U.S. stock performance in 2025 has been somewhat disappointing, with President Donald Trump’s return to protectionist economic policies placing a strain on leading tech companies. These firms have acted as primary growth drivers for the S&P 500 (^GSPC -0.33%) since late 2022. While short-term market fluctuations can be unsettling, they create chances to acquire promising companies at attractive valuations. Artificial intelligence (AI) stocks exemplify this trend. Despite remarkable growth in the past two years, many high-performing AI firms have faced significant corrections since early 2025. Here are two AI stocks that appear to be worthwhile long-term investments.
Archer Aviation: Soaring Beyond Traditional Aviation
Archer Aviation (ACHR -3.51%) presents a compelling investment opportunity, despite its shares declining nearly 17% year to date. With a current market cap of $4.4 billion, Archer, an electric vertical takeoff and landing company, has established itself as an AI stock through strategic partnerships with Palantir Technologies and Anduril Industries. They leverage Palantir’s Foundry and Artificial Intelligence Platform (AIP) to develop next-generation aviation systems for air traffic control, movement control, and route planning.
With commercial potential spanning tens of billions in defense and commercial aviation markets, Archer has also secured Abu Dhabi Aviation as the first customer for its “Launch Edition” commercialization program. The company is likewise positioned to pursue defense contracts via its partnership with Anduril Industries, which specializes in autonomous military systems. Bolstered by a strong balance sheet, with over $1 billion in liquidity, Archer has a firm financial footing from which to execute its AI-driven vision for the future of flight.
The convergence of the AI and electric aviation markets makes Archer an appealing investment. The company possesses the financial strength and technological partnerships to become a major player in this emerging transportation space, which analysts project will reach $1 trillion by 2040. The combination of established partnerships, solid finances, and a massive addressable market creates a favorable risk-to-reward ratio for long-term investors.
Autonomous Innovation at Serve Robotics
Serve Robotics (SERV -3.77%) is changing the landscape of last-mile delivery with its AI-powered autonomous sidewalk robots. This company has seen a significant decline of 46% year-to-date. However, its revenue grew 773% year over year to $1.8 million in 2024, demonstrating increasing market adoption. Serve is also expanding its operational footprint beyond Los Angeles into Miami and major markets like Dallas-Fort Worth and Atlanta.
Serve has also completed the design of its third-generation robots, which feature significantly enhanced capabilities, including twice the speed and range plus 5x more AI computing power at reduced manufacturing costs compared to previous models. Through partnerships with Magna International and Shake Shack, Serve has expanded its reach to over 1,000 restaurants and 300,000 households. With $123 million in cash at year-end 2024 and an additional $80 million raised in early 2025, Serve has strong financial standing to achieve its ambitious plan of deploying 2,000 robots across the U.S. by the end of 2025.
Serve’s high revenue-growth potential, coupled with falling unit costs, creates a clear path to profitability as its robot fleet expands. This situation could deliver substantial returns once the company’s robots become ingrained within the last-mile delivery environment across the United States.
Balancing Risk and Reward
While these AI innovators present considerable upside potential, investors must remain mindful of the risks. Archer Aviation faces potential regulatory hurdles on its path to widespread commercial certification, while Serve Robotics must demonstrate effective scaling across diverse urban environments. Both companies generate minimal revenue relative to their market valuations and will likely necessitate more capital, despite their powerful cash positions. Those concerns appear to be factored into their current valuations.
As a result, the market’s short-term aversion to growth stocks creates a compelling entry point for investors willing to embrace volatility while these companies execute their ambitious plans. This approach involves using the current period of uncertainty as an opportunity to accumulate shares in these two innovative AI companies.
