Artificial intelligence has slowly moved from a science fiction topic to something that has a huge impact on peoples livelihoods and the world around us. Still, its common for many companies to use AI as a simple buzzword. But it would be a mistake to think that AI is just jargon though.

At this point, the power of artificial intelligence is growing exponentially. As such, look for AI-driven technologies to make a massive impact over the next decade. That will, of course, have a major effect on the stock market. Right now, many tech investors are primarily focused on cloud and software-as-a-service stocks. And with good reason those have been booming.

But with all the data accumulating online, its only a matter of time until more powerful AI turns that data into new understanding and new profits. Heres seven stocks to harness the power of artificial intelligence in your portfolio.

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Alphabet (NASDAQ:GOOG, NASDAQ:GOOGL) is far from a pure play on artificial intelligence. The company still pays the bills with search advertising, after all. And its dominant Android operating system will continue reaping rewards for Alphabet for many years to come.

That said, if you want a company that undoubtedly will be a major part of artificial intelligence in coming years, look no further. Google launched Google AI in 2017 as a separate entity to show the importance of AI to the companys future.

Already, Alphabet has made moves with DeepMind, its roughly 700-employee division that has achieved things such as beating humans at the board game Go. Recently, Alphabets artificial intelligence topped humans in deciphering ancient Greek text. Turning to more practical matters, Google is using AI to help customers solve important although perhaps mundane tasks such as filling in online forms automatically or responding better and faster to voice-inputted questions.

All this plays back into Alphabets core products, as well. The better Google Search is, for example, the more advertising revenue Google will be able to bring in. Artificial intelligence is at the core of GOOGL stock, and its further advances in the field should help power profits across the companys other lines of business.

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International Business Machines (NYSE:IBM) isnt having a great year. Its not had a great past five years in fact. IBMs stock price has stagnated as the company has struggled to adapt to a changing tech market. The companys hugeRed Hat acquisition will be critical in trying to get its cloud division going again.

That said, while IBM has had its struggles, you cant deny its excellent positioning in AI. IBMs Watson is one of the most exciting applications. Not only does it have its high-profile appearances, such as competing in game shows and chess matches, it is also being used for chat applications, healthcare, weather prediction and assisting teachers.

As Watson is able to answer questions in natural language, the range of potential uses is immense. And IBM is constantly upgrading Watsons capabilities. Just this week, it added new functionality to Watson Assist, Watson Discovery and a drift function that can show when the AIs prediction is moving away from actual real world results.

Some investors have grown fed up with IBM, and its not hard to see why. In a raging bull market IBM stock has offered little besides its dividend. But dont let bad past performance make you write off the companys technology. Watson could emerge as a leading AI asset in coming years.

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Like IBM,Nvidia (NASDAQ:NVDA) has had a rather forgettable past 12 months. NVDA stock peaked at $290 a share last year, and is almost a full $100 below that now, even after the recent rally. Investors havent necessarily made a mistake either. Nvidia has faced plenty of pressure between the fall in crypto-related demand, the trade war and a general glut of inventory in some of its main product lines.

This severe-but-temporary weakness in main business lines is giving investors a chance to get in on Nvidias artificial intelligence story at a reasonable price, however.

Nvidias deep learning AI offers a great deal of promise. For now, it focuses on self-driving vehicles a major strength for Nvidia in general. Over time, however, Nvidia is aiming to create an ecosystem based around Nvidia GPUs where developers can combine many deep learning concepts into their AI solutions that span various industries. Nvidia will need to demonstrate more success and revenues from automotive AI-driven sales first. But if and when it does, expect investors to take notice and bid NVDA stock back up again.

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Texas Instruments (NASDAQ:TXN) has some similarities with the previous pick, Nvidia. Both are diversified semiconductor companies that are making a big push in the automotive market. Texas Instruments already has a huge position in autos, via its sensors and processing chips that convert real-world conditions into digital data. That position, along with its wide array of analog chips, has given Texas Instruments one of the most profitable and sustainable businesses in the semiconductor space.

