The artificial intelligence industry has been filled with top-performing stocks, but none of them have kept up with Palantir (NASDAQ:PLTR). Shares have more than doubled year-to-date and are up by almost 500% over the past year.
Some investors believe Palantir can become a trillion-dollar company within the next five years, but the stock’s sky-high valuation has been scaring away some people. However, today’s winners may not be next year’s champions. These are some of the AI stocks that offer growth at reasonable valuations.
Key Points
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Palantir has crushed the stock market, but its valuation has been scaring some investors.
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These three AI stocks have more attractive valuations and higher revenue growth rates than Palantir.
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IREN Limited (IREN)
Iren Limited (
It’s one of the few crypto miners that recently reached the 50 EH/s threshold, and the company is also profitable. Revenue and net income both more than doubled year-over-year in the most recent quarter.
Although Iren makes very little money from its AI cloud segment, that can change drastically. The company’s $3.6 million in revenue from that segment represents a 33.3% sequential improvement. It also has the infrastructure in place to support more growth due to its crypto mining activities.
Although a crypto miner getting into artificial intelligence may turn off some investors, that would be a big mistake. Nvidia (NASDAQ:NVDA) first got into the spotlight as a pick-and-shovel play for crypto miners. Warnings about slower crypto sales were enough to cause Nvidia shares to drop by roughly 5% in a single day back in 2018. Nvidia CEO Jensen Huang even cited crypto’s decline as a key reason Nvidia had a “disappointing quarter” to wrap up fiscal 2019.
Iren has the resources to make a big pivot into artificial intelligence and drive significant gains for long-term investors. It sounds similar to how Coreweave (NASDAQ:CRWV) transitioned from a small crypto miner to an AI juggernaut.
TSS (TSS)
TSS (NASDAQ:TSSI) is a data center stock that has been outpacing the stock market. It’s up by roughly 80% year-to-date and has outpaced Palantir with a 734% gain over the past year. Despite this growth, TSS is still a relatively unknown AI stock that has a market cap just above $600 million.
A smaller market cap will make it easier for TSS to log future gains if it continues to post strong financials, and those numbers have been exceptional. The company reported a massive 523% year-over-year revenue boost in the first quarter. Net income surged from $15,000 in Q1 2024 to $3.0 million in this quarter.
A partnership with Dell (NYSE:DELL) has been the main catalyst for TSS’s success. It’s a bit of a double-edged sword, though, since almost all of TSS’s revenue comes from Dell. The company is working on diversifying its customer base, and its successes with Dell will make that easier.
Luckily, Dell said that they are experiencing “unprecedented demand for [its] AI-optimized servers,” which means TSS stands to benefit. TSS also recently started production in its new facility, implying that demand has grown since the first quarter. The facility was completed on May 7, 2025, so it did not show up in Q1 results. This facility’s output will show up a little in Q2 results and will be fully apparent in Q3 results.
Innodata (INOD)
Innodata (NASDAQ:INOD) organizes the data that AI generates, and it has a bunch of Magnificent Seven companies as its clients. Shares haven’t budged by much over a few months, largely due to guidance that seems like it was sandbagged.
The AI firm delivered 120% year-over-year revenue growth in the first quarter and suggested that revenue will grow by 40% in 2025. Investors were unsettled by the company announcing a relatively low growth rate after coming off a strong quarter. CEO Jack Abuhoff even mentioned that the company is expanding contracts with existing customers while attracting new customers.
The remarks don’t suggest Innodata stops at 40% year-over-year growth throughout the year. Furthermore, Meta Platforms‘ (NASDAQ:META) $14.8 billion acquisition of Scale AI is a major catalyst for Innodata. Other companies may feel uncomfortable working with a firm that Meta Platforms owns, and they may divert more of their budgets toward Innodata moving forward.
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