Internet stocks in the United States, including Datadog DDOG, Alphabet GOOGL, Shopify SHOP and Paylocity Holding PCTY, look set for a constructive second half of 2026, as enterprises move agentic AI from pilot projects into daily operations across the Internet economy. Gartner forecasts worldwide spending on AI platforms and services to reach $2.52 trillion in 2026, a 44% jump from last year, and that wave of budget is flowing directly into Internet-native cloud application vendors, search platforms and customer-experience software makers, giving Internet companies a direct line to fresh enterprise dollars rather than leaving the gains to chipmakers.
Cloud reacceleration is the clearest boost for Internet stocks. Azure, AWS and Google Cloud have posted growth rates north of 25% this year, and rising backlog figures across these Internet platforms suggest AI workloads are finally converting from commitments into billed revenues.
Internet software leaders like Salesforce and ServiceNow are layering autonomous AI agents onto existing subscription products, a shift Grand View Research values within a broader agentic AI market projected to grow from $7.6 billion in 2025 to $10.9 billion in 2026. That trajectory should lift Internet stock valuations by supporting premium subscription pricing and stickier renewals.
Internet infrastructure and security names stand to benefit too, as traffic-based businesses sitting close to the Internet's core plumbing see early signs that agentic AI usage, not just human browsing, is becoming a meaningful new demand driver for their networks.
Digital advertising is another quiet lift for Internet stocks, with AI-driven ad tools now used by a growing share of major advertisers, expanding monetizable Internet surface area for search and social platforms without requiring new inventory.
Risks remain around capex scrutiny and valuation resets after a volatile first half, but broadening AI adoption across the Internet stack leaves these stocks tied to productivity, commerce and cloud well placed to close 2026 on firmer footing.
Our Picks
Here, we have selected four tech stocks that are well-poised to grow in the rest of 2026, driven by their strong fundamentals. These stocks also have the favorable combination of a Growth Score of A or B and a Zacks