Artificial intelligence stocks are closing out 2025 with a familiar mix of momentum, skepticism, and shifting geopolitics. On December 23, 2025, several headlines moved the AI investing narrative beyond a simple “chips up, everything else follows” story: fresh signals on AI chip exports to China, a new wave of mega-cap spending for AI infrastructure, and a growing debate over whether U.S. AI leaders are pricing in too-perfect outcomes.
Below is a breakdown of the most market-relevant news, forecasts, and analyst takes dated Dec. 23, 2025, and how investors are framing the next leg of the AI cycle into 2026.
The big AI-stock themes investors are watching on Dec. 23, 2025
1) China re-enters the AI-chip conversation—without killing the “AI trade”
AI chip policy has become one of the biggest swing factors for the sector. U.S. policy shifts are reopening a pathway for Nvidia’s H200 shipments to China, with reporting indicating shipments could begin around mid-February 2026. [1]
In parallel, AMD’s China-compliant accelerator narrative is gaining traction, with market chatter around potential large orders tied to Chinese cloud demand (including Alibaba). [2]
Why it matters for AI stocks: China is still a major incremental demand pool for AI compute. Even partial re-openings can change revenue expectations, inventory planning, and the pricing power story that has underpinned the AI semiconductor rally.
2) Investors rotate attention to Chinese AI names as U.S. “bubble” talk grows louder
A major Reuters report on Dec. 23 said global investors are increasingly looking to Chinese AI companies as Wall Street worries about elevated U.S. AI valuations and as China accelerates tech self-sufficiency. The report highlighted interest in names tied to China’s AI and semiconductor push (including major platforms and domestic chip efforts) alongside caution that some valuations are hype-driven. [3]
The takeaway for U.S.-listed AI stocks is nuanced:
- It’s not just “money leaving the U.S.” It’s portfolio diversification as AI becomes a global capex supercycle.
- It adds a new competitive frame: U.S. AI leaders vs. China’s policy-backed scaling.
3) AI capex is still climbing—power, data centers, and infrastructure are the new battleground
A Dec. 23 Wall Street Journal report said Alphabet is buying Intersect (a data-center developer) for $4.75 billion, positioning the deal as part of the infrastructure push to meet AI-driven compute and energy needs. [4]
At the same time, Reuters reported that ByteDance plans roughly $23 billion of AI infrastructure spending in 2026 (per a Financial Times report), underscoring how global the AI buildout has become. [5]
The market implication: the “AI winners” list keeps expanding from GPU vendors to the entire stack—cloud, data centers, power procurement, networking, and enterprise software—but investors are also demanding clearer evidence that spending converts into durable profits.
AI chip stocks: Nvidia, AMD, Broadcom—what’s driving forecasts into 2026
Nvidia stock: China exports, supply planning, and the next earnings narrative
Nvidia remains the bellwether for AI stocks because the market still treats GPU demand as the cleanest real-time signal for AI infrastructure. This week’s key catalyst is the China export backdrop, including reporting around H200 shipments beginning mid-February 2026 and discussions of ramping output to meet perceived demand. [6]
What analysts and investors are likely to debate next:
- How much demand is incremental vs. pulled forward ahead of policy windows.
- Whether export approvals come with constraints that affect margin or mix.
- Whether “next-gen” product cycles keep pricing power intact while older inventory finds new outlets.
AMD stock: MI308 and the “catch-up” trade gets a China catalyst
AMD’s AI narrative has been about scaling the accelerator business fast enough to matter against Nvidia’s entrenched ecosystem. The potential China angle—centered on the MI308—adds a tactical revenue lever that could influence near-term revisions if approvals and orders firm up. [7]
Investors are watching for:
- Timing and size of any China-linked ramps.
- Whether demand is broad-based across Chinese cloud providers or concentrated.
- How AMD balances accelerator growth with supply chain realities and competitive positioning.
Broadcom stock: AI is strong—margins are the watch item
Broadcom is often discussed as the “picks-and-shovels” AI name beyond GPUs: networking plus custom silicon (ASICs) tied to hyperscaler AI deployments. But Reuters coverage in December highlighted a pressure point: the company warned that a higher mix of certain AI revenue could weigh on gross margin, which helped reignite broader “AI payoff” jitters. [8]
In other words, demand isn’t the only question anymore. The market is getting more granular:
- Which AI products are growing fastest?
- Are they higher-margin software-like revenues or more hardware/system-like mix?
