Microsoft (NASDAQ: MSFT) is a king of reliability, known for its consistent financial and stock growth. Over the last five years, the company’s share price has risen 200%, while free cash flow has climbed 92%.

Microsoft’s steady growth has secured it a market cap above $3 trillion, allowing it to remain in the world’s top three most valuable companies. In fact, from about February to June of this year, Microsoft temporarily surpassed Apple and Nvidia (NASDAQ: NVDA) in market cap, taking the top spot.

Market fluctuations have seen the world’s top five most valuable companies reshuffle multiple times in 2024. Even throughout August, Nvidia and Microsoft have been duking it out for second place on an almost weekly basis. Meanwhile, Amazon (NASDAQ: AMZN) appears to be on a bull run that could surpass the Windows company in the coming years.

Nvidia and Amazon have been on exciting growth paths thanks to skyrocketing earnings. These companies dominate their respective industries and are profiting from consistent investment in the lucrative artificial intelligence (AI) market.

While Microsoft is known for consistency, Nvidia and Amazon are expanding at a rate that could allow them to overtake the company. So, here are two growth stocks I predict will be worth more than Microsoft in five years.

1. Nvidia: A meteoric rise that is unlikely to slow any time soon

Nvidia’s business has delivered record growth since the start of 2023, with its stock up 779%. Its meteoric rise has seen it steadily climb through the ranks of the world’s most valuable companies, as seen in the chart below.

As of this writing, Nvidia’s market cap is above Microsoft’s. Their positions switched multiple times this month, suggesting could swap again by the time you read this. However, Nvidia is included in this list as I’d argue that it will have surpassed Microsoft for good and gained a solid lead within the next five years.

Nvidia massively outperformed Microsoft in 2024, with its stock up 159% compared to Microsoft’s 10% rise. Meanwhile, Nvidia’s quarterly revenue is up 18% year to date, with Microsoft’s up 4%. At this rate, Nvidia could even secure its spot ahead of Microsoft much sooner than five years.

Nvidia’s stellar gains are primarily thanks to its dominance in AI. The company is responsible for between 70% and 95% of all AI graphics processing units (GPUs), the chips necessary for training AI models. Competitors like Advanced Micro Devices and Intel are working to catch up, launching rival GPUs this year. However, Nvidia’s head start and $39 billion in free cash flow (compared to AMD’s $1 billion and Intel’s negative $13 billion) suggests it won’t have too much trouble maintaining its lead.

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In AI, Microsoft has a prominent role in cloud computing. However, fellow cloud giants Amazon and Alphabet are much closer competitors than Nvidia’s rivals in the GPU market.

Nvidia will report its second quarter of fiscal 2025 earnings on Aug. 28. After over a year of beating quarterly earnings, the company will likely continue recent trends and deliver another quarter of impressive growth. Its stock could soar, furthering its lead on Microsoft.

2. Amazon: Soaring earnings and the cash to surpass its rivals

Amazon and Microsoft are in steep competition in the cloud industry. As of Q2 2024, Amazon Web Services (AWS) cloud market share stood at 31%, while Microsoft Azure’s was at 25%. However, Amazon ramped up its cloud investment over the last year, which could allow it to hold onto its lead in the industry and eventually push its market cap above Microsoft’s.

Amazon consistently outperformed Microsoft over the last year. Solid growth in retail and AWS has seen Amazon’s profits soar, allowing it to sink billions into its AI efforts.

In March, Bloomberg reported that Amazon plans to spend nearly $150 billion on data centers over the next 15 years to expand AWS’ reach. The company anticipates an explosion of demand for AI applications and other digital services, requiring a more extensive cloud network. The news aligns with multiple reports in recent months that announced Amazon’s data center investment in U.S. locations including Ohio, Indiana, and Virginia, as well as international spots such as Singapore, Spain, Saudi Arabia, India, and Taiwan.

The expansion will increase Amazon’s cloud and AI capabilities. Meanwhile, a vast network will allow it to boost other areas of its business with the generative technology, such as e-commerce, grocery, digital advertising, and more.

Amazon’s market cap currently sits at $1.8 trillion. However, its earnings and stock are expanding at a rate that will likely see it overtake Microsoft in the coming years.

Should you invest $1,000 in Nvidia right now?

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Suzanne Frey, an executive at Alphabet, is a member of The Motley Fool’s board of directors. John Mackey, former CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool’s board of directors. Dani Cook has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Advanced Micro Devices, Alphabet, Amazon, Apple, Microsoft, and Nvidia. The Motley Fool recommends Intel and recommends the following options: long January 2026 $395 calls on Microsoft, short August 2024 $35 calls on Intel, and short January 2026 $405 calls on Microsoft. The Motley Fool has a disclosure policy.

Prediction: 2 Growth Stocks That Will Be Worth More Than Microsoft in 5 Years was originally published by The Motley Fool