Three AI Infrastructure Stocks Positioned for Decades of Data Center Growth

Key Points

• Arm projects the largest share of data center CPUs by 2030.
• IREN is scaling into a global data center powerhouse with a gigawatt-level power portfolio.
• Nvidia’s leadership continues to identify and capture emerging compute markets.

The acceleration of enterprise AI adoption has triggered a historic surge in data center investment. Morgan Stanley estimates global construction costs will approach $3 trillion through 2028. With the infrastructure build-out still in its early stages, investors have an opportunity to compound wealth alongside the companies enabling this transformation. Three standouts—Arm Holdings (NASDAQ: ARM), IREN (NASDAQ: IREN), and Nvidia (NASDAQ: NVDA)—offer distinct exposure to the compute stack.

Image source: Getty Images.

1. Arm Holdings

Arm’s architecture powers virtually every smartphone, and the company is now translating that dominance into the data center. Recent results underscore the momentum: quarterly revenue reached a record $1.49 billion, up 20% year over year. The royalty model—earning a fee on every chip shipped using its instruction set—delivers high incremental margins.

As AI models grow more sophisticated, demand for energy-efficient compute intensifies. Major hyperscalers, including several “Magnificent Seven” constituents, are deploying Arm-based CPUs for AI workloads. Management projects Arm will capture the largest share of data center CPUs by 2030, driven by superior performance-per-watt and rising core counts. Data center royalty revenue is on track to double again over the next year.

While peers have breached trillion-dollar valuations, Arm’s market capitalization sits near $380 billion. The stock trades at a premium multiple, but the expanding addressable market—fueled by relentless data center growth and increasing chip density per server—suggests a path to joining the trillion-dollar club over the coming decades.

2. IREN

AI-driven demand has created a structural shortage of data center capacity. IREN is emerging as a best-in-class builder and operator. Despite a 385% share-price gain over the past year, the company trades at roughly $18 billion—an intriguing valuation for a platform controlling 5 gigawatts of grid-connected power.

IREN has secured long-term cloud contracts with Microsoft and Nvidia. The company expects to bring 480 megawatts online this year and exit 2026 with $4.4 billion in annualized revenue. Expansion plans in Spain and Australia signal a global footprint. The current market price appears to reflect the signed Microsoft and Nvidia contracts while assigning little value to the international pipeline.

In a compute-constrained world, controllable power capacity is a strategic asset. IREN manages construction, design, and operations vertically, enabling repeatable, rapid deployment. Management targets over 1.2 gigawatts online by 2027, with acceleration thereafter.

3. Nvidia

Valuation compression amid sector rotation has created a compelling entry point. Data center revenue nearly doubled last quarter, and the upcoming Vera Rubin platform signals sustained momentum. CEO Jensen Huang has repeatedly anticipated paradigm shifts—from gaming GPUs to accelerated computing, and now to agentic AI infrastructure.

The new Vera CPU line is pacing toward $20 billion in annual revenue, exceeding a third of Intel‘s total. Demand for the Vera Rubin platform, which integrates CPUs, GPUs, and networking for agentic workloads, is expected to be robust. Analysts project total revenue to climb 81% this year to $391 billion.

Competition remains fierce, but Nvidia’s full-stack leadership, software moat (CUDA), and capital intensity position it as the enduring standard for AI hardware. The stock trades at approximately 22 times forward earnings—a reasonable multiple for the central architect of the AI compute era.

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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