could soar.

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John Ballard has positions in Nvidia. The Motley Fool has positions in and recommends Nvidia, Tencent, and Unity Software. The Motley Fool recommends Nintendo. The Motley Fool has a disclosure policy.