This Is the Most Obvious AI Stock to Own for the Next Five Years. And No, It's Not Palantir.

Key Points

Alphabet benefits from artificial intelligence (AI) through distribution.

AI strengthens Alphabet’s existing business model rather than replacing it.

The opportunity isn’t obvious to most investors, for good reasons.

• 10 stocks we like better than Alphabet ›

When investors think about artificial intelligence (AI), they often gravitate toward the most visible names -- companies building cutting-edge models, selling artificial intelligence software, or riding the latest wave of hype. That's why many immediately point to Palantir Technologies.

But if you step back and think about how value actually gets created in major technology shifts, a different answer emerges. The most obvious AI stock to own over the next five years may not be the most exciting one.

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It may be a boring company like Alphabet (NASDAQ: GOOGL) (NASDAQ: GOOG). Not because it dominates headlines, but because it sits at the center of where AI is already in large-scale deployment.

Alphabet owns the distribution layer of AI.

Most AI companies are still trying to acquire users. Alphabet already has them -- at a global scale. For perspective, billions of people use Google Search, YouTube, Android, Chrome, Gmail, and Maps every day. These products are deeply embedded in how users access information, communicate, and consume content.

That matters because AI creates value when it gets integrated into products people already use, not when it exists as a stand-alone feature. To this end, Alphabet doesn't need to convince users to adopt AI. It integrates AI directly into existing workflows:

• Improving search results
• Enhancing recommendations on YouTube
• Adding intelligence to Android devices

By contrast, enterprise companies like Palantir must expand usage through enterprise contracts, which typically takes time to scale. In technology, distribution often determines how quickly a company can create value. On that front, Alphabet starts far ahead of its peers.

Alphabet can monetize AI across existing businesses.

Most AI companies have one thing in common: rapidly growing user bases but massive losses as they are still figuring out how to sustainably monetize them. Unlike these companies, Alphabet already has established revenue engines. AI only enhances them further.

For example, in Search, AI can improve relevance and help match digital ads with higher-intent queries. On YouTube, better recommendations can increase engagement, which supports advertising and subscription growth. In Cloud and Workspace, AI tools are becoming part of enterprise offerings, creating new revenue opportunities.

Unsurprisingly, Alphabet continued to report solid growth in 2025, with revenue up by 15%. In particular, Google Cloud reported 48% revenue growth, suggesting growing demand for its AI solutions. The key point is this: AI is not a separate business for Alphabet. It is an upgrade across multiple existing businesses.

Still, that doesn't mean monetization is guaranteed or immediate. In fact, AI introduces real trade-offs, especially in search, where fewer clicks could reduce traditional ad inventory. But Alphabet has multiple levers to adapt, including new ad formats, improved targeting, and potentially introducing Ads in its own AI chat service (Gemini).

Why is this opportunity not obvious to most investors?

If Alphabet is so well-positioned, why isn't it universally viewed as the top AI stock? One thing is that the company doesn't capture as much attention as the up-and-coming players like OpenAI or Palantir. After all, it's already a large conglomerate with "limited" growth opportunities.

Besides, there are concerns that AI could disrupt search economics. Others may prefer smaller companies with faster growth potential. And many are drawn to pure-play AI stories that offer clearer upside narratives.

But those views can overlook how large platforms can capture value from AI over time. After all, Alphabet doesn't need to reinvent its business. It just needs to evolve, and it has already begun doing so.

What does it mean for investors?

Alphabet may not be the most exciting AI stock on the market. It doesn't have bold projections or a solid narrative-driven momentum. Still, it may be one of the most structurally advantaged thanks to its massive scale and the huge opportunity to monetize its AI services.

For long-term investors, that combination is hard to ignore. After all, AI is not an end in itself but a means to an end -- creating sustainable, long-term shareholder value.

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Lawrence Nga has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Alphabet and Palantir Technologies. The Motley Fool has a disclosure policy.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.