As 2024 enters its final stretch, investors are reaping the rewards of a remarkable year, with the S&P 500 index soaring nearly 21%. The artificial intelligence (AI) revolution, which dominated 2023, continues to propel the market forward. With AI adoption on the rise, savvy investors should consider snapping up AI-focused stocks ahead of 2025. Two compelling options are CrowdStrike and Spotify Technology.
CrowdStrike, a cybersecurity leader, faced a setback in July when a software update crashed over 8.5 million customer computers, causing a 36% stock plunge. However, CEO George Kurtz’s recent comments suggest the fallout may be less severe than expected. CrowdStrike’s Falcon platform offers a comprehensive security solution, leveraging AI to power automated threat hunting and incident response. Its AI models, trained on over 2 trillion security events daily, continually improve. The company’s virtual assistant, Charlotte AI, saves users an estimated two hours per day.
With 65% of customers using at least five of the 28 available cybersecurity modules, CrowdStrike’s revenue potential is substantial. The company aims to reach $10 billion in annual recurring revenue over the next seven years. Despite the recent outage, CrowdStrike stock has rebounded, and with it still trading 23% below its all-time high, now may be an opportune time to invest.
Spotify, the world’s largest music streaming platform, boasts a 31.7% market share. The company has long utilized AI-powered algorithms in its recommendation engine and has recently introduced innovative features, such as AI DJ, which creates personalized playlists, and AI Playlist, which generates unique tracks based on user prompts. Spotify is also experimenting with AI in its advertising platform, including the Quick Audio tool, which streamlines ad creation.
With 626 million monthly active users, Spotify is on track to generate $17.6 billion in revenue for 2024. The company aims to reach 1 billion users by 2030, potentially leading to $100 billion in annual revenue. As Spotify continues to innovate and grow, its stock, currently trading near its all-time high, still has upside potential.
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