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Wedbush analyst Dan Ives is a well-known name in the investing industry. He has been a tech analyst for over two decades and made tech sector calls that have generated significant returns in the past. He continues to make prescient calls in 2025.  With major tech companies announcing millions in capital expenditure for AI, I am bullish on tech stocks this year. The AI revolution is here, and it is going to change the way we live.

Ives shared his opinion about the AI market, and he considers it the biggest tech transformation in four decades. Whether you believe it or not, AI will continue to make money for tech giants. Investment opportunities like this do not come often, and if you miss out on this opportunity, you could end up regretting your decision. Here are three AI stocks Dan thinks will hit new highs this year.

The first pick is an obvious choice:  (Nasdaq: NVDA). The tech giant is a Magnificent Seven stock that has enjoyed an impressive rally over the past two years. Nvidia was already a solid industry player known for its gold standard in graphics processing units. However, it started developing AI chips, which are now in demand across the world. The company is the biggest beneficiary of the AI boom, and it has seen the stock price surge over 500% in the past three years.

To stay ahead of the competition, Nvidia is investing in research and development and is opening a new research center in Boston. This is aimed at improving the quantum computing segment. The company has also played a significant role in the advancement of AI in Saudi Arabia. Nvidia will provide 18,000 advanced semiconductors to Humain, an AI startup. These Blackwell chips are the newest and the most powerful from the company. Ives considers the U.S. chip deal with Saudi Arabia a “Watershed” moment in AI, which can give the Middle East a strong advantage over China.

Additionally, Cadence, a supercomputer technology provider, has also shown interest in Blackwell chips for the Millennium M2000 Supercomputer. Earlier, Nvidia’s GPUs were considered ideal for gaming, and the company used to generate the majority of its revenue from the gaming segment. But today, there is no predicting how far Nvidia can go. Its data center business is generating maximum revenue, and the company has beaten expectations over the past quarters.

Exchanging hands for $134, NVDA stock is up 38% in a month, and I believe the rally will continue as the company prepares to announce results later this month.

Next on the list of Ives’ top picks is the hot tech stock (Nasdaq: PLTR). A leader in the AI space, Palantir has gained a prominent market share in the field of data analysis. The company is a government favorite and was once criticized for only focusing on government contracts, but it has changed the narrative. Today, Palantir is a leader in the commercial space as well. It saw a 71% year-over-year jump in commercial revenue and a 45% year-over-year jump in government revenue.

Its top product, Artificial Intelligence Platform or AIP, is available on a subscription basis, and this product has brought several clients in the past two years. Some of its prominent customers include the Department of Agriculture and the US Department of Defense. In the first quarter, the company closed 31 deals with clients for $10 million and 51 deals with clients for $5 million.

Like Nvidia, Palantir stock has seen a rally, and its stock is up 490% in 12 months and over 1,200% in five years. Exchanging hands for $125, PLTR stock has jumped 67% in 2025. Earlier this year, several tech stocks were down due to the uncertainty surrounding the tariffs, but Palantir stood strong. The rally was also driven by strong quarterly results. In the first quarter, it reported a revenue of $883 million, up 39% year over year, and an EPS of 13 cents.

The pullback on tariffs has given a boost to Palantir stock, and it is leading the way. The tech giant has recently announced a deal with Divergent to transform on-demand advanced manufacturing. Additionally, it had announced partnerships with xAI, TWG Global, and Legion Intelligence earlier this month. Palantir is a very strong industry player and one of the best AI stocks to own.

Dan Ives is bullish on (NASDAQ:MSFT). Currently the second most valuable company in the world with a market cap of $3.39 trillion, Microsoft is a tech dinosaur and enjoys market dominance. It has built the Windows operating system, which remains one of the most popular productivity tools in the world. Microsoft made timely moves into cloud computing and AI. Its investment in OpenAI in 2019 is already paying off.

Microsoft’s Azure cloud platform generates a large part of the revenue, and the Copilot, an online AI assistant, has become one of the popular AI tools integrated into the Windows packages. Azure is offered as a subscription to users across the globe.

In the recent quarter, Microsoft reported a revenue of $70.1 billion, up 13% year over year, and an EPS of $3.46 per share. Its Intelligent Cloud segment generated a revenue of $26.8 billion, up 21% year over year. I believe Microsoft’s cloud computing will remain a leader for the near future. It has multiple catalysts working for it. Once is the growing AI workload, and the other is the global migration towards the cloud. I think there is ample scope for expansion in this sector, and the industry is still in the developing stage.

Trading for $455.94, the stock is up 8.9% in 2025 and 6.27% in 12 months. It has a modest dividend yield of 0.73%. Whether you look at Microsoft as a renowned tech giant or solely as an AI play, you will not be disappointed. Microsoft is a leader in the AI revolution, and it is going to keep expanding its offerings.

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