Market cycles typically include phases of rising stock prices, known as bull markets, which feature gains of 20% or more from recent lows. For long-term investors, maintaining a consistent investment strategy despite periodic market volatility is crucial. This often involves allocating fixed investment amounts at regular intervals regardless of market fluctuations, thereby avoiding reactive decisions driven by daily price movements.
A key aspect of this approach is emphasizing companies with robust fundamentals. Such a focus tends to help investors endure market downturns while positioning their portfolios for sustainable growth over time. With this in mind, discerning investors interested in artificial intelligence's transformative potential may find value in two distinct firms with strong prospects for growth: Symbotic and Applied Digital.
Symbotic: Innovating AI-Driven Warehouse Automation
Symbotic is a technology firm specializing in end-to-end robotic warehouse automation solutions powered by artificial intelligence. Originating with the aim of optimizing supply chain logistics for retail and wholesale operations, the company employs fleets of autonomous robots combined with proprietary software systems. These solutions facilitate the management of goods, including tasks such as storage organization, retrieval, and palletization within large distribution centers.
Significantly, Symbotic outsources the production of its robotic components to established manufacturers in the automotive sector. This strategy allows the company to rapidly scale operations without investing heavily in capital-intensive manufacturing facilities. The primary way Symbotic generates revenue is through sales of modular, turnkey automation systems designed for integration into the expansive distribution centers of major clients including Walmart, Target, and Albertsons.
The company’s recent expansion into the healthcare sector through a collaboration with Medline suggests potential for broadening market penetration. Once their systems are installed, Symbotic benefits from continuous income streams via software maintenance, ongoing technical support, and operational assistance for deployed hardware.
In addition to direct sales, Symbotic is advancing a service-based model through its GreenBox warehouse-as-a-service joint venture with SoftBank. This initiative targets smaller businesses that may prefer automated warehousing solutions without the need to own physical hardware, presenting a promising channel for recurring revenues over the long term.
Walmart stands out as a cornerstone partner, owning approximately 15% of Symbotic as of 2024. The acquisition of Walmart’s Advanced Systems and Robotics business in 2025 further integrates Symbotic’s technology into one of the retail giant’s core operations. Currently, the company reports a contracted backlog of about $22.5 billion, nearly ten times its annual sales, affording substantial revenue visibility for future years. A large portion of this backlog ties back to its GreenBox venture and its partnership with Walmart.
Symbotic achieved a surge in full-year 2025 revenue, increasing by 26% to nearly $2.3 billion. The company has faced challenges in consistently delivering profits but recently reversed trends by generating approximately $788 million in free cash flow, a significant improvement from a prior negative figure of $102.45 million. Investors with an appetite for risk and growth-seeking AI robotics stocks might view Symbotic as a compelling candidate, considering its sizable growth runway and industry positioning.
Applied Digital: Powering AI with Next-Gen Data Centers
Applied Digital operates as a designer, developer, and operator of advanced digital infrastructure and cloud services tailored to the artificial intelligence and high-performance computing segments. The company functions primarily as an AI infrastructure provider, delivering specialized data center facilities and power systems to large hyperscale clients through multiyear contractual arrangements.
To maximize operational efficiency and cost-effectiveness, Applied Digital strategically locates its data centers in regions offering abundant and affordable electricity, frequently near renewable energy resources. This approach enhances sustainability while reducing expenses associated with powering high-density computing environments.
The company’s business consists of two principal areas. The first is its data center hosting capability, leasing purpose-built, liquid-cooled, high-density AI computing centers, sometimes referred to as AI factories, to large hyperscalers such as CoreWeave. In these agreements, the hyperscalers typically provide the computing hardware components like GPUs and servers.
The second core segment is its cloud services offering, providing on-demand GPU power through a scalable, secure, and managed GPU-as-a-service platform. This enables organizations requiring high-performance computing to access necessary resources without undertaking the capital and operational responsibilities of owning and managing infrastructure.
Applied Digital’s revenue streams derive from long-term lease agreements and service contracts. Its partnership with CoreWeave alone accounts for roughly $11 billion of its $16 billion contracted revenue projected over the next 15 years. The remainder pertains to another confidential hyperscaler client.
Funding construction of new data centers is capital-intensive. To address this, Applied Digital leverages strategic partnerships, including a $5 billion financing facility with Macquarie Asset Management, which supports project-level developments. The company maintains an active development pipeline totaling 4 gigawatts of capacity geared specifically for AI data center needs, addressing a critical shortage in the market for specialized AI workloads.
Supply chain management has been instrumental in Applied Digital’s growth, enabling acquisition of necessary land, power, and equipment resources. These efficiencies have shortened construction timelines from typical durations of 24 months to approximately 12 to 14 months, thereby offering a competitive advantage through faster deployment.
Despite net losses owing to upfront construction expenditures, depreciations, and non-revenue-generating facilities, the company’s revenue demonstrated robust growth — expanding 84% in the recent quarter to $64.2 million. For investors interested in emerging players addressing the explosive need for AI and cloud computing infrastructure, Applied Digital represents an opportunity to tap into a vital segment of the technology ecosystem.
Conclusion
Both Symbotic and Applied Digital occupy distinct niches within the expanding AI sector, each with significant growth potential supported by strong contractual backlogs and strategic partnerships. Symbotic’s expertise lies in robotics-driven warehouse automation with long-term collaborations in retail and healthcare, while Applied Digital specializes in the critical infrastructure needed to power AI services and high-performance computing.
Investors considering exposure to artificial intelligence technology companies should weigh these firms’ business models, market positions, and financial fundamentals. Maintaining focus on quality and fundamental strength remains paramount in navigating both bull and bear markets as the AI industry evolves.