With inflation, interest rate debates and energy shocks all pulling markets in different directions, investors are looking for clearer, more focused ideas. The AI Small Caps screener targets smaller companies that are building early-stage tools in areas such as machine learning, automation and data intelligence. These companies are at a stage where growth potential can still be influenced by new products and adoption. This article highlights 3 stocks from that screener, giving you a curated starting list to research if you want AI exposure without only relying on the largest global tech stocks.

SharonAI Holdings (SHAZ)

Overview: SharonAI Holdings runs high performance computing and AI infrastructure platforms that bundle powerful GPUs, storage, networking and automation into a single cloud-like service for AI labs, hyperscalers, research institutions and heavily regulated industries, with a focus on its own and partner data centers in key locations such as Australia.

Operations: SharonAI currently generates about US$1.54 million in revenue from High Performance Compute Services, entirely from customers in the United States.

Market Cap: US$1.88b

Investors are watching SharonAI Holdings because it sits at the center of the AI compute build-out, with ambitions to deploy tens of thousands of NVIDIA Grace Blackwell GPUs across new AI factories in Australia and a cloud infrastructure footprint that is being scaled with partners like VAST Data and NEXTDC. Forecast revenue growth is described as extremely fast, supported by recent multi-year agreements and sizeable private financings, but this comes with clear trade-offs, including ongoing losses, earnings forecasts that point to further deterioration and a balance sheet heavily reliant on external borrowing. The board and management team are still very new, and the share price has been highly volatile. As a result, SharonAI may be more suitable for investors who are prepared to undertake detailed research and who have a higher tolerance for risk.

SharonAI’s rush to scale high performance GPUs and AI factories is eye catching, but the real story lies in how the projected revenue surge aligns with analyst forecasts for SharonAI Holdings in a way that could reshape the risk profile, and this is something most investors have not yet pieced together.

Pagaya Technologies (PGY)

Overview: Pagaya Technologies uses proprietary AI models and a large data network to help banks, fintechs and other lenders make more accurate credit decisions, routing declined or complex loan applications to its platform so more borrowers can be approved while partners keep the loans off their own balance sheets.

Operations: Pagaya generates around US$1.33b in revenue from its Software & Programming segment, reflecting fees from its AI underwriting and network services.

Market Cap: US$1.55b

Pagaya Technologies is on many investors' radar because it sits at the intersection of AI and consumer credit, using its underwriting engine to support a growing list of bank and fintech partners, while issuing large volumes of asset backed securities to recycle capital. The company has recently become profitable. Analysts expect strong earnings growth, helped by higher margin AI decisioning and a capital light model, even though revenue growth is projected to be more moderate. On the other hand, Pagaya relies on external funding instead of deposits, operates in a competitive market and faces regulatory and model risk around AI driven lending. That mix of potential upside and real execution risk is one reason some investors are taking a closer look.

Pagaya Technologies is already profitable, yet its AI driven underwriting story still feels only half told, and the real twist sits inside the analyst forecasts for Pagaya Technologies, which may reveal what the current margins are quietly hinting at.

SoundHound AI (SOUN)

Overview: SoundHound AI builds independent voice AI systems that let cars, call centers, restaurants and connected devices talk to customers in natural language. It uses its Houndify tools, Chat AI assistants and agentic OASYS platform to power real time, multi channel conversations backed by its own speech recognition, language understanding and analytics stack.

Operations: SoundHound AI generates about US$184 million in revenue from Internet Software & Services, with roughly US$122 million coming from the United States and the remainder from other markets and segment adjustments.

Market Cap: US$3.01b

SoundHound AI is drawing interest because it sits at the heart of voice enabled customer interactions, with its OASYS agentic AI platform, restaurant ordering agents and automotive assistants already deployed across telecoms, utilities and thousands of store locations. Revenue is forecast to grow faster than the broader US market, and recent awards and the planned LivePerson acquisition indicate a potential for a larger enterprise footprint and more recurring, software-like revenue streams. At the same time, the company is still loss making, heavily funded by external capital and filing for a US$300 million equity raise. As a result, execution on margins, cash burn and integration risk may matter as much as top line growth, and that tension is where many of the key considerations lie.

SoundHound AI’s push into voice agents and the LivePerson deal hints at a bigger shift, and the real tell is buried inside the analyst forecasts for SoundHound AI, where the trade off between scale and dilution begins to look different.

The three AI stocks in this article are just a starting point, and the full AI Small Caps screener surfaces 25 more small cap companies with equally compelling AI driven narratives that you have not seen yet. Use Simply Wall St to identify, analyze and filter for the specific catalysts, balance sheet strength and growth stories that align with your highest conviction AI small cap playbook.

Take Control of Your Investment Journey

If SoundHound AI or any of these companies have caught your attention, register for FREE with Simply Wall St and add your companies to a Watchlist to monitor the share price against the fair value and track any new developments as they happen. Once you've made your move, manage your holdings with our Portfolio Command Center that filters out the noise to deliver only the most critical, actionable updates. Throughout your journey, our Community allows you to filter the best ideas from thousands of investor perspectives. By uncovering hidden catalysts and risks early, you'll accelerate your decision-making and stay one step ahead of the market.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.