The stock market may have experienced some volatility recently, but it is worth noting that the S&P500 The index has posted a whopping 41% gain since the start of 2023, thanks to a solid rally in technology stocks, which outperformed the broader market on catalysts such as artificial intelligence (AI).

This explains why the technology-laden Nasdaq-100 technology sector The index has outperformed the S&P 500 with astonishing gains of 74% since the beginning of 2023. The ability of technology companies to capitalize on disruptive trends over time, such as the internet, smartphones, video streaming, social media, and now AI, is why companies in this sector tend to generate above-average profits.

For this reason, investors should consider shares of NVIDIA (NVDA 1.40%) And SoundHound AI (SOUND 0.40%) in 2024, as both companies stand to benefit from the adoption of AI in their respective industries and could prove to be the highest growth stocks in the long run. Nvidia and SoundHound shares are already up 135% this year, and a closer look at their prospects will show us that their bull run could be here to stay.

Nvidia’s AI-powered rally likely to gain momentum

Although Nvidia has been in good form on the stock market this year, it has seen a slight decline recently. However, that could change later this month when the semiconductor giant reports its second quarter of fiscal 2025 results.

Nvidia will release its next quarterly results on August 28. Analysts forecast the company will report revenue of $28.5 billion, slightly above the chipmaker’s forecast of $28 billion. Earnings are expected to more than double, rising to $0.64 per share from $0.27 per share in the year-ago quarter.

Given its dominant position in the AI ​​chip market, it would not be a surprise if Nvidia were to once again beat Wall Street forecasts, as it has done for the past four quarters.

The company has seen tremendous demand for its artificial intelligence graphics processing units (GPUs), which are driving the growth of Nvidia’s data center business. In the first quarter of fiscal 2025 (ended April 28), Nvidia’s revenue from its data center business rose 427% year over year to $22.6 billion. Total revenue rose 262% year over year to $26 billion.

Nvidia’s terrific growth in the data center space is likely to continue into the fiscal second quarter and beyond, despite recent rumors that production of the next Blackwell chips is expected to be delayed by four to six weeks. That’s because Nvidia is seeing strong demand for its existing H100 and H200 processors.

CFO Colette Kress noted on Nvidia’s earnings call in May that the company continued to increase shipments of its previous flagship processor, the H100, despite the availability of a new chip like the H200. At the same time, Nvidia has struggled to meet demand for the H200 and expects that chip to face supply constraints next year as well.

As for the company’s next-generation Blackwell processors, sources suggest that Nvidia could generate a whopping $210 billion in revenue from their sales next year. That would be a huge increase from the $47.5 billion the company generated from data centers in fiscal 2024. All of this explains why analysts expect Nvidia’s revenue to nearly double to $120.5 billion in fiscal 2025 (which ends in January next year), from $60.9 billion in fiscal 2024.

As the following chart shows, analysts have also raised their growth expectations for Nvidia in the coming fiscal years.

NVDA revenue estimates for the current fiscal year, data from YCharts.

All of this suggests that Nvidia could remain a top growth stock in 2024 and beyond, making the company an ideal bet for growth-oriented investors looking to capitalize on the rapidly increasing adoption of AI.

SoundHound AI gains traction in a fast-growing AI niche

SoundHound AI provides clients with a platform to help them develop voice AI solutions such as chatbots and conversational voice assistants. The company believes its total addressable market (TAM) could be worth a whopping $140 billion, and the good news is that it is well on its way to capitalizing on this opportunity.

The company reported an impressive 54% year-over-year revenue jump to $13.5 million in the second quarter of 2024. SoundHound AI also acquired enterprise AI software company Amelia for $80 million to expand its reach in the generative, AI-powered customer service space. SoundHound says it will serve 200 high-profile customers around the world following the acquisition, including top banks and Fortune 500 companies.

Thanks to this acquisition and SoundHound’s growing presence in the restaurant and automotive markets, the company increased its 2024 revenue forecast to at least $80 million, up from the previous forecast of $71 million. In addition, SoundHound expects revenue to grow rapidly again in 2025, exceeding $150 million.

According to SoundHound’s 2024 revenue forecast, revenue is expected to grow 74% this year, which would be an improvement over 47% revenue growth in 2023. Even better, according to its 2025 forecast, the company expects revenue to grow 87% next year.

We’ve already seen that SoundHound sees a huge market for its voice AI solutions, so there’s a good chance the company can sustain its stellar growth over the long term. So investors looking to buy a growth stock now may consider adding SoundHound to their portfolio. The company’s shares have gained following its recent results and could continue to rise based on the company’s prospects.