Investing in technology stocks has emerged as a proven method for accumulating wealth over the long term. The Nasdaq-100 Technology Sector index demonstrates that a $1,000 investment from a decade ago has risen in value to over $5,000, exemplifying the potential for significant returns with long-term investments in this sector.
Nvidia, a technology stock valued at nearly $1.35 million a decade ago, holds the promise of potentially making investors millionaires in the future. While not every tech stock mirrors Nvidia’s success, it is evident that including solid tech stocks within a diversified portfolio may lead to substantial growth over time.
Two such tech stocks, with promising growth prospects, are Super Micro Computer and SoundHound AI. These companies present the potential for substantial growth that can assist investors in cultivating million-dollar portfolios in the long run.
Super Micro Computer, also recognised as Supermicro, has demonstrated remarkable growth over the past year. The company is projected to conclude the current fiscal year with revenue amounting to $14.9 billion, which marks a revenue increase of more than double compared to the previous fiscal year. Moreover, Supermicro has disclosed plans to expand its production facilities to meet the escalating demand for liquid-cooled server racks, thereby positioning the company to benefit from the increasing demand for artificial intelligence (AI)-related services.
With the anticipation of a surge in demand for liquid-cooled data centres and AI servers in the forthcoming years, Super Micro Computer holds considerable growth potential. Analysts project that the company’s earnings will grow at an annual rate of over 62% for the next five years, signifying substantial growth opportunities for the company and potential upside for investors.
SoundHound AI is another company positioned for growth, particularly in the realm of voice AI solutions. The company’s revenue in the initial quarter of 2024 surged by 73% year over year, with a full-year revenue projection of $71 million, reflecting a 55% increase from the previous year. These figures illustrate robust demand for SoundHound’s voice AI platform and the company’s capability to attract customers across a wide array of industries.
SoundHound’s affiliations with quick-service restaurants and automotive companies, alongside its expanding customer base, point to the potential for steady growth. The company’s cumulative subscriptions and bookings backlog escalated by 80% year over year, reaching $682 million, a strong indicator of potential future revenue. Analysts forecast a 47% revenue increase for SoundHound in 2025, amounting to $103.6 million, signalling the company’s likelihood to outpace the market and maintain its robust growth.
Both Super Micro Computer and SoundHound AI present solid growth potential and the capacity to add significant value to investment portfolios. For investors seeking to capitalise on the tech sector’s growth and potentially develop million-dollar portfolios, these two stocks merit serious consideration.
In summary, investing in robust technology stocks offers the prospect of substantial returns over time. By making prudent selections of companies with strong growth potential, such as Super Micro Computer and SoundHound AI, investors can leverage the opportunity to amass wealth and establish million-dollar portfolios in the long term.