The year 2025 could be one of artificial intelligence (AI) and crypto stocks. Companies that have harnessed this growth potential could see a boost in demand as lower interest rates and economic recovery drive technology spending by companies and customers. The AI boom Nvidia saw was the experimental phase where companies developed and tested AI potential. Now, investors are asking for returns on their AI investments.
The growth in AI
After investing more than US$10 billion in ChatGPT creator Open AI, Microsoft is focusing on artificial generic intelligence (AGI), which it defines as something that can generate US$100 billion in profits, according to Reuters. It is looking to reduce expenses and dependence on OpenAI by using both internal and external AI models for its Microsoft 365 Copilot.
With the focus shifting to making AI affordable and reducing dependence on one company, demand for alternatives will pick up.
AMD stock
Advanced Micro Devices (NASDAQ:AMD) presents a less expensive alternative to Nvidia’s data centre graphic processing unit (GPU). Moreover, its ROCm software stack for its data centre GPUs presents an alternative to Nvidia’s CUDA. Remember, AMD is not looking to compete with Nvidia’s GPUs on the performance front. It is looking to provide a cost-effective alternative to run AI modules and applications smoothly.
AMD saw growing demand for its AI GPUs. Its data centre revenue surged 122% year-over-year to US$3.5 billion in the third quarter. It also saw an uptick in client revenue as people prepare for a Personal Computers (PC) upgrade cycle with the end of support for Windows 10.
Canalys expects demand for AI-capable PCs that can run Copilot+ to face resistance in the short term but grow in the long term. These PCs are expensive because of their hardware specifications like 40 NPU TOPS (trillions of operations per second). So far, AI PCs account for 20% of PC shipments. However, an upcoming PC upgrade cycle could drive demand for AMD’s Ryzen processor and AI-enabled PC processors.
Crypto trend
Alongside AI, momentum around crypto could build up as U.S. President Donald Trump launches the $TRUMP coin and supports crypto. Behind a crypto bubble is increasing confidence in crypto as an alternative investment. While AMD GPUs can help you ride the AI revolution, they can also benefit from a crypto bubble as miners use GPUs to mine crypto.
AMD is stock has slipped more than 26% in the last 12 months and is trading at a forward price-to-earnings (PE) ratio of 24.57 times, its lowest since September 2023. An uptick in revenue could lead to an uptick in earnings and drive its stock price.
The stock could see a cyclical uptrend, wherein the stock could double in a few months. The last two uptrend cycles from October 27, 2023 to March 8, 2024, and October 2022 to May 2023 boosted the stock price by more than 110%. Note that historical data may not determine future growth potential. However, the future growth will be driven by a sharp rise in client and data centre revenue.
Hive stock
Hive Digital Technologies (TSXV:HIVE) could also benefit from,p both AI and crypto. It is giving companies access to its GPU-powered data centres to perform high-performance computing (HPC) tasks such as AI and rendering. However, the company’s Bitcoin mining business could give investors the benefit of a rise in Bitcoin prices.
The company has shifted its headquarters to Texas to make the most of the crypto growth. It is also building a data centre in Paraguay, which could increase its revenue significantly in 2025.
If a crypto bubble materializes, Hive stock could grow 700–800% in a few months.
How to invest $3,000 in these monster growth stocks
You could consider investing $2,500 in AMD as it is relatively less risky and $500 in Hive. Before selling the stock consider reviewing its growth potential by looking at the trading volume. If it is above average and the share price is trending upwards, it hints at a bullish sentiment.
