Do you have $3,000? 2 Artificial Intelligence (AI) Stocks to Buy and Hold for the Long Term

ahsan65@gmail.comNovember 14, 2025

0 1 4 minutes read

Do you have ,000? 2 Artificial Intelligence (AI) Stocks to Buy and Hold for the Long Term

Analysts expect AMD’s free cash flow to increase significantly, which could generate substantial returns for investors.
Microsoft’s cloud business is experiencing strong growth driven by increasing demand for AI services.
10 stocks we like better than Advanced Micro Devices ›

As artificial intelligence (AI) becomes more widely adopted, big players in semiconductors and cloud computing are generating significant gains for investors. Recent results from leading technology companies suggest that this is the start of a long-term development of AI infrastructure.

The total potential AI market could be worth $40 trillion, according to Morgan Stanley. If you have $3,000 you can commit to a long-term investment strategy, here are two AI stocks to buy and hold.

Image source: Getty Images.

Advanced microdevices (NASDAQ:AMD) has been competing in the chip industry for decades, but CEO Lisa Su, who took over in 2014, has positioned the company for incredible growth in the years to come. AMD’s consumer PC chips, such as its Ryzen processors, have given Intel competition has been tough in recent years, and the company now looks set to make a splash in the AI data center market.

AMD is coming off another strong quarter with record quarterly revenue and profitability. Its data center and consumer PC businesses are gaining momentum, contributing to a 36% year-over-year increase in revenue in the third quarter.

AMD is responding to the demand for cost-effective alternatives in the AI chip market. Its competitive advantage was recently validated by a multi-year agreement to supply chips for OpenAI. This allows AMD to significantly increase its revenues in the coming years. Analysts expect its revenue to reach $57 billion in 2027, up from $32 billion over the last 12 months.

The company’s third-quarter earnings report also showed a notable increase in free cash flow as increased data center chip sales lead to higher margins. Trailing 12-month free cash flow tripled year-over-year to $5.4 billion.

Analysts expect AMD’s free cash flow to grow at an annualized rate of 54%. This would increase its annual free cash flow from $2.4 billion in 2024 to over $22 billion by 2029. With such an upcoming opportunity to grow its data center business, AMD makes a great long-term investment.

Image source: Getty Images.

Many companies are still in the early stages of migrating their data to cloud services for use with AI, and this continues to fuel MicrosoftIt is (NASDAQ:MSFT) growth.

The stock’s recent decline following the release of its quarterly results in October represents an excellent buying opportunity. The company’s momentum remains robust, with revenue up 18% year-on-year to $78 billion. Cloud revenue grew 26% year over year to $49 billion, reflecting strong demand for cloud offerings for productivity and business products.

Microsoft offers many solutions to individuals and businesses on its enterprise cloud platform Azure, Dynamics 365, Office, etc. This gives Microsoft several ways to monetize the AI features that customers are increasingly using in these services.

Microsoft’s cloud business benefits from its large fleet of AI data centers. It is striking multibillion-dollar deals to expand capacity and meet insatiable demand. Its Azure cloud business saw a 40% year-over-year increase in revenue last quarter. Large companies choose Azure. These include Ralph Laurenwhich uses Microsoft’s AI tools to create a personalized shopping assistant in its app.

These results show that investors would do well to stick with this software leader as the AI boom rages on. Usage of Copilot chat in Microsoft 365 increased 50% in the fiscal first quarter compared to the previous quarter.

Large technology companies like Microsoft are best positioned to capitalize on the demand for AI. Microsoft generated $78 billion in free cash flow over the last year, and analysts expect that figure to reach $206 billion by fiscal 2030. This provides sufficient resources to invest in AI infrastructure and services to meet growing demand. Free cash flow growth is the key signal indicating strong returns for Microsoft investors.

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John Ballard holds positions in Advanced Micro Devices. The Motley Fool ranks and recommends Advanced Micro Devices and Microsoft. The Motley Fool 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.

Do you have $3,000? 2 Artificial Intelligence (AI) Stocks to Buy and Hold for the Long Term was originally published by The Motley Fool

ahsan65@gmail.comNovember 14, 2025

0 1 4 minutes read