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AI Stocks in 2025: Palantir & Nvidia Performance (What Investors Should Know)

Palantir up 110% and Nvidia up 29% in 2025. Learn about AI stock investing, risk management approaches, and artificial intelligence market trends. Educational guide with data and charts.

Sean Sha
By Sean Sha(updated )7 min read

Educational purposes only. This content does not constitute investment advice. Read our disclaimer

StockCram is not a broker-dealer, investment adviser, or financial institution. All content is for educational and informational purposes only and should not be construed as personalized investment advice. Consult a qualified financial professional before making investment decisions. Past performance does not guarantee future results.
AI Stocks in 2025: Palantir & Nvidia Performance (What Investors Should Know)
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7 min read

Note, updated August 2026: The prices and returns below are a snapshot of the twelve months through mid-2025, kept for historical context. They are not current. Markets have moved substantially since, and both Palantir and Nvidia trade at very different levels today. For the current debate, see Are We in Another AI Bubble?. Historical data shown; past performance does not indicate future results. Artificial intelligence stocks have been among the most discussed in 2025. Palantir up 110% and Nvidia up 29% year-to-date - both outpacing the broader S&P 500's +7% return.

With AI stocks drawing significant attention, investors may want to understand the landscape before making decisions. This educational guide examines the factors behind AI stock performance and risk considerations.

Learn from real performance data, understand why Palantir rose 110% while Nvidia gained a steady 29%, and explore common approaches to AI stock investing - including risk management concepts that beginners should understand.

2025 YTD AI Stock Scorecard

Update (August 24, 2026): The performance data below covers the twelve months through July 2025 and is kept for historical context. Since then, markets have moved substantially. As of August 2026, Palantir trades around $174-180 (versus $154 in July 2025), Nvidia around $209-215 (versus $174), and the S&P 500 near 7,674 (versus 6,238). The AI market has also grown faster than initially projected, with 2026 estimates ranging from $514 billion to $750 billion depending on methodology. For current market analysis, see Are We in Another AI Bubble?.

The numbers tell the story of 2025: AI stocks led the market that year. Here's how the leaders stacked up through August 1st, 2025.

AI Stock Performance vs Market (YTD 2025)

Complete performance breakdown of leading AI stock performance in 2025. Historical data shown; past performance does not indicate future results.

PriceStockHigh 2025Market CapYtd Return
$154.27Palantir (PLTR)$160.39$364B+110%
$173.72Nvidia (NVDA)$187.45$4.24T+29%
6,238S&P 500 (^GSPC)6,444N/A+6.9%
PLTR vs NVDA: Side-by-Side Performance Comparison

Monthly price progression comparing Palantir and Nvidia through August 2025. Historical data; past performance does not indicate future results.

MonthNvda PricePltr PriceNvda ChangePltr Change
Aug '24$134.50$73.40N/AN/A
Sep '24$132.80$76.80-1.3%+4.6%
Oct '24$138.20$82.10+4.1%+6.9%
Nov '24$142.10$89.50+2.8%+9.0%
Dec '24$145.60$95.20+2.5%+6.4%
Jan '25$141.30$108.70-3.0%+14.2%
Feb '25$148.70$125.30+5.2%+15.3%
Mar '25$158.90$138.90+6.9%+10.9%
Apr '25$162.40$145.20+2.2%+4.5%
May '25$168.20$149.80+3.6%+3.2%
Jun '25$171.50$152.60+2.0%+1.9%
Jul '25$173.72$154.27+1.3%+1.1%
12-Mo Total+29.2%+110.1%N/AN/A

Palantir: What Drove the 2025 Rally

What's driving the rally? Big U.S. Army enterprise contract: a 10-year deal worth up to $10 billion, replacing 75 smaller contracts. Commercial revenue growth from private firms rapidly adopting Palantir's AI Platform (AIP), now outgrowing government revenue.