In particular, for those looking for AI stocks, consider Texas Instruments. Its Sitara family of ARM processors enable deep learning. Sitaras have been on the market for a few years now and clients have already incorporated them into applications ranging from smart snow goggles to video players, and Lego programmable robots. Whats most exciting is Texas Instruments place in Googles Nest, a smart thermostat capable of becoming more aware over time as it acquires more data.

Even the giants stumble, however. TXN stock fell sharply following Tuesdays earnings report where the company low-balled forward guidance. That gives investors with a long-term horizon an opportunity. Following the earnings decline, TXN stock is selling at just 24x forward earnings. Thats the cheapest its shares have been in awhile and makes for a nice entry point.

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CrowdStrike (NASDAQ:CRWD) has had an eventful few months. The company completed its initial public offering in June, and CRWD stock started trading around $60. Traders soon bid it up to $100 on the back of strong earnings and jaw-dropping revenue growth rates.

Things went south in a hurry though. People have been dumping SaaS stocks since September, and Crowdstrike has gotten hit hard. Some analysts are worried about political concerns as well. CrowdStrike helped provide security services to the Democratic National Committee following its 2016 hack. The led to President Donald Trump calling out CrowdStrike during his call with Ukraine. CrowdStrikes CEO said it was a surprise that the company has been dragged into the political circus and that the firm is only focused on customers security.

Regardless, all this noise has created a strong opportunity to pick up a leading AI stock on a steep discount. While plenty of companies do cybersecurity, CrowdStrike has an innovative approach. Its software uses deep machine learning to not only identify threats, but also learn from each attempted attack. Over time, CrowdStrikes AI evolves and becomes more sophisticated as it encounters more and more hacking attempts. Combine that with multiple endpoint security CrowdStrike can defend a user across all their devices and the company has a large and growing lead against other cybersecurity firms. With CRWD stock down nearly 50% since its recent highs, this AI stock is on sale.

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Not surprisingly, the other huge cloud hosting company is also a leading AI play. Thats right, Microsoft (NASDAQ:MSFT) has a major position in the future of artificial intelligence as well. While Microsoft has missed other major computing trends in the past, under current management, it seems to be much more adept at seeing the future rather than reacting as change happens.

Whats that mean for Microsoft and AI specifically? Good question. Microsoft has aimed to give its customers the first access to human-equivalent level intelligence across a growing number of fields. Microsoft claims to have achieved this sort of AI parity in machine language translation, object detection and speech recognition. Over time, Microsoft expects to be able to broaden its reach to more and more crucial fields.

Of course, rivals like Google would dispute Microsofts leadership in these capabilities. However, Microsoft has a huge advantage over its competition due to Azure. It has access to more data than anyone other than, arguably, Amazon (NASDAQ:AMZN). This gives Microsofts scientists a huge treasure trove of information to process. Its not hard to imagine Microsofts AI becoming the dominant player in coming years.

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A credit card issuer probably isnt the first place youd go looking for artificial intelligence investments. Make no mistake, though, there will be big winners from smart AI applications outside of tech companies. Look no further than Discover Financial Services (NYSE:DFS).

Earlier this year, Discover announced that it has partnered withZest AI (formerly known as ZestFinance) to create a leading credit scoring platform. Through AI the companies are creating a system that will automatically score consumers by credit riskiness and learn from the models underwriting successes and failures over time. Using a growing pile of historical data, a sophisticated AI algorithm should be able to find certain patterns and trends that humans have so far overlooked.

Discovers CEO minced no words in explaining why the company is making such a huge push into AI credit modeling. He said, Banks that fail to invest in machine learning will end up fundamentally uncompetitive in a couple of years. For investors in DFS stock, you could be surprised by the benefits as Discover pulls ahead of less technologically savvy rivals. At less than 9x forward earnings, the price is certainly right to invest in this financial firm.

At the time of this writing, Ian Bezek owned IBM, TXN, CRWD and DFS stock. You can reach him on Twitter at @irbezek.

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7 AI Stocks to Buy to Profit from the Recent Tech Correction - Investorplace.com