2 Artificial Intelligence (AI) Stocks to Buy Before They Soar Under President Trump
News Summary
The article suggests that Nvidia and Meta Platforms are poised to benefit from President Trump's "One Big Beautiful Bill Act." This legislation permanently sets the corporate income tax rate at 21% and repeals the mandatory amortization of domestic research and development (R&D) spending, allowing immediate deduction of these costs. These provisions are expected to boost the companies' profit margins and tax savings. Nvidia reported robust fiscal 2026 second-quarter results with sales growing 56% to $46.7 billion, driven by strong performance in its data center and automotive segments. Demand for its new Blackwell GPU is extraordinary, reinforcing its leadership in AI infrastructure. Furthermore, the Trump administration recently reversed export restrictions on Nvidia's H20 GPU to China and may allow sales of a scaled-back Blackwell version, opening new growth avenues. Meta Platforms delivered impressive second-quarter financials, with revenue up 22% to $47.5 billion and operating margin expanding. As the world's second-largest ad tech company, Meta leverages its extensive social media ecosystem (Facebook, Instagram, WhatsApp) and uses AI to enhance user experience and engagement. The company is also exploring new monetization opportunities, including advertising on Threads and WhatsApp, and its Meta AI application, with over 1 billion monthly active users, presents significant future revenue potential.
Background
As of 2025, Donald J. Trump has been re-elected as the US President in November 2024 and is currently in office. His administration's agenda, particularly its economic and tax policies, directly impacts the operating environment for American corporations. The "One Big Beautiful Bill Act" mentioned in the article represents his government's latest tax reform initiative, building upon achievements from his first term's 2017 Tax Cuts and Jobs Act (TCJA). The 2017 TCJA reduced the corporate income tax rate from 35% to 21%, a change that was initially temporary. The new act makes this rate permanent, providing long-term tax certainty for businesses. Simultaneously, repealing the mandatory amortization rule for R&D expenses signals the government's intent to encourage innovation and technological investment, especially in high-tech sectors like Artificial Intelligence. In the AI landscape, Nvidia and Meta Platforms are central players. Nvidia leads in AI chips and computing infrastructure, with its GPUs being critical for data centers and autonomous driving. Meta Platforms, through its vast user base, advertising technology, and AI investments, drives its social media and metaverse businesses. US government export control policies, particularly those targeting China, significantly influence the global strategies and revenues of chip manufacturers like Nvidia, making any policy shifts highly impactful.
In-Depth AI Insights
Beyond direct tax benefits, how might the Trump administration's policies strategically impact the long-term competitive landscape for AI leaders like Nvidia and Meta? - The permanent low corporate tax rate and immediate R&D deduction not only boost short-term profitability but also free up substantial cash flow. This enables tech giants to sustain large-scale share buybacks, support stock prices, and significantly increase investments in core AI technologies and infrastructure, further widening their lead over smaller competitors. - The easing of export policies to China, particularly for Nvidia's GPUs, could be a strategic tool to balance US tech companies' commercial interests with national security concerns. This move not only reopens a critical market for Nvidia but may also set a precedent for other restricted US tech firms, influencing the restructuring and competitive dynamics of global tech supply chains. - In the long run, such a