Market optimistic about AI-driven stocks like Microsoft, Amazon, and Oracle for long-term growth potential

From Nasdaq: 2025-04-23 06:00:00

In 2023 and 2024, the U.S. equity market saw significant gains due to optimism around AI. However, 2025 brings economic uncertainty, rising geopolitical tensions, and a trade war with China, with tariffs as high as 145% imposed by the Trump administration. China retaliated with tariffs and export restrictions on rare earth metals.

Microsoft has transitioned to a subscription-based model, ensuring stable revenue streams. Core segments like Productivity, Intelligent Cloud, and More Personal Computing have driven growth. With an aggressive AI strategy, Microsoft is well-positioned for the future, expecting revenue and earnings growth of 11.9% and 12.3% annually.

Amazon’s diverse ecosystem includes AWS, digital advertising, and AI initiatives. Despite trade war disruptions, AWS remains a profit powerhouse, generating over 58% of operating income. Amazon’s AI investments and e-commerce expansion show long-term growth potential. The current share price dip presents an opportunity for investors.

Oracle, though not a major AI stock pick, is poised for growth. With RPO soaring to $130 billion and rapid cloud infrastructure growth, Oracle is strategic in AI infrastructure. The company’s AI Data Platform and upcoming projects signal growth potential, with management expecting revenue growth of 15% in 2026 and 20% in 2027.

Consider the 10 best stocks to buy now, excluding Microsoft, as recommended by The Motley Fool Stock Advisor team. Their picks have historically outperformed the market, with significant returns. Join Stock Advisor for access to the latest top 10 list and potential investment opportunities. John Mackey, former CEO of Whole Foods Market, is a member of The Motley Fool’s board.



Read more at Nasdaq: 3 No-Brainer Stocks to Buy and Hold for the Next Decade