TLDR: Wall Street analysts are forecasting a dramatic 600% increase in artificial intelligence spending by 2028, identifying Amazon and HubSpot as top investment picks poised to capitalize on this growth, distinct from traditional AI favorites like Nvidia and Palantir. This surge in AI investment is already contributing substantially to U.S. economic growth.
Artificial intelligence (AI) expenditures are set to experience an unprecedented boom, with Morgan Stanley analysts projecting a more than 600% increase in AI spending across software and internet companies by 2028. This substantial growth is already making a significant impact on the economy, having added over one percentage point to U.S. economic growth in the first half of 2025, outperforming traditional drivers like consumer spending.
Amidst this burgeoning market, Wall Street experts are pointing to Amazon (AMZN) and HubSpot (HUBS) as two ‘brilliant AI stocks’ poised for considerable gains, distinguishing them from investor darlings such as Nvidia and Palantir. Analysts believe these companies are currently undervalued and offer compelling upside potential.
Amazon, a diversified titan in e-commerce, digital advertising, and cloud computing, is leveraging AI across all its segments. The company has reportedly developed 1,000 generative AI applications to enhance the efficiency of its retail operations, optimizing inventory placement, demand forecasting, and last-mile delivery. Furthermore, Amazon is utilizing AI models to enable robots to navigate warehouses more rapidly and facilitate conversational interactions with workers. The company is also exploring the use of humanoid robots for package delivery. In its Amazon Web Services (AWS) division, custom chips engineered for AI training and inference are said to offer superior price performance compared to existing GPUs, alongside the introduction of new generative AI services.
HubSpot, a leading customer relationship management (CRM) platform, is also making significant strides in the AI space. The company reported robust financial results in the second quarter, driven in part by the strong adoption of its AI platform, Breeze. This indicates a successful integration of AI technologies into its core offerings, resonating well with its customer base.
Also Read:
- Global AI Spending Projected to Reach $1.5 Trillion in 2025, Driven by Infrastructure and Product Integration
- Analysts Affirm Amazon’s Strong Position Driven by Generative AI Growth and AWS Performance
Wall Street analysts have set optimistic price targets for both companies. For Amazon, a median target price of $264 per share from 71 analysts suggests a 14% upside from its current share price of $231. HubSpot, meanwhile, has a median target price of $679 per share from 36 analysts, implying a more substantial 31% upside from its current share price of $517. These forecasts underscore the confidence in Amazon and HubSpot’s ability to capitalize on the escalating AI investment landscape.
