Using Zacks Thematic Filters to Explore the AI Infrastructure Growth Curve

AI Infrastructure: The Real Engine Behind the Revolution

While much attention is given to AI-powered applications, the true investment opportunities lie in the foundational infrastructure that supports them. This critical layer—comprising the computing power and data pipelines—serves as the backbone for the next wave of technological advancement. Companies leading this space are not just riding the AI trend; they are the essential architects enabling its rapid expansion.

NVIDIA: Powering the AI Boom

At the heart of this infrastructure is NVIDIA, whose dominance is underscored by a remarkable $68.1 billion in quarterly revenue, reflecting a 73% increase from the previous year. This surge is largely fueled by relentless demand for its GPUs in data centers, with the Data Center division alone generating $62.3 billion—a 75% jump. These figures highlight NVIDIA's pivotal role as the driving force behind AI model training and deployment, marking a new era of exponential growth.

Palantir: Transforming Data into Intelligence

On the software and data side, Palantir stands out by automating complex analytical processes. The company reported robust growth, with total sales reaching $1.4 billion—a 70% year-over-year increase. Notably, its U.S. operations soared by 93%. Palantir is building the software infrastructure that converts raw data into actionable insights, a crucial component for scaling any AI system.

Together, NVIDIA and Palantir exemplify the multi-layered nature of AI adoption. NVIDIA supplies the computational foundation, while Palantir delivers the advanced software needed to leverage that power. Investing in these core enablers is a bet on the infrastructure that will underpin the next technological era.

Navigating the AI Landscape with the Zacks Thematic Screen

For those looking to capitalize on the AI infrastructure trend, the Zacks Thematic Screen provides a strategic approach. This tool helps investors cut through the noise, focusing on companies at the heart of the AI adoption curve—not just flashy end-user applications, but the builders of the underlying framework.

The screen highlights a wide array of businesses involved in AI, from hardware and software creators to those implementing the technology. This diversity reflects the broad scope of the AI revolution, emphasizing the importance of both computational engines and intelligent software platforms.

By zeroing in on companies developing the essential tools for AI, the screen aligns with a deep tech investment philosophy. It brings to the forefront firms like NVIDIA and Palantir, whose impressive results demonstrate their central role in driving exponential growth. This targeted approach helps investors distinguish genuine opportunities from market hype.

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Understanding Adoption Curves and Financial Signals

The financial performance of companies like NVIDIA and Palantir offers a window into their position on the AI adoption curve. For businesses experiencing rapid, early-stage growth, metrics such as revenue and earnings growth rates reveal accelerating demand and expanding market share.

NVIDIA’s latest results are a prime example: $68.1 billion in quarterly revenue—up 73% year-over-year—and an 82% increase in adjusted earnings per share. The Data Center segment alone reached $62.3 billion, underscoring NVIDIA’s role as the backbone of AI infrastructure.

For software platforms like Palantir, recurring revenue and adoption velocity are key. The company’s 70% overall sales growth, and especially the 93% surge in its U.S. business, indicate strong and accelerating platform uptake.

Ultimately, the most telling indicators are the growth rates themselves. When a company consistently reports 70–80% annual increases, it signals that it has moved beyond the uncertain early phase and is now scaling rapidly. For investors, these numbers confirm that the essential infrastructure is being built—and monetized—at an unprecedented pace.

Valuation and Scenario Planning: Looking Beyond the Surface

Conventional valuation metrics, such as price-to-earnings ratios, often fail to capture the true potential of companies in the midst of exponential growth. For investors, the focus should shift to market share expansion and the strength of network effects. NVIDIA, with its 73% annual sales growth, is valued not just for current profits but for its commanding position in the AI compute landscape.

In a bullish scenario, continued growth in AI workloads sustains high demand for NVIDIA’s platforms, reinforcing its leadership and justifying a valuation premium. However, risks remain—such as the potential for new competitors or alternative technologies to erode margins, or a slowdown in AI adoption due to economic or regulatory challenges. While current trends are strong, the exponential growth model is sensitive to shifts in adoption rates.

For infrastructure providers, the challenge is to maintain their edge as the market evolves. NVIDIA’s current dominance is rooted in its early capture of the high-growth phase, but increased competition could test its ability to sustain premium positioning. The investment case rests on the belief that NVIDIA will continue to shape the industry, not just participate in it.

Key Catalysts and What to Monitor Next

Financial results now confirm the rapid expansion of AI infrastructure. The next step is to assess the durability of this growth and identify upcoming turning points. Investors should pay close attention to product launches that extend the capabilities of the compute stack, as well as quarterly updates that reveal whether adoption is accelerating or stabilizing.

For NVIDIA, the introduction of new AI chip architectures could mark the next major inflection point, especially if they deliver significant improvements in efficiency or enable new applications. For Palantir, the release of innovative software modules or integrations that enhance the value of its platform will be key indicators of continued momentum.

On the financial front, sequential growth rates are crucial. NVIDIA’s Data Center segment recently posted a 22% quarter-over-quarter increase; further acceleration would signal intensifying demand. Palantir’s 28% sequential growth in U.S. sales is another important metric—sustaining or surpassing this pace would suggest the adoption curve is steepening, while a slowdown could indicate early market saturation.

Institutional recognition, such as the launch of new thematic screens by firms like Zacks, also serves as a catalyst by bringing more structured investment approaches to the sector. This can attract additional capital to the infrastructure layer, further accelerating its development.

In summary, the exponential growth story is now reflected in company financials. The next milestones will be defined by breakthrough innovations and quarterly guidance that confirm whether the infrastructure build-out is keeping pace with the demands of the new technological era. Stay alert to these signals to gauge the ongoing evolution of the AI infrastructure landscape.