Investment Opportunities: Top Artificial Intelligence Shares to Acquire by July's Close
Arm Holdings, a semiconductor company known for designing chips and licensing its designs to other manufacturers, has shown a generally positive market outlook as of mid-2025. With shares up about 15% year-to-date, the company's growth is attributed to the booming AI and IoT sectors [1]. However, the broader semiconductor industry has gained 22% so far this year, indicating that Arm slightly lags behind [2].
Analysts have mixed views on Arm's future, with 16 buy, 5 hold, and 1 sell ratings, and an average price target around $162 per share, ranging from $95 to $210 [1]. Arm's business model, which is license-based, creates strong recurring royalties. However, the company faces challenges, such as the rise of the Chinese-backed open-source chip architecture RISC-V, which threatens Arm’s dominance in China, its second-largest market [2].
The Chinese government is pushing RISC-V adoption, aiming to reduce dependence on foreign IP, which could blunt Arm’s growth prospects in that region. Additionally, Arm's reported initiatives to move into producing its own CPUs risk alienating chipmakers that are current customers, potentially straining partnerships and compressing margins [2].
Navitas Semiconductor, a company that aims to improve older technologies for more modern applications, specializes in GaN (gallium nitride) power ICs. These power management solutions are crucial for data centers and AI applications where power efficiency and thermal performance are key [3].
SoundHound AI, on the other hand, develops voice AI and conversational intelligence technologies used in AI assistants and voice-driven interfaces, supporting the AI industry's needs in natural language understanding and human-machine interaction [4].
The global voice-based AI customer service agent business is projected to grow at an average annual rate of 35% through 2033, while the bigger conversational AI market will grow at a solid pace of 24% per year through 2035 [5]. SoundHound AI is positioned to capture at least its fair share of this growth. However, the company's stock has experienced volatility and drama, including questions about its ability to navigate a transition to a subscription-based revenue model and integrate acquisitions [6].
The AI industry's commercialization has led to increased power consumption in data centers, a concern for operators. In fact, the U.S. Department of Energy reports that data centers consumed 4.4% of the United States' total electricity production in 2023 and are expected to be as much as 12% by 2028 [7]. Arm's chips offer power efficiency, using up to 60% less electricity than comparable conventional processing chips in data centers [8].
Navitas Semiconductor's growth strategy is to take an older technology and make it better, and better suited for more modern applications. The company's silicon carbide technology is more durable and cost-effective for handling higher power loads in equipment like solar power systems, electric vehicles, and data centers [9]. Navitas Semiconductor is making forward progress toward profitability, with analysts projecting top-line growth of 51% in the next year and another 39% the year after [10].
In conclusion, Arm Holdings remains a significant player in semiconductor IP with strong ties to AI/data center markets through CPU architecture licensing. Its future growth is influenced by competitive pressures from RISC-V and strategic shifts into hardware design. The contributions of Navitas Semiconductor and SoundHound AI center on power efficiency in chips and voice AI technologies, respectively, both important in the broader AI and data center ecosystem.
[1] Yahoo Finance. (2025). Arm Holdings Stock Price, Quote, Value, History. [online] Available at: https://finance.yahoo.com/quote/ARM?p=ARM
[2] Reuters. (2025). Arm Holdings faces challenges as it moves into chip production. [online] Available at: https://www.reuters.com/business/arm-holdings-faces-challenges-it-moves-chip-production-2025-05-10/
[3] Navitas Semiconductor. (2025). GaN Power ICs. [online] Available at: https://navitassemi.com/products/gan-power-ics/
[4] SoundHound. (2025). About SoundHound. [online] Available at: https://www.soundhound.com/about-us
[5] MarketsandMarkets. (2025). Voice AI Market Worth $60.6 Billion by 2033. [online] Available at: https://www.marketsandmarkets.com/PressReleases/voice-ai.asp
[6] Bloomberg. (2025). SoundHound AI Stock: Is the Volatility Worth the Risk? [online] Available at: https://www.bloomberg.com/news/articles/2025-04-01/soundhound-ai-stock-is-the-volatility-worth-the-risk
[7] U.S. Department of Energy. (2025). Data Center Energy Use. [online] Available at: https://www.energy.gov/eere/articles/data-center-energy-use
[8] Arm Holdings. (2025). Energy Efficiency. [online] Available at: https://www.arm.com/products/energy-efficiency
[9] Navitas Semiconductor. (2025). Silicon Carbide MOSFETs. [online] Available at: https://navitassemi.com/products/silicon-carbide-mosfets/
[10] Zacks Investment Research. (2025). Navitas Semiconductor NVS: Earnings Estimates Raised for Next Year. [online] Available at: https://www.zacks.com/stock/news/3062236/navitas-semiconductor-nvs-earnings-estimates-raised-for-next-year
Investing in Arm Holdings might be of interest to those focused on the finance sector, given its strong recurring royalty business model and ties to AI and data center markets. However, the company faces challenges such as competition from RISC-V and potential strains from its shift into hardware design.
On the other hand, Navitas Semiconductor and SoundHound AI are making significant contributions to the AI industry by focusing on power efficiency in chips and voice AI technologies, respectively, both important in modern applications and data centers. Analysts project strong growth for Navitas Semiconductor in the coming years.
