Sovereign AI is becoming a key investment focus on Wall Street, shifting attention from chatbot developers to the owners of data and infrastructure. Analyst Dan Ives identified Nvidia and Palantir as primary beneficiaries of this trend, which emphasizes keeping AI models and data under local control.
Nvidia CEO Jensen Huang advocates for national AI infrastructure, advising governments in India, Japan, France, and Canada to localize their data. Huang estimates the global infrastructure buildout could reach $85 trillion over 15 years. In July, he invested £500 million in the UK cloud firm NScale.
Palantir is implementing a similar strategy for enterprises. In June, the company partnered with Nvidia to launch a Sovereign AI Operating System, allowing businesses to train models on their own hardware. Palantir reported that its US commercial revenue grew 149% year over year in the second quarter of 2026.
Tom Lee, co-founder of Fundstrat, highlighted the risks of relying on external AI models, suggesting that dependence on foreign-controlled systems could lead to biased outcomes. Lee also noted that institutional investors still have significant opportunities to increase their exposure to the AI sector.
