Why AI-Linked Stocks Are Surging Thursday

Shares of artificial intelligence names like Palantir Technologies Inc PLTR and C3.Ai Inc AI are trading higher Thursday morning on the heels of NVIDIA Corp's NVDA strong outlook, which was driven by outsized demand for the company's AI chips.

What Happened: Nvidia reported better-than-expected revenue and earnings results after the bell on Wednesday.

The chipmaker also guided for second-quarter revenue of $11 billion, plus or minus 2%, which was well above even the highest analyst forecasts. The consensus estimate for Nvidia's top-line number next quarter was just $7.15 billion.

"A trillion dollars of installed global data center infrastructure will transition from general purpose to accelerated computing as companies race to apply generative AI into every product, service and business process," said Jensen Huang, founder and CEO of Nvidia.

"Our entire data center family of products — H100, Grace CPU, Grace Hopper Superchip, NVLink, Quantum 400 InfiniBand and BlueField-3 DPU — is in production. We are significantly increasing our supply to meet surging demand for them."

Nvidia shares were already up more than 100% since the start of the year ahead of the report, driven by an acceleration in AI development.

The company's H100 GPUs power large language models (LLMs) like ChatGPT. Nvidia recently said that its newest innovations speed up LLMs by 30X over the previous generation.

Why It Matters: At the beginning of the month, commentary surrounding Palantir's new AI platform sparked a significant rally in shares. 

Palantir CEO Alex Karp noted that, "The depth of engagement with and demand for our new Artificial Intelligence Platform (AIP) is without precedent."

C3.ai is also focused on the AI opportunity. The enterprise AI application software company's offerings include an end-to-end platform for developing, deploying and operating enterprise AI applications, a portfolio of industry-specific SaaS enterprise AI applications and a suite of large AI transformer models for the enterprise.

Several other AI-related names are also seeing increased attention on the back of Nvidia's first-quarter report. 

Check This Out: Jim Cramer Trashes Palantir, C3.Ai, Says They Aren't Even 'Real Companies'

Don't Miss This: Jim Cramer Eats His Words On Palantir: Not A 'Real Company' A Month Ago, Now He's High On Profitability, Says Russia Should 'Look Out'

PLTR, AI Price Action: Palantir shares were up 10.9% at $13.56 and C3.ai shares were up 14.3% at $31.83, according to Benzinga Pro.

Photo: Vicki Hamilton from Pixabay.