2 Best AI Stocks That Aren't Nvidia

Despite many rising tech players increasing their stakes in the artificial intelligence (AI) game, Nvidia's (NVDA) position remains unmatched. Nvidia’s high-powered GPUs are powering almost every industry. 

Nonetheless, many underappreciated smaller players have the potential to thrive as the AI era progresses. These companies have strong AI capabilities and show great growth potential.  If you missed out on Nvidia, investing in these stocks can also provide opportunities to benefit from the AI boom.

#1. UiPath

Valued at $7.1 billion, UiPath (PATH) is an enterprise and AI automation software company. It is well-known for its robotic process automation (RPA) software platform, which automates repetitive tasks across multiple industries. Recently, Gartner announced in the 2024 Magic Quadrant for RPA that UiPath held the top place for the sixth year in a row.       

Despite a strong start to fiscal 2025, the stock is down 49% year-to-date, compared to the S&P 500 Index’s ($SPX)gain of 18%. 

UiPath's platform includes automation, AI, and machine learning (ML) tools that are well-known for their simplicity, scalability, and ability to integrate with a wide range of systems. The growing demand for automation solutions across industries has fueled UiPath's growth. 

The company's revenue model, which is primarily subscription-based, generates a predictable and stable income stream. In the first quarter of fiscal 2025, annual recurring revenue (ARR) increased by 21% year on year (YoY) to $1.5 billion.

Total revenue of $335 million increased by 16% YoY, exceeding the consensus estimate by $2.1 million. After reporting a GAAP (generally accepted accounting principles) profit of $0.06 per share in the fourth quarter, UiPath reported a net loss of $0.05 in the first quarter, which is probably why the stock took a hit.

The company has integrated generative AI into its platform. Furthermore, it has launched an AI-powered UiPath Autopilot for developers and testers. The company has partnerships with Alphabet (GOOGL) and Microsoft (MSFT), allowing customers to use UiPath's AI-powered business automation platform in the Google Cloud and Microsoft Azure. 

At the end of Q1, PATH had $1.9 billion in cash, cash equivalents, and marketable securities. It also had an adjusted free cash flow balance of $101 million. 

Management expects fiscal 2025 ARR to range between $1.660 billion and $1.665 billion. Analysts expect UiPath's revenue and earnings to increase by 7.6% in fiscal 2025 and 11.8% in fiscal 2026. The consensus calls for a profit of $0.38 per share in fiscal 2025, with earnings increasing by 16% in fiscal 2026.

The global RPA market has expanded significantly as organizations increasingly use automation to increase efficiency, lower costs, and improve accuracy in various business processes. It is expected to grow at a compounded rate of 39.9% by 2030.

With UiPath dominating the market, it is poised to gain an advantage in the coming years. However, as with many high-growth technology companies, UiPath's ability to balance growth and profitability in the face of increasing competition will demonstrate its viability as a long-term investment. 

Trading around five times forward 2025 sales, PATH appears to be a reasonable AI robotic stock to invest in now.

On Wall Street, UiPath stock is rated a “hold.” Of the 19 analysts that cover the stock, two rate it a “strong buy,” one suggests a “moderate buy,” and 16 rate it a “hold.” Based on the average target price of $16.12, the stock has an upside potential of 27.1% from current levels. Its Street-high estimate of $30 further implies the stock can go as high as 136.7% in the next 12 months. 

#2. Arista Networks

Arista Networks (ANET), valued at $111.3 billion, is a leading provider of cloud networking solutions for large AI data center, campus, and routing environments. The company's portfolio includes a diverse range of hardware and software products, such as switches, routers, and network management software, all designed to meet the high-speed, rapid demands of cloud computing environments.

Arista’s stock is up 46.3% YTD, outperforming compared to the broader market. 

In the second quarter, total revenue increased by 15.9% YoY to $1.69 billion. Plus, adjusted net income of $2.10 also grew by 32.9% YoY, which surpassed consensus estimates.

In June, the company unveiled the Arista Etherlink AI platforms, which will provide “optimal network performance for the most demanding AI workloads, including training and inferencing.” More recently, the company announced a collaboration with Nvidia to align AI networking and AI computing infrastructure. 

Arista's strong balance sheet, which is marked by significant cash reserves, gives the company the financial flexibility to pursue AI growth opportunities. It ended the quarter with $6.2 billion in cash, cash equivalents, and marketable securities.

The company did not provide full-year guidance, but it expects 14% to 16% YoY revenue growth in the third quarter. Analysts covering the stock predict that Arista's revenue and earnings will rise by 16.2% and 18.7%, respectively, for the full fiscal year 2024. Furthermore, revenue and earnings are expected to grow by 17.2% and 13.7% in 2025, respectively. 

ANET is expensive, trading at 37 times forward earnings for 2025. However, the company's revenue is closely tied to the growth of cloud computing and data center expansion, putting it in a good position to capitalize on these long-term trends. 

On Wall Street, Arista stock is a “moderate buy.” Of the 23 analysts that cover the stock, 15 rate it a “strong buy,” two suggest a “moderate buy,” five rate it a “hold,” and one rates it a “strong sell.” ANET is trading close to its average target price of $356.65, but its Street-high estimate of $432 implies the stock can go as high as 24.5% in the next 12 months.