Ryan Vanzo, The Motley Fool

Fri, Jun 6, 2025, 4:00 AM4 min read

• Intel is looking like a promising turnaround story.

• But Buffett is betting $2 billion on another AI stock.

• 10 stocks we like better than Amazon ›

Warren Buffett, the longtime CEO of Berkshire Hathaway, is famous for his long-term bets. Many of his biggest investments have been in his portfolio for decades. Right now, the AI revolution is creating lucrative multidecade opportunities for growth, allowing investors to replicate Buffett's patient strategy with high-growth stocks.

When it comes to AI stocks, Nvidia is king. The company is the leading manufacturer of graphics processing units, or GPUs -- specialized chips that make machine learning and artificial intelligence training and execution possible. Nvidia's highly sought-after GPUs gives it an estimated market share of around 90% for AI applications. The company also posts industry-leading gross margins, demonstrating its technological superiority and reputation for quality. With AI spending expected to rise by more than 30% annually over the long term, Nvidia will continue to be at the center of the AI revolution, supplying the industry with the critical components it needs to survive and thrive.

As previous chip wars have demonstrated, however, Nvidia's lead won't last forever. It may still grow its sales and profits tremendously over the next decade thanks to underlying market growth and a durable software advantage. But over time, expect other companies to compete on price and performance, particularly in niche areas that aren't as lucrative for Nvidia right now. One Buffett-style value pick right now looks to be Intel (NASDAQ: INTC). Intel is losing the AI war right now, with an inferior offering and lackluster gross profit levels. But shares are priced according to that reality.

It's going to be a long road for Intel. Years of poor investment and ill-advised acquisitions have squandered a once-promising lead in GPU manufacturing. But management is trying to turn things around. The company is spending billions to improve its AI offerings and may have a chance to penetrate the market with energy-saving chips, even if those chips are inferior from a raw performance standpoint compared to Nvidia's offerings.

Will Intel turn things around any time soon? It's not likely. But those willing to take Buffett-style, long-term approaches could be getting a bargain valuation on a stock that could re-emerge as an AI winner a decade down the line.

Right now, Buffett's holding company owns $2 billion worth of shares in a company that is dominating AI: Amazon (NASDAQ: AMZN). But wait a second -- isn't Amazon an e-commerce company? That's where most of its revenue is still generated. However, when it comes to operating profit, Amazon Web Services, or AWS, is actually the biggest contributor.