OpenAI and Nvidia get most of the headlines around artificial intelligence, but there are many other company's stocks that investors could trade to profit from the AI boom. How so? Companies in the AI cloud services and AI-powered applications software sectors – along with providers of hardware and power for AI data centers – present compelling opportunities.

For example, is AI cloud-services provider Oracle or AI-powered data analytics company Palantir a better investment?

Oracle may be the better bet given its superior risk return. Although risk-loving traders may try to ride the Palantir rollercoaster.

Read on for a comparison of the companies' AI business strategies, growth trajectories, financials,valuation and investor sentiment.

Oracle Cloud Infrastructure’s partnerships drive the company’s AI strategy. Although Oracle is the fifth largest global provider of cloud infrastructure, with about 4% share, OCI is growing faster than its larger rivals, such as AWS (31% market share), Microsoft Azure (22%) and Google Cloud (12%).

OCI’s growth has benefited from Oracle’s partnerships with leading AI chatbot providers and the chipmaker Nvidia. Partnerships include OpenAI, xAI (Elon Musk's AI company), and Meta, according to Oracle’s most recent earnings call transcript.

Oracle also benefited from its rivals’ use of its database software. For instance, AWS, Azure, and Google Cloud use Oracle’s multi-cloud database – yielding 1,529% growth in the company’s first-quarter fiscal 2026 report by deploying “34 cloud regions inside competitor platforms,” Oracle founder and chief technology officer Larry Ellison said in a company release.

Palantir operates in various market segments, including data analytics, AI platforms and mission-critical decision systems. The company enjoys a competitive advantage from decades selling to the U.S. government, and Palantir’s success launching AI platforms quickly and effectively.

For instance, Palantir has spent more than 20 years working with the Department of Defense, Central Intelligence Agency and the U.S. Army. Moreover, the company’s rapid deployment of its AIP — fewer than “two months from bootcamp to production,” according to Futurum Group — has helped Palantir win new contracts.

Palantir’s value for customers is reflected in the company’s 128% net-dollar retention rate, indicating strong upselling to existing customers, according to Yahoo! Finance. Customer success stories“include "Cleveland Clinic reducing ER wait times by 38 minutes and Tampa General Hospital shortening sepsis patient stays by 15%,” according to a Palantir investor update.

Oracle’s business strategy, financial performance and prospects, and the stock's upside differ significantly from Palantir’s. Oracle focuses mostly on database software – where it is a clear leader – and data centers, and the company's potential stock upside may be higher.

Palantir’s strategy is dispersed across more market segments, making its growth prospects much higher. However, Palantir’s stock risks falling: The company has a very high valuation and growth is expected to slowdown.

Oracle supplies products mostly for enterprises, while Palantir’s services are more specialized and mostly aimed at governments.

Oracle’s services included OCI, enterprise applications — enterprise resource management, human capital management and customer relationship management — as well as database services. Oracle sells to companies of all sizes in many vertical markets and works extensively with partners and other resellers.

Palantir supplies more specialized services, including data integration, analytics and an AI platform. While it's expanding its commercial footprint, Palantir has mostly worked with governments, which accounted for more than half the company’s revenue last year.

Oracle is growing more slowly, has greater potential for revenue acceleration and has been more consistently profitable. Palantir is growing faster, could suffer a slowdown and first became profitable as recently as the fourth quarter of 2022, Reuters reported.

Oracle’s growth rate has accelerated in the last four quarters. The company’s OCI unit grew faster than rival cloud services providers, and the company has a significant backlog. For example, Oracle’s revenue growth increased from 7% to 12% between the third quarter of fiscal 2024 and the first quarter of FY 2026, when the company earned a 19.6% net margin.

In first-quarter 2026, OCI revenue increased about 53% – faster than AWS (18%) and Microsoft Azure (about 24%). Most impressively, Oracle’s Remaining Performance Obligations backlog in September 2025 soared 359% to $455 billion, as I wrote last month on Forbes.

Palantir grew faster, however analysts expect the company’s growth to decelerate below management’s projections. Between Q2 2024 and Q2 2025, Palantir’s revenue growth went from 27% to 48%. In the most recent quarter, Palantir’s net margin was 32.5%, up from 24% in the first quarter of 2025.

However, Palantir’s growth appears to be slowing down. Management projects 45% growth for 2025, according to a company release, although analysts forecast growth moderating to between 25% and 45% in 2026, Simply Wall Street reported.

Palantir has a higher valuation than Oracle and analysts see greater downside risk to holding Palantir stock.

Oracle trades at a price-to-sales ratio which is roughly equal to the enterprise software industry average of 8 to 12. Given Oracle’s significant revenue backlog in its OCI unit, the company's valuation could be considered low, TradingView noted.

Palantir’s price-to-sales ratio was 127 on Oct. 6 – nearly seven times more than rival Snowflake’s P/S ratio of 19.

Both Oracle and Palantir face significant risks. Oracle’s worries include large capital expenditures to supply OCI demand and intense rivalry. Palantir’s high valuation would mean any execution failure could sink its stock.

While Wall Street maintains 74% "Buy" ratings on Oracle because of its high valuation, analysts are more skeptical of Palantir despite its superior operational performance. Consensus ratings on Palantir show "Hold" with between 60% and 65% of analysts neutral, according to TipRanks.

Palantir stock is 9% overvalued according to TipRanks, which sets an average price target of $165. Oracle’s price target of $341 suggests the stock has 19% upside.

If you have a big appetite for risk, go with Palantir. If you are looking for relatively predictable growth at a reasonable price, consider buying Oracle stock.

Analysts have more confidence in Oracle’s upside because it has a more reasonable valuation and a large backlog of future OCI orders. By contrast, analysts see growth slowing for Palantir, making its eye-popping valuation hard to justify.

Of course, if Palantir keeps beating and raising, the stock will pop.

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