Artificial intelligence (AI) investing is a remarkably broad field, as there are numerous ways to profit from this trend. Two of the most popular are Nvidia (NVDA -1.55%) and Palantir (PLTR -0.58%), which represent two different sides of AI investing.

Nvidia is on the hardware side, while Palantir produces AI software. These are two lucrative fields to invest in, but is there a clear-cut winner? Let’s find out.

Palantir’s business model is more sustainable

Nvidia manufactures graphics processing units (GPUs), which have become the preferred computing hardware for processing AI workloads. While Nvidia has made a ton of money selling GPUs, it’s not done yet. Nvidia expects the big four AI hyperscalers to spend around $600 billion in data center capital expenditures this year, but projects that global data center capital expenditures will increase to $3 trillion to $4 trillion by 2030. That’s a major spending boom, and Nvidia will reap a substantial amount of money from that rise.

However, Nvidia isn’t completely safe. Its GPUs could fall out of style with AI hyperscalers as they develop in-house AI processing chips that could steal some of Nvidia’s market share. Furthermore, if demand for computing equipment diminishes, Nvidia’s revenue streams could fall. That’s why a subscription model like Palantir is a better business over the long term.

Palantir develops AI software that can be described as “data in, insights out.” By using AI to process a ton of information rapidly, Palantir can provide real-time insights for what those with decision-making authority should do. Furthermore, it also gives developers the power to deploy AI agents, which can act autonomously within a business.

Palantir sells its software to commercial clients and government entities, and has gathered a sizable customer base, although that figure is rapidly expanding. As the AI boom continues, these customers will likely stick with Palantir because it’s incredibly difficult to move away from the software once it has been deployed. This means that after the AI spending boom is complete, Palantir will still be able to generate continuous revenue from its software subscriptions.

This gives Palantir a business advantage.

Nvidia is growing faster

Although Palantir’s revenue growth is accelerating, it’s still slower than Nvidia’s.

NVDA Revenue (Quarterly YoY Growth) data by YCharts

This may invert sometime in the near future, but for now, Nvidia has the growth edge.

One item that could reaccelerate Nvidia’s growth is the return of its business in China. Nvidia is currently working on obtaining its export license for H20 chips. Once that is returned, the company could see a massive demand from another country that requires significant AI computing power. Even without a massive chunk of sales, Nvidia is still growing faster than Palantir, giving it the advantage here.

Nvidia is far cheaper than Palantir

With both companies growing at a similar rate, it would be logical to expect that they should trade within a similar valuation range. However, that’s not the case. Whether you analyze the stocks from a forward price-to-earnings (P/E) or price-to-sales (P/S) basis, Palantir’s stock is unbelievably expensive.

NVDA PE Ratio (Forward) data by YCharts

From a P/S basis, Palantir is about 5 times more expensive than Nvidia. From a forward P/E basis, it’s about 6.5 times more expensive.

With these two growing at the same rate, this massive premium for Palantir’s stock doesn’t make a ton of sense. It will take years, or even a decade, at Palantir’s growth rate to bring its valuation down to a reasonable level; yet, Nvidia is already trading at that price point.

I think this gives Nvidia an unassailable advantage for investors, and I think it’s the far better buy right now, primarily due to valuation, as Palantir’s price has gotten out of control.

Fintech, regtech, and cybersecurity vendor, CSI has teamed with HuLoop, a provider of an AI-powered, no-code automation platform, to help banks improve efficiency. The partnership will present CSI’s NuPoint Core Banking System to financial institutions, and is designed to help companies manage accounts, transactions, and other banking operations.

NuPoint customers will have access to HuLoop’s Work Intelligence platform, which is designed for community and regional banks. The solution is intended to help them address regulatory overheads and running costs.

Challenges in the sector include customer onboarding and document-based workloads that are prone to errors and can create approval bottlenecks. Employee fatigue from repetitive, low-value tasks in environments with strict compliance necessities can put strain on staff.

HuLoop’s approach combines humans and AI, where intelligent software agents oversee repetitive and mundane tasks. HuLoop’s Todd P. Michaud says, “Human-in-the-loop design ensures that automation enhances people’s work instead of replacing it. Community banks and credit unions are under pressure to grow without adding headcount at the same rate. By integrating HuLoop into CSI’s NuPoint ecosystem, we’re making it easier for institutions to deploy the power of AI automation quickly, securely, and in a regulator-friendly way.”

HuLoop’s no-code platform allows banks to streamline banking operations, unifying productivity discovery, process automation, workflow orchestration, document processing, and automated testing in lending and collection workflows.

Jeremy Hoard, EVP & Chief Banking Officer of Legends Bank, said “It’s helping us automate back-office tasks and improve operational efficiency, which allows our team to focus more on delivering exceptional service to our customers.”

The ultimate goal, according to Jason Young, vice president of product management at CSI, is to help banks get the most out of their core banking systems. “We’re extending NuPoint with proven AI-based automation capabilities that simplify operations […] and help institutions deliver exceptional service.”

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