The tech industry has built a reputation for consistent and significant growth over the long term. So, it's no surprise that four of the top five most valuable companies in the world are involved in tech, including Microsoft(NASDAQ: MSFT), Apple, Nvidia(NASDAQ: NVDA), and Alphabet.
The success of these companies is evident by the Nasdaq-100 Technology Sector's 419% rise over the last decade, significantly outperforming the S&P 500's growth of 179% during the same period.
The tech industry has made many millionaires over the years and likely isn't done yet. Rapidly expanding markets like artificial intelligence (AI), autonomous vehicles, virtual reality, cloud computing, and more have massive potential in the coming years. Many are nowhere near hitting their ceilings and could have much to offer new investors over the long term.
Here are two millionaire-maker technology stocks to watch.
1. Nvidia
Whether you trade professionally or take a more casual approach to the stock market, you're likely aware of Nvidia's meteoric rise over the last year. Since last May, the company's stock price has increased by 173% alongside soaring earnings.
Nvidia posted its results for the first quarter of fiscal 2025 (ending April 2024) on May 22, once again blowing Wall Street estimates out of the water. During the quarter, the chipmaker's revenue rose 262% year over year, beating expectations by more than $1 billion. Non-GAAP (adjusted) earnings per share reached $6.12, $0.54 over analysts' projections.
Q1 2025 saw Nvidia continue to benefit from its dominating role in AI. Its data center segment enjoyed revenue growth of 427%, illustrating a significant jump in AI chip sales.
However, it's crucial to remember that Nvidia is much more than AI. As a leading chipmaker, the company profits from the tailwinds of industries across tech. For example, Nvidia's gaming division includes income from chips sold to consumers, who use the company's hardware to power custom-built gaming PCs. The segment also profits from Nvidia's role as the exclusive supplier of chips to Nintendo's Switch video game console, which has sold 141 million units to date.
Gaming revenue rose 18% year over year to nearly $3 billion in Q1 2025.
Moreover, Nvidia's hardware is powering Tesla's range of electric and increasingly autonomous vehicles. The chips are crucial to Tesla's self-driving technology, an industry where chip demand is only likely to continue rising for the foreseeable future. Comments from Nvidia CFO Colette Kress support Nvidia's significant potential in the field as she expects automotive to be the "largest enterprise vertical within [the] Data Center [segment] this year."
Despite Nvidia's soaring stock price over the last year, it remains an attractive investment. The company's price/earnings-to-growth (PEG) ratio has plunged to less than 1, making it an excellent value and a screaming buy right now.
2. Microsoft
Like Nvidia, Microsoft has garnered much attention from Wall Street over the last year. The company was an early investor in AI, investing $1 billion in ChatGPT developer OpenAI in 2019. The head start has granted Microsoft exclusive access to some of the most advanced AI models in the industry, allowing it to integrate the technology across its product lineup.
Since the start of 2023, Microsoft has added AI features to its Office productivity suite, improved its Bing search engine with elements of ChatGPT, and bolstered its cloud platform, Azure, by expanding its library of AI services. Most recently, the company announced a new line of computers it calls Copilot+ PCs, which are equipped with special neural processing units (NPUs) to run various AI tasks more efficiently.
The move could make Microsoft more competitive against Apple, which also has its own line of AI PCs in the works. Microsoft's head start could play to its advantage in the computing space as Apple works to catch up in AI.
Microsoft posted its earnings results for the fiscal third quarter of 2024 last month. Revenue rose 17% year over year and beat forecasts by more than $1 billion. The company's AI efforts appeared to boost multiple areas of its business, with revenue in its productivity and business processes segment rising 12% thanks to increased sales for Office products. Meanwhile, Microsoft's intelligent cloud division delivered 21% revenue growth.
Shares in Microsoft have soared nearly 1,000% in the last 10 years, no doubt creating more than a few millionaires along the way. Yet, the rise of AI suggests plenty of room left to run for the tech giant. Its PEG ratio of 1.5 suggests its shares are slightly overvalued.
However, Microsoft's position as the world's most valuable company, alongside massive cash reserves, makes its stock worth its high valuation and one that could make you a millionaire with the right investment.
Should you invest $1,000 in Nvidia right now?
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Suzanne Frey, an executive at Alphabet, is a member of The Motley Fool's board of directors. Dani Cook has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Alphabet, Apple, Microsoft, Nvidia, and Tesla. The Motley Fool recommends Nintendo and recommends the following options: long January 2026 $395 calls on Microsoft and short January 2026 $405 calls on Microsoft. The Motley Fool has a disclosure policy.