  • ✓Big U.S. Army enterprise contract: a 10-year deal worth up to $10 billion, replacing 75 smaller contracts
  • ✓Commercial revenue growth: private firms rapidly adopting Palantir's AI Platform (AIP), now outgrowing government revenue
  • ✓AIP enables 'bring-your-own-LLM': companies plug GPT-style models into their data without sending everything to public clouds
  • ✓Earnings (Aug 4, 2025): analysts expected 54% EPS growth and 38% revenue growth year-over-year
  • ✓Valuation: in mid-2025, at about $154, PLTR traded near 19× forward sales and 75× forward earnings, which was high, so growth had to stay hot
  • ✓Market cap: about $364 billion in mid-2025, making it a mega-cap defense technology stock

Nvidia: The GPU Maker Powering Every AI Model

Why the chip giant led in 2025: its GPU moat, with H200 and Blackwell chips, remained the gold standard for AI training and inference. Software lock-in through the CUDA + DGX Cloud ecosystem created sticky customer relationships.

  • ✓GPU moat: H200 and Blackwell chips remain the gold standard for AI training and inference
  • ✓Software lock-in: CUDA + DGX Cloud ecosystem creates sticky customer relationships
  • ✓Market dominance: controlled an estimated 92% of data center AI chips in 2025
  • ✓Diversification: networking (Spectrum-X), automotive AI, and edge computing create new revenue streams
  • ✓+29% in 2025 vs. +7% for the S&P 500 index
  • ✓Has averaged ~40% total return per year over two decades
  • ✓Traded at 55× trailing P/E in 2025, with strong earnings growth expected
  • ✓Revenue projected to reach $111.3 billion in 2025, up from $26.97 billion in 2023

The AI Market Boom: $235B to $631B by 2028

According to International Data Corporation, the global artificial intelligence market is projected to grow from $235 billion in 2024 to more than $631 billion by 2028. Projections are not guarantees, and actual results may vary.

  • ✓AI companies raised $52B in Q1 2025 alone
  • ✓McKinsey predicts $5.2 trillion in AI infrastructure investments by 2030
  • ✓88% of companies report plans to increase AI spending in 2025

Key Risk Concepts to Understand

Before considering any investment in AI stocks, it is important to understand the risks involved. Here are key concepts every investor should know.

  • ✓Concentration risk: Single sectors or themes can underperform for long periods
  • ✓Volatility: High-growth stocks historically experience significant price swings
  • ✓Valuation risk: Strong narratives and past performance do not guarantee future returns
  • ✓Time horizon: Consider how long you can hold through potential downturns
AI Stock Risk Factors

Educational overview of risks associated with AI sector investing

Risk TypeDescriptionConsideration
Concentration RiskSingle themes can underperform for extended periodsDiversification across sectors matters
Volatility RiskHigh-growth stocks can swing 20-50% in correctionsPast performance does not predict future results
Valuation RiskStrong narratives do not guarantee returnsHigh P/E ratios indicate elevated expectations
Competition RiskTech leadership can shift quicklyMonitor industry dynamics over time

Frequently Asked Questions (Beginner-Friendly)

Common questions about AI stock investing with beginner-friendly answers.

Key Takeaways

•

Palantir (+110% YTD) and Nvidia (+29% YTD) have led AI stocks in 2025

Both stocks have outpaced the S&P 500 +7% return through mid-2025, though past performance does not guarantee future results

•

High valuations carry elevated risk

Strong performance has pushed valuations higher, meaning expectations are elevated and disappointments can lead to sharp corrections

•

Understanding risk factors is essential before investing

Concentration risk, volatility, valuation, and competition are all factors to consider when evaluating any investment

•

The AI market is projected to grow significantly through 2028

Industry projections suggest continued growth, though projections are not guarantees and actual results may vary

Next Steps

1

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3

Following market analysis

Educational context on market trends and the AI sector

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Additional Resources

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How call and put options work

Portfolio Protection Strategies

How investors approach portfolio risk during market volatility

Latest Market Analysis

Stay updated with current market trends and opportunities

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