Small and Mid-Cap AI Stocks to Watch in 2025
AI has been one of the biggest tech advancement of our century, it specially has been making waves since 2022 after launch of ChatGPT by OpenAI which take over so many users in a very short time becoming most quickly adopted product ever.
The success of OpenAI, which remains a privately held company, has prompted investors to seek other AI opportunities. For those looking to invest in AI, there are many options available, as all major tech giants have significant involvement in artificial intelligence development. For example, Microsoft has heavily invested in OpenAI and is integrating AI into its product suite through Office 365 Copilot. Amazon is developing its cloud computing capabilities while working with OpenAI competitors like Anthropic and exploring chatbot technology beyond Alexa. Nvidia has emerged as a crucial player by providing the specialized semiconductors needed to train and run AI models, giving them a significant advantage over competitors like AMD. Meanwhile, Salesforce is incorporating AI assistants across its enterprise applications, developing a hybrid pricing model that combines subscriptions with usage-based pricing.
For investors seeking opportunities beyond the tech giants, here are 10 small and mid-cap companies to keep on your radar in 2025. These innovators are leveraging AI across diverse industries, including business process automation, cybersecurity, voice technology, and transportation safety. With market capitalizations ranging from $7.3 billion to $100 million, these companies are carving out unique niches by addressing specific industry challenges with specialized AI solutions. Below is an overview of these companies, their AI focus, and their current market capitalization:
UiPath ($PATH) Market Cap: $7.3B
- Developed a significant partnership with OpenAI to integrate GPT models into their automation platform
- Known for their “Automation Hub” which helps organizations identify and prioritize automation opportunities
- Their AI Computer Vision technology can recognize and interact with screen elements even when traditional selectors fail
- Recently expanded into process mining to automatically discover automation opportunities
SoundHound AI ($SOUN) Market Cap: $4.7B
- Uses proprietary Speech-to-Meaning® technology that processes speech and intent simultaneously
- Has notable partnerships with major automotive manufacturers like Mercedes-Benz and Hyundai
- Their restaurant voice ordering system has been adopted by major chains like White Castle
- Differentiates itself by offering fully custom wake words and branded voice experiences
C3.ai ($AI) Market Cap: $4.0B
- Founded by tech veteran Tom Siebel of Siebel Systems fame
- Offers pre-built applications for specific industries, including fraud detection and inventory optimization
- Has a strategic partnership with Microsoft Azure and Google Cloud
- Known for their Model-Driven Architecture that accelerates AI development
Verint Systems ($VRNT) Market Cap: $1.6B
- Their Da Vinci AI technology powers automated quality management for contact centers
- Offers real-time agent assistance that can suggest responses during customer interactions
- Has developed sophisticated emotion detection in their speech analytics
- Specializes in workforce engagement management integrated with AI capabilities
Innodata ($INOD) Market Cap: $1.0B
- Provides specialized medical document annotation services for healthcare AI
- Offers synthetic data generation for training AI models
- Has developed automated content classification systems
- Works with major tech companies to improve search engine accuracy
BigBear.ai ($BBAI) Market Cap: $0.8B
- Strong presence in defense and intelligence communities
- Provides maritime analytics for shipping optimization
- Uses AI for supply chain risk prediction
- Specializes in decision support for complex military operations
Evolv Technologies ($EVLV) Market Cap: $0.5B
- Their systems can process up to 3,600 people per hour
- Uses multi-sensor fusion technology combining different types of sensors
- Offers facial recognition integration options
- Has deployed at major sports venues and theme parks
Rekor Systems ($REKR) Market Cap: $0.1B
- Developed vehicle recognition technology that works in adverse weather conditions
- Offers emergency vehicle preemption systems
- Provides automated parking enforcement solutions
- Uses edge computing for real-time processing
AirShip AI ($AISP) Market Cap: $0.1B
- Specializes in multi-language natural language processing
- Offers integration with popular messaging platforms
- Provides analytics for conversation optimization
- Focuses on low-code development tools for AI applications
Guardforce AI ($GFAI) Market Cap: >$0.1B
- Deploys AI-powered robots for temperature screening and mask detection
- Offers autonomous cleaning robots for commercial spaces
- Provides AI video analytics for crowd management
- Develops facial recognition systems for access control
This article is for informational purposes only and is neither investment advice nor a
solicitation to buy or sell securities. All investment involves inherent risks, including the total loss of principal, and past performance is not a guarantee of future results. Always conduct thorough research or consult with a financial expert before making any investment decisions. BBAE has no position in any investment mentioned.
