Small-cap AI stocks like C3.ai, Upstart, and SoundHound are gaining traction with real-world applications and strategic partnerships.
Sectors & Industries
June 26, 2025
Table of Contents
Small-cap AI stocks offer a dynamic mix of innovation and growth potential, often outperforming larger firms in emerging areas like automation, quantum computing, and intelligent financial services. Below are six standout companies operating in this market range, along with their latest product updates and strategic moves.
Market Cap: ~$4.27 billion
BILL uses AI to automate financial operations for small and midsize businesses, including accounts payable, receivable, and expense management. In Q2 2025, it launched new forecasting and anomaly detection tools to enhance real-time cash flow visibility. Most notably, BILL introduced an AI-powered procurement module unifying procure-to-pay workflows in a single platform positioning itself as a “CFO Command Center.”
BILL also partnered with Xero to provide embedded bill pay services, allowing U.S. users to automate payments directly from Xero’s platform. These advancements, along with features like mass pay and multi-entity management, solidify BILL’s role as a top fintech innovator in AI-driven back-office solutions.
Market Cap: ~$3.66 billion
SoundHound builds AI-powered voice assistants used in vehicles, smart devices, and restaurants. In 2025, it launched the Lucid Assistant with Lucid Motors, expanded to brands like Alfa Romeo and Peugeot, and introduced customizable “Brand Personalities” for automakers. It also debuted in-vehicle voice commerce at CES 2025, allowing drivers to order food hands-free.
In partnership with NVIDIA, SoundHound showcased generative AI that runs fully offline in vehicles—delivering fast, private, and cloud-free performance. The company is also expanding beyond automotive into healthcare and enterprise customer support, further establishing itself as a leader in conversational AI.
Market Cap: ~$3.15 billion
C3 AI provides an end-to-end AI platform for enterprise applications across energy, manufacturing, and defense. In 2025, it launched the C3 Agentic AI suite, enabling autonomous AI agents to retrieve data, analyze it, and take action across industries.
Key 2025 developments include a $450 million contract expansion with the U.S. Air Force for its PANDA maintenance system and new partnerships with ExxonMobil, Dow, and Bristol Myers Squibb. C3 also extended joint ventures with Baker Hughes and formed alliances with Microsoft, PwC, and Arcfield to boost go-to-market reach. Its generative AI capabilities and defense wins positioned it as a high-conviction AI enterprise play.
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Market Cap: ~$6.55 billion
UiPath is modernizing robotic process automation by integrating agentic AI into enterprise workflows. In 2025, it launched a next-gen automation platform featuring UiPath Maestro and Agent Builder, allowing AI agents, bots, and humans to work in sync.
The company partnered with Google Cloud to build medical document summarization agents using Gemini LLMs and signed global EMR agreements to embed automation in hospital systems across 16 countries. UiPath also joined forces with HCLTech to co-develop industry-specific automation solutions. These moves reinforced UiPath’s AI leadership in healthcare and enterprise automation.
Market Cap: ~$2.35 billion
QCI is pioneering the intersection of quantum computing and AI. In 2025, it won a NASA Langley contract to analyze satellite LIDAR data using its Dirac-3 quantum computer and partnered with the Sanders Tri-Institutional Institute for quantum-assisted drug discovery.
The company also completed its quantum photonic chip foundry and secured pre-orders from Spark Photonics and Alcyon Photonics. With its unique photonic technology gaining recognition from NVIDIA and its growing footprint in aerospace and biopharma, QCI is emerging as a serious quantum-AI contender.
Market Cap: ~$4.95 billion
Upstart uses AI to assess credit risk, replacing FICO scores with machine learning models. In 2025, it secured $1.2 billion in loan funding from Fortress Investment Group and expanded a $2 billion partnership with Blue Owl Capital.
The company also enhanced its Auto Retail software with instant AI-powered loan approvals and introduced new products like small-dollar relief loans and HELOCs. Upstart hosted its first AI Day to spotlight its foundation model for credit underwriting, now used by over 100 bank and credit union partners. These developments restored investor confidence and repositioned Upstart as a leader in AI-driven lending.
These small-cap AI firms combine focused innovation with real-world applications across finance, logistics, quantum science, and enterprise operations. Investors seeking early exposure to tomorrow’s AI leaders may find compelling opportunities in this sector.
Disclaimer: This article is for informational purposes only and does not constitute financial advice. Always conduct your own research before making investment decisions.
Before investing, consider the unique risks of small-cap AI stocks:
Risk Management Tips:
Small-cap AI stocks between $2B and $10B in market cap offer a unique blend of growth potential and emerging innovation. While companies like SentinelOne, Tempus AI, IonQ, C3.ai, and Nebius are still scaling, their AI-focused platforms position them to benefit from rising enterprise demand, cloud infrastructure growth, and healthcare innovation.
Investors seeking exposure to the AI revolution—without chasing mega-cap valuations—should keep these names on their radar.
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Among small-cap AI stocks, C3.ai (NYSE: AI) is considered one of the most promising due to its full-stack enterprise AI platform, government contracts, and expansion into generative AI. It remains a standout pure-play in a sector increasingly adopted by large corporations.
While no stock is guaranteed to "skyrocket," Nebius Group (NBIS) has shown the most rapid growth so far—up over 270% post-IPO—due to explosive demand for its GPU-powered AI infrastructure services. However, it also carries high risk due to its debt load.
Symbotic (SYM) is among the most stable and scalable AI automation stocks. It partners with major retailers like Walmart and Target, and its AI-driven warehouse robotics systems are seeing accelerating adoption globally.
Top small-cap AI stocks in the $2B–$10B range for 2025 in terms of popularity include:
The term “$3 AI Wonder stock” is often used by marketing emails or newsletters to tease a low-priced AI stock. As of mid-2025, SoundHound AI (SOUN) is trading near that price range and fits the profile—being a small-cap, high-growth voice AI company.
Based on a balance of growth, revenue performance, and risk, Tempus AI (TEM) and C3.ai (AI) are strong contenders. Tempus leads in healthcare AI, while C3.ai offers diversified enterprise applications with government and industrial backing.
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