Tech Stocks Struggle in 2025: Investment Opportunities Arise

Wall Street is optimistic about big tech in 2025, yet most technology stocks have faced significant challenges in the year’s first four months. As of this writing, the Nasdaq-100—which includes the 100 largest non-financial companies on the Nasdaq exchange—has dropped nearly 7% year-to-date.

Market corrections can be unsettling, but history shows these times often provide excellent wealth-building opportunities for long-term investors. Presently, investors have a unique chance to purchase shares from several leading artificial intelligence (AI) companies at substantial discounts relative to their long-term potential.

Three Nasdaq-listed tech giants offer attractive buying prospects following a tough start to 2025.

Image source: Getty Images.

Nvidia: The AI Infrastructure Leader

With shares down an impressive 19% year-to-date, Nvidia (NASDAQ: NVDA) stands out as an exceptional buying opportunity amid the broader tech sell-off. This decline contrasts sharply with Nvidia’s strengthening role as the key hardware provider powering major AI advancements.

Nvidia’s specialized graphics processing units (GPUs) have become crucial to AI development, establishing a competitive edge that rivals struggle to match. Its influence extends into the emerging domain of physical AI, particularly through its Jetson platform, which enables sophisticated robotics applications.

This technological leadership has resulted in stellar financial performance. Annual revenue surged 383% over the last three years, reflecting the company’s robust growth.

NVDA Revenue (Annual) data by YCharts

Investors looking beyond current volatility may find Nvidia’s recent sell-off a prime opportunity to invest. The company is poised to benefit significantly from the ongoing tech transformation, which presents a multi-trillion-dollar commercial prospect over the coming decades.

Palantir Technologies: The Data Integration Innovator

While many tech stocks have struggled, Palantir Technologies (NASDAQ: PLTR) has risen an impressive 52% year-to-date, far outperforming its tech peers. This growth emphasizes Palantir’s unique standing at the intersection of data analytics, AI, and mission-critical operations.

Palantir’s software platforms, including Gotham, Foundry, and the AIP (Artificial Intelligence Platform), allow organizations to integrate vast datasets and implement AI capabilities effectively. The company’s strength lies in transforming raw data into actionable insights through advanced AI analysis.

Furthermore, Palantir has developed solid partnerships with government and defense agencies worldwide, providing a stable revenue base, while its commercial sector has seen considerable growth as enterprises increasingly value its AI tools.

With its government ties and expanding commercial reach, Palantir represents a compelling investment opportunity in the AI space, particularly for investors focused on software and implementation, even after its price rise.

ASML Holding: The Essential Equipment Supplier

ASML Holding (NASDAQ: ASML) has seen a 5.2% decline year-to-date amidst market volatility. However, this drop does not reflect ASML’s vital role in AI as the sole manufacturer of extreme ultraviolet (EUV) lithography machines, crucial for producing advanced semiconductor chips.

ASML’s monopoly on this key equipment makes it uniquely positioned to benefit from the increasing demand for chips that support AI applications. Although short-term concerns regarding quarterly orders have affected the stock, long-term demand indicators remain extremely positive.

Leading chipmakers, like Taiwan Semiconductor Manufacturing Company and SK Hynix, are ramping up their capital expenditures significantly in response to soaring demand for AI-capable semiconductors, with TSMC boosting its spending by 34% and SK Hynix increasing its 2025 investment by 30% to $20 billion.

Given this context, ASML’s subdued performance early in the year could present a valuable buying opportunity for investors seeking access to foundational players in the AI infrastructure landscape.

Conclusion: Seize the Investment Opportunity

For those concerned they’ve missed out on top-performing stocks, now may be the ideal moment to consider investments in these three companies. Investing in options like Nvidia, Palantir, and ASML could yield significant returns as the tech landscape evolves.

George Budwell has positions in Nvidia, Palantir Technologies, and Taiwan Semiconductor Manufacturing. The Motley Fool recommends ASML, Nvidia, Palantir Technologies, and Taiwan Semiconductor Manufacturing.

The views and opinions expressed herein are those of the author and do not necessarily reflect those of Nasdaq, Inc.