- How much customer concentration risk exists in custom AI silicon?
AI platform and software stocks: Microsoft, Alphabet, Palantir, Reddit—where the market sees upside and risk
Microsoft stock: “Undervalued” calls return as Copilot and Azure stay central
A Dec. 23 Investopedia piece cited Wedbush’s view that Microsoft is still undervalued, with an “outperform” rating and a $625 price target, tying the thesis to Microsoft’s role in AI infrastructure via Azure and AI products like Copilot. [9]
The broader Microsoft-AI stock debate going into 2026:
- Can Microsoft monetize AI broadly across enterprise without margin dilution?
- Does AI-driven Azure growth remain resilient if customers optimize spending?
- Will AI assistants expand software pricing power, or become table stakes?
Alphabet stock: AI investment turns into physical infrastructure strategy
Alphabet’s reported Intersect acquisition is a reminder that the AI race is now as much about power and capacity as it is about models. The market is increasingly valuing companies that can secure long-duration infrastructure at scale—especially as compute demand rises. [10]
Palantir stock: blockbuster year meets valuation gravity
Palantir has been one of the most visible AI-linked winners in 2025, but bullish narratives are colliding with valuation debates. Recent analysis pieces argue the company’s fundamentals are strong, yet the valuation may leave little room for disappointment if growth decelerates. [11]
The 2026 setup for Palantir investors typically comes down to:
- Can U.S. commercial growth stay explosive?
- Does operating leverage expand fast enough to justify premium multiples?
- How sensitive is the stock to any macro-driven software spending slowdown?
Reddit stock: an “AI data” angle enters the 2026 stock-pick conversation
Barron’s reported on Dec. 23 that Needham named Reddit a top pick for 2026, emphasizing advertising upside and the strategic value of Reddit’s user-generated content in the AI ecosystem, including content licensing dynamics. [12]
This is part of a larger market theme: “AI stocks” aren’t only the companies building AI—some are increasingly seen as owners of scarce training data or distribution channels that AI models rely on.
The risks that could hit AI stocks next: accounting scrutiny, bubble fears, and “ROI fatigue”
Depreciation and “earnings optics” become a surprise risk factor
A Reuters analysis on Dec. 23 highlighted concerns that some big tech firms could be adjusting depreciation schedules in ways that improve reported profitability—legal, but potentially misleading if it obscures the true cost of AI infrastructure. The piece framed this as a hidden risk investors may watch more closely in 2026. [13]
Why it matters for AI stocks: the market has been willing to fund massive AI capex as long as revenue growth and margins look strong. If investors suspect earnings quality is being propped up by accounting choices, multiples can compress quickly—even without a collapse in demand.
Bubble talk persists—but so does the spending cycle
Reuters reporting this month has repeatedly referenced AI “bubble” concerns even while executives and investors argue the industry isn’t purely speculative. The push-pull dynamic is important: even if AI is real, stocks can still correct when expectations run too far ahead of fundamentals. [14]
Retail participation remains a powerful accelerant
Reuters also reported Dec. 23 that retail investors are set to post record U.S. equity inflows in 2025 and have been heavily involved in popular AI-linked names—helping shape momentum and “buy-the-dip” behavior. [15]
That matters because the AI trade has increasingly been a blend of fundamentals and positioning. In 2026, crowdedness could amplify both rallies and drawdowns.
What “AI stocks” could mean in 2026: a shift from infrastructure to implementation
One of the more important emerging narratives is that the market may broaden from “who sells the compute” to “who turns compute into measurable productivity.” That means:
- Semiconductors remain core, but may face sharper cycle and margin debates.
- Cloud platforms compete on AI toolchains, enterprise adoption, and distribution.
- Data owners and networks (content, communities, transaction rails) gain attention as AI relies on high-quality inputs and real-world deployment.
On Dec. 23, the news flow reinforced that AI is no longer a single trade—it’s a multi-lane ecosystem spanning chips, energy, infrastructure, software, and data.
References
1. www.investors.com, 2. www.investors.com, 3. www.reuters.com, 4. www.wsj.com, 5. www.reuters.com, 6. www.investors.com, 7. www.investing.com, 8. www.reuters.com, 9. www.investopedia.com, 10. www.wsj.com, 11. seekingalpha.com, 12. www.barrons.com, 13. www.reuters.com, 14. www.reuters.com, 15. www.reuters.com
