Two Leading AI Companies poised for Two‑Decade Growth

Key Points

Forecasting events two decades ahead is inherently uncertain. Looking back to 2006 reveals numerous unforeseen developments, from the 2008 financial crisis to the COVID‑19 pandemic and the emergence of generative AI. While the future remains unpredictable, certain broad trends can be identified for long‑term investors.

Amid the rise of artificial intelligence, a select group of companies is positioned to thrive. Firms that are actively constructing the underlying AI infrastructure are especially well‑placed to capture sustained growth.

Two firms stand out as compelling long‑term investments: Microsoft (NASDAQ: MSFT) and Amazon (NASDAQ: AMZN). Both are heavily investing in AI infrastructure, making them attractive for investors seeking prolonged growth.

Image source: Getty Images.

1. Amazon

Amazon operates a dual business model. Its retail platform remains a dominant force in e‑commerce, a trend unlikely to reverse. However, the more compelling growth driver is Amazon Web Services (AWS), which is rapidly becoming a preferred environment for AI workloads.

AWS demonstrated a 28 % year‑over‑year revenue increase in the latest quarter, the strongest performance in fifteen quarters. Its custom AI chip initiative also posted triple‑digit growth, underscoring a new avenue for expansion.

CEO Andy Jassy highlighted in the shareholder letter that Amazon plans to invest approximately $200 billion in infrastructure this year, with an expected useful life exceeding thirty years, while compute hardware typically depreciates over about five years. Successful execution of this capital program could generate substantial free‑cash‑flow growth, accelerating shareholder returns.

Given the enduring demand for AI compute, Amazon’s strategic investments suggest a strong long‑term outlook for investors willing to hold the stock for the next twenty years.

2. Microsoft

Microsoft’s core operations also benefit from AI integration. The company has embedded AI capabilities across its productivity suite, creating a $37 billion revenue stream that is growing at a 123 % rate.

Its cloud platform, Azure, continues to expand, posting a 40 % revenue rise in the most recent quarter, driven by strong AI demand.

Cloud services generate recurring, usage‑based revenue, making them resilient and scalable. Each AI workload consumes tokens during execution, ensuring a persistent income stream for both Azure and AWS.

Both companies have deep partnerships with leading AI innovators — Microsoft with OpenAI and Amazon with Anthropic — further solidifying their positions.

Regardless of which generative AI model proves superior, the underlying compute demand will continue to flow through Microsoft’s and Amazon’s servers, securing long‑term revenue growth.

As AI becomes increasingly embedded in everyday activities and enterprise workflows, these two firms are poised to reap significant benefits, reinforced by the strength of their core businesses.

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

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