Stock Market

AI stocks have dominated the financial headlines in 2023. By now, you’re familiar with how artificial intelligence could change every aspect of our lives. You’ve likely seen the oft-cited Grand View Research stat that the global AI market could hit $1.81 trillion by 2030. And you’ve probably heard Bank of America analysts say AI is on the brink of an “iPhone moment” and could boost the global economy by $15.7 trillion by the end of the decade.

“We are at a defining moment — like the internet in the ’90s — where [AI] is moving towards mass adoption, with large language models like ChatGPT finally enabling us to fully capitalize on the data revolution,” the firm said.

Along the way, you’ve also heard about the big AI stocks like C3.ai (NYSE:AI), Nvidia (NASDAQ:NVDA), Microsoft (NASDAQ:MSFT), Alphabet (NASDAQ:GOOGL, GOOG), Palantir Technologies (NYSE:PLTR), Intel (NASDAQ:INTC) and Alibaba (NYSE:BABA). However, there are a few surprising AI plays you might not have thought of like the ones below.

RHI Robert Half $74.96
CAT Caterpillar $215.53
SOUN SoundHound AI $3.07

Robert Half (RHI)

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Global human resource consulting firm Robert Half (NYSE:RHI) offers professional staffing services.

As its partner Atrium noted, in the past, connecting candidates with employers was largely done through paper-based processes and legacy IT systems. But Robert Half has since begun to harness the power of AI, working together with Atrium to build machine-learning models that “can quickly identify top matches to open job orders and expand their talent search by surfacing new candidates who are similar to those already on their lists in order to best meet their clients’ needs.”

While the latest jobs report points to a weakening labor market as companies look to cut costs by laying off workers, the incorporation of AI and machine learning should support demand for Robert Half’s services. According to ComputerWorld, two recent studies show that 35% to 45% of companies plan to use AI-based talent acquisition software and services to fill job positions in the year ahead.

Caterpillar (CAT)

Source: astudio / Shutterstock.com

Even construction equipment company Caterpillar (NYSE:CAT) is taking part in the AI boom. In fact, the company is “investing heavily in AI,” according to Chief Executive Officer (CEO) Jim Umpleby.

“The company has for years been digitizing everything from bulldozers to diggers to get early alerts of problems and keep them from breaking down. Its system uses AI to better anticipate when a machine may break, and in some cases may automatically alert a dealer to provide a new part,” Bloomberg reports.

Additionally, the company’s digital tech division, Cat Digital, uses AI and digital twins to discover how customers use its products in an effort to improve design and efficiency.

“From selling hardware and services, Caterpillar may be able to even offer A.I.-driven customer outcomes such as ultra-granular forecasting of downtimes and highly automated drilling processes,” Fortune reports.

SoundHound AI (SOUN)

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SoundHound AI (NASDAQ:SOUN) is perhaps the most obvious of today’s under-the-radar AI stocks, as it has “AI” in its name. The $675 million company’s “independent voice AI platform connects people to brands through customized conversational experiences that voice-enable products, services, and apps while giving companies access to their valuable data and analytics for greater control and brand ownership of the customer experience.”

SoundHound AI is working with the auto industry, integrating voice assistants into vehicles. This is a massive market opportunity for the company, with analyst Sam Abuelsamid predicting 90% of new vehicles will have voice assistants by 2028.

“Conversational AI is at a watershed moment and our proprietary Dynamic Interaction and Generative AI solutions are perfectly positioned,” said CEO Keyvan Mohajer in the company’s latest earnings release. “From electricity to telecommunications to internet search, each generation has established a new foundational capability to better serve society, and AI will catalyze this next horizon.”

Speaking of earnings, fourth-quarter revenue was up 84% year over year to $9.5 million. Gross margin improved to 71%, while the company’s losses shrunk. In other words, SoundHound AI is moving in the right direction fundamentally.

On the date of publication, Ian Cooper did not have (either directly or indirectly) any positions in the securities mentioned. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.

Ian Cooper, a contributor to InvestorPlace.com, has been analyzing stocks and options for web-based advisories since 1999.

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