Generally speaking, tech stocks are crushing the competition in 2023. It’s old news by now, but a select few stocks are responsible for a resurgent Nasdaq. That said, rather than debating this reality, it’s clearly important that investors understand that mega-cap stocks are embracing AI, and driving significant gains right now.

It’s not only these companies that are embracing artificial intelligence. The entire world is. Thus, the time for debating whether investing in AI is a good idea has passed. The business opportunities are too great, and the potential productivity gains too appealing.

AI is likely to be the most disruptive technology perhaps in our lifetimes. That suggests investors have to stay abreast of AI innovations and news related to the key tech stocks driving the discussion in this sector right now.

Nvidia (NVDA)

On the basis of returns alone, it’s undeniable that Nvidia (NASDAQ:NVDA) has crushed its competition in terms of embracing AI. Shares of NVDA stock have soared from less than $150 to $390 per share in less than six months. That’s essentially all due to AI and surging investor interest in this space.

By now it’s old news – Nvidia blew previous sales projections out of the water, as AI chip demand has reached a fever pitch. Nvidia released earnings on May 25 that set the AI world on fire. The $7.2 billion Wall Street had been expecting as Q2 guidance proved wildly low. Instead, Nvidia projected $11 billion in sales for the second quarter as a result of generative AI demand truly taking off.

Nvidia’s semiconductors are the leading AI chips used by most companies in this space. The problem, if it can be called that, is that Nvidia can’t keep up with demand. The company must work around the clock to fulfill demand, suggesting that supply could once again come into focus for investors in the quarters to come. Of course, this is a problem most companies wish to have, but here we are.

Notably, NVDA stock has continued its trek higher following this earnings upgrade. Updated analyst ratings suggest it could rise higher even without any further positive news. That’s the kind of momentum investors want to see.

Microsoft (MSFT)

Microsoft (NASDAQ:MSFT) has turned up the dial on its competitors, in the race to bring utility to users in the high-growth AI space. Microsoft landed the first punch back in January when it kicked off the third phase of its OpenAI investment. That stage of investment was valued at $10 billion, and increased its total investment to $13 billion in this company known for its large language model, ChatGPT.

The announcement focused on supercomputing at scale, AI experiences utilizing the cloud, and the exclusive cloud relationship between OpenAI and Azure. Those ideas were relatively vague at the time, but it soon became clear that Microsoft would integrate OpenAI’s ChatGPT functionality into its Bing search engine. The logic there was that it represented an opportunity to claw away some of the search business market from Alphabet’s (NASDAQ:GOOG) Google search engine.

Additionally, ChatGPT really started to gain prominence around that time. It wasn’t until months later that Google released a legitimate product to contend with it. Some of the hype has died down, but Microsoft remains the same titan it has always been, only with an advantage in AI and an early lead in AI software integrations.

Alphabet (GOOG)

Alphabet, as noted, was something of a laggard relative to its primary competitor, as AI exploded into the public consciousness this year. Make no mistake about it though, Alphabet is doing everything it can to harness the power of AI.

CEO Sundar Pichai even famously stated on 60 Minutes that he believes AI is the most profound technology humanity has ever worked on. He actually made that statement back in 2018, only to repeat it again this April.

Alphabet is all in on AI to be sure. Bard is Google’s answer to ChatGPT. But it’s only part of what Google is doing. Other examples include AI toolkits that allow users to build generative AI applications and prototype ideas without machine learning skills.

If Alphabet started out as a laggard, it has essentially caught up to Microsoft now after adding Labs to the Chrome desktop. Big tech is very likely to get even bigger with the advent of AI.

On the date of publication, Alex Sirois did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.