Key Points
The semiconductor company Qualcomm is stepping into the data center processing market, but its most significant growth potential lies in the space between data centers and the individuals who use them.
A computer company named Dell is utilizing its brand and presence in the corporate computing sector to simplify the process for organizations to start adopting artificial intelligence.
ServiceNow stock has declined since mid-last year, but this does not reflect on the company's worth and future prospects.
I don't necessarily feel unhappy about the artificial intelligence stocks I've included in my investment portfolio up to this point. As the saying goes, though, hindsight is 20/20. If I were selecting these stocks now, my involvement in the AI sector would likely be somewhat different. Here's what I would purchase today, based on my current knowledge and observations.
1. Qualcomm
You are most familiar with it as a producer of high-performance processing chips for mobile devices, although some investors might also be aware that it has cautiously entered the laptop market with its power-efficient AI-enabled Snapdragon processors. What most investors maynot realize, however, is that Qualcomm (NASDAQ: QCOM)is currently stepping into the artificial intelligence data center processing industry.
Although it's not close to topplingNvidia In this regard, in October, the company introduced its AI200 and AI250 chip-based accelerator cards designed for AI inference. And just last month, it announced that it has at least one hyperscaler customer. Additional clients are likely being developed, as the industry is seeking greater availability at reduced costs and more efficient operations.
That being said, perhaps the main reason Qualcomm is sounderestimated AI investment opportunitythat's it's connecting individuals with distant data centers. As CEO Cristiano Amon mentioned in an interview with theWall Street Journalearlier this year, "the biggest opportunity [of 2026] lies on the edge." The "edge" refers to wearables, smart meters, connected vehicles, medical monitoring devices, and even autonomous robotics – technologies that don't necessarily require intensive computing, buttechnologythat must be able to perform certain logical tasks without continuous supervision.
The fact is, Amon is entirely correct. A report from Precedence Research forecasts that the global edge AI market will experience an average annual growth rate of over 20% by 2035. Qualcomm is well-placed to secure a significant portion of this expansion.
2. Dell
You're reading that right. Dell (NYSE: DELL), most recognized for producing computers, is also involved in the artificial intelligence industry.
It's clearly not nearly as famous asBroadcomor Nvidia. Nvidia specializes exclusively in high-performance processors, whereas Broadcom focuses solely on networking solutions. Both companies still require a platform to integrate their technology, and these connection points must be capable of being physically linked within a data center. This is where Dell AI Factory comes into play. This operational divisionassists businesses in setting up the physical structurehad to start using artificial intelligence.
It's still not a major revenue source for the company — at least not yet. Out of the total revenue of $33.4 billion from the last quarter, only $9 billion came from AI-optimized server sales. However, this segment is expanding rapidly, with significant future business already secured. As COO Jeff Clark mentioned in the February full-year review, "we secured over $64 billion in AI-optimized server orders, shipped more than $25 billion during the year, and are starting FY27 with a record backlog of $43 billion — strong evidence that our engineering expertise and unique AI solutions are succeeding."
Dell's stock has increased by 100% since the late-February release of these figures — a surge that could make some potential investors hesitate. However, don't become too cautious or hold out for a significant drop. You might not see it. Dell shares are still valued at roughly 22 times this year's estimated earnings per share of $12.97. This is more affordable than many other artificial intelligence stocks.
3. ServiceNow
Finally, I'm addingServiceNow (NYSE: NOW) to my list of artificial intelligence stocksI would purchase it today if I were beginning from the ground up.
ServiceNow provides various workflow solutions. This essentially means its software enables employees to design their own computer automation scripts to manage repetitive, labor-intensive tasks, allowing them to focus more on complex work that requires higher-level thinking.can'tcan be automated. It has been in existence since 2003, long before artificial intelligence, as we know it today, became widespread and accessible. The rise of AI, naturally, has significantly enhanced the company's technological advancements.
Artificial intelligence has also brought competitors into the picture, including names such asWorkday and UiPath. ServiceNow holds a debatable advantage over all these current and potential competitors, however. This is due to its longevity and the market's established recognition of the brand along with confidence in its offerings. A technology research and consulting firm GartnerServiceNow is consistently ranked as one of the top names in the AI applications and IT service management industry, with last quarter's performance reinforcing this positive outlook. Revenue increased by 19% year over year on a constant-currency basis, and operating income rose by 11%. Indeed, ServiceNow is profitable and has maintained profitability consistently.
This robust financial success has not stopped ServiceNow's stock frommore than halving since its Julypeak. However, this weakness is more related to general worries about the valuations of AI stocks that occurred around that time; this stock's impressive rise during 2023 and 2024 also made it susceptible to selling pressure.
Most, if not all, of this weakness appears to have passed, however. Analysts seem to believe that as well. The majority of them currently rate this stock as a strong buy, with a consensus price target of $140.63, which is 40% higher than the current price of the stock.
Is it a good time to purchase shares in Qualcomm?
Prior to purchasing shares in Qualcomm, take note of this:
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James Brumleydoes not hold any positions in the stocks listed. The Motley Fool holds positions in and suggests Broadcom, Nvidia, Qualcomm, ServiceNow, UiPath, and Workday. The Motley Fool recommends Gartner. The Motley Fool has adisclosure policy.
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