On the surface, the artificial intelligence corner of the stock market appears robust right now, with the benchmark S&P Kensho Global Artificial Intelligence Enablers Index up 49.9% for the year to date, as of the first week of June.

Meanwhile, the top-performing AI and semiconductor exchange-traded funds (ETFs) have delivered massive year-to-date (YTD) returns, led by the iShares Semiconductor ETF (NASDAQ:SOXX), which is up approximately 92% YTD. Other leading AI-focused funds include the Invesco AI and Next Gen Software ETF (NYSE:IGPT), up 72.5%, and the Global X Artificial Intelligence & Technology ETF (NASDAQ:AIQ), which is up 36%.

Those figures leave little doubt that the AI boom has delivered extraordinary gains for investors over the past few years, with leading stocks and funds benefiting from surging demand for chips, software platforms, and infrastructure.

However, after massive rallies, some powerhouse tech industry names now trade at elevated valuations, leaving investors with limited margin of safety (whether they realize it or not). Consequently, savvy investors may consider locking in profits on strong performers amid risks like potential slowdowns in hyperscaler spending, competition, and high multiples.

Especially given the sell-off in tech and AI we saw on Friday.

Here are three solid AI stocks to take profits on now.

As usual on Wall Street, it’s all about the dollar bills, and some heavy hitters say those investors who take AI profits right now have a point.

“S&P 500 revenues have been growing by 10%, but profits have been rising faster, while operating margins have increased to roughly 16%, an all-time high,” states Fidelity Investments in a recent research note. “A lot of this growth has been driven by the technology sector, particularly AI development, yet this earnings expectations outperformance has been seen across market sectors. Moreover, earnings estimates are rising at a faster rate.”

With capital expenditures (CapEx) surging, Fidelity’s analysis noted that could pave the way for continued earnings growth, which could fuel an AI-driven “melt-up” in stocks.

“Since the launch of ChatGPT in late 2022, capital expenditures as a percentage of S&P 500 revenue have doubled to 9%, even as revenue has grown. Indeed, Alphabet (NASDAQ:GOOG), Amazon (NASDAQ:AMZN), Meta Platforms (NASDAQ:META), and Microsoft (NASDAQ:MSFT) have projected roughly $700 billion in spending on AI data center buildouts in 2026,” Fidelity noted.

Now that the costs to keep developing AI are skyrocketing,

With AI development costs skyrocketing in 2026, let’s eyeball three solid AI stocks where taking some profits could make sense right now.

NVIDIA Corp.

Trading at $214 in early June and trading up 17.2% for the year, NVIDIA (NASDAQ:NVDA) remains the undisputed leader in AI GPUs, powering much of the generative AI revolution with its Blackwell and upcoming architectures. The stock has delivered phenomenal returns, but now it’s facing some tough questions about whether the current hype fully prices in near-term growth.

For starters, Nvidia itself is increasingly growing anxious about burgeoning AI costs, with one internal engineering team reporting that AI costs are outrunning human worker costs. The chip giant also may face the regulatory wrath of Team Trump after reports that it may have taken advantage of a policy loophole that allowed Chinese companies like Alibaba to buy advanced Blackwell AI chips outside China.

In a rare occurrence, the U.S. Commerce Department’s Bureau of Industry and Security issued a May 31 (a Sunday) advisory reiterating that worldwide restrictions on AI chip sales to Chinese companies remain in effect, signaling potential oversight activity against Nvidia.

While Consensus remains strongly bullish, with a “Buy” rating from the vast majority of analysts (around 50 Buy/Strong Buy out of 53 consensus ratings). The average 12-month price target is around $305–$309, implying notable upside from recent levels near $218–$220. Recent calls from Needham and DA Davidson reiterated Buy ratings with targets around $270–$300 in early June 2026.

However, some voices highlight valuation risks and the need for continued “insane” returns on AI investments, as noted by CEO Jensen Huang. With the stock having multiplied significantly, some profit-taking should give NVDA investors a good chance to take a breath and reduce exposure as the AI cycle matures … and that process could take five to 10 years, some tech analysts say.

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Palantir Technologies

Trading at $141 and down 20.8% so far in 2026, Palantir (NASDAQ:PLTR) has emerged as a high-profile AI software play, with its platforms gaining traction in the enterprise and government sectors through deals with Google Cloud and major law firms. The stock has seen sharp gains on AI momentum but carries a premium valuation that some Wall Street analysts view as stretched.

The Aventura, Fla.-based software platforms heavyweight now looks like it’s set to become a litmus test for big software stocks, and President Trump’s June 2 executive order that tightened AI innovation and security rules (the EO focused on “software vulnerabilities” that needed to be examined) hasn’t helped, as the stock dropped 10% on the news.

Industry analysts also wonder if PLTR shares can keep pace with soaring AI costs. In a recent note, top investor Keithen Drury noted, “At nearly 100 times forward earnings, Palantir needs to triple its earnings beyond 2026’s results to get to a more reasonable valuation range.” Drury also noted that PLTR would require a 45% growth rate for three years for its valuation to pass muster.

“With growth through 2029 already baked into the stock, that’s just too great a price to pay,” Drury stated.

Despite optimism around commercial AI deals, caution stems from high multiples (often cited as over 100 times forward earnings in some analyses), insider selling, and comments from investors such as Michael Burry and Drury about sky-high valuations. For Palantir shareholders, taking profits now locks in gains from the AI hype while leaving ample room for growth evaluation down the road.

Super Micro Computer

Trading at $43 per share and up 47.6% year-to-date, Super Micro (NASDAQ:SMCI) has hit a rough patch of late, with shares falling over 6% in the first week of June as investors appear to be taking profits amid renewed pressure on momentum-driven technology stocks.

According to Benzinga analysis, Super Micro Computer is positioned to benefit from the growing demand for AI infrastructure. “(Yet) there are fundamental concerns that cloud deployment challenges, industry-wide component shortages, and increased competition could negatively impact the company’s performance in the near term,” the analysis noted.

Additionally, the company’s heavy reliance on a few large customers and potential legal risks could lead to less predictable sales and lower margins. “While DCBBS and software revenue are expected to drive long-term growth, there is still uncertainty surrounding the company’s operational questions and legal affairs,” the analysis concluded.

That all leads to downbeat expectations from Wall Street, which may trigger another selloff in SMCI shares. 

According to additional Benzinga analysis, with an average price target of $38 among Mizuho, Mizuho, and Barclays, this implies a -12.67% downside for Super Micro Computer Inc from the most recent analyst ratings.