Like in 2025, the rapid growth of artificial intelligence (AI) is expected to persist in 2026 and beyond, driving demand for AI hardware, software and cloud infrastructure worldwide. Micron Technology, Inc. MU, Palantir Technologies Inc. PLTR and NVIDIA Corporation NVDA have already ridden the AI wave and are well poised to gain from the expanding trend, making them attractive investment opportunities for the year ahead. Let’s see in detail –
Micron Ups View As HBM Demand Booms, Delivering Strong FY25
Micron’s status as the sole U.S.-based memory manufacturer has given the company a distinct advantage to ride the accelerating AI wave. That’s why Micron’s CEO, Sanjay Mehrotra, said that the company “is entering fiscal 2026 with strong momentum.”
The incessant demand for Micron’s high-bandwidth memory (HBM) chips, which can curb power consumption and process large volumes of data, has driven the company’s performance in fiscal 2025. In the fiscal fourth quarter, Micron reported revenues of $11.32 billion, an increase from $7.75 billion in the prior year. For the full fiscal year, revenues reached $37.38 billion, up from $25.11 billion in the previous year, according to investors.micron.com.
Strong demand for HBM chips prompted Micron to raise its fiscal first-quarter revenue outlook to $12.5 billion. Micron’s cloud memory business also showed signs of improvement, and the company reported a net income of $8.54 billion for fiscal 2025. On this optimism, Micron’s estimated earnings growth rate for the next fiscal year is a solid 24.4%.
Palantir Sees Strong Growth as AIP Soars in U.S. Markets
A larger number of clients, both from the U.S. commercial sector and government segment, are adopting Palantir’s successful Artificial Intelligence Platform (AIP). The growing demand for AIP is expected to fuel the company’s revenue growth and profitability.
Palantir has already raised its fourth-quarter sales outlook to between $1.327 billion and $1.331 billion. For the full fiscal year, the revenue guidance has been increased to between $4.396 billion and $4.400 billion, as mentioned on investors.palantir.com.
In the third quarter, Palantir’s revenues were $1.18 billion, up 63% year over year and 18% sequentially. U.S. commercial segment revenues were $397 million for the quarter, up 121% year over year and 29% quarter over quarter. Government revenues came in at $486 million, up 52% from last year and 14% from last quarter.
Thus, the rise in U.S. commercial clientele indicated future growth potential, and an increase in government contracts strengthened barriers to entry. Banking on this optimism, Palantir’s projected earnings growth rate for the next year is a promising 42.5%.
AI Hardware and GPU Demand Boost NVIDIA’s Growth
NVIDIA’s competitive advantage in the AI hardware market, coupled with consistent demand for its CUDA software platform, is expected to drive growth. The recent green signal from the Trump administration allowing NVIDIA to ship H200 AI chips to “approved customers” in China is likely to boost growth.
Additionally, NVIDIA is well-positioned to sell its popular computing hardware, as global data center capital expenditures are projected to reach $3 trillion to $4 trillion annually by 2030, according to the company.
Meanwhile, incessant demand for NVIDIA’s innovative Blackwell chips and cloud graphics processing units (GPUs) has boosted its fiscal third-quarter 2026 revenues to $57 billion, up 62% year over year and 22% quarter over quarter, citing investor.nvidia.com.
What’s more, the company anticipates fiscal fourth-quarter 2026 revenues to reach about $65 billion, with a margin of plus or minus 2%. Due to all these positives, NVIDIA’s expected earnings growth rate for next year is an encouraging 52.4% (read more: NVIDIA or BigBear.ai: Which AI Stock Has Bigger Upside in 2026?).
Currently, NVIDIA and Micron sport a Zacks Rank #1 (Strong Buy), while Palantir has a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks Rank #1 stocks here.
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Micron Technology, Inc. (MU): Free Stock Analysis Report NVIDIA Corporation (NVDA): Free Stock Analysis Report Palantir Technologies Inc. (PLTR): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).
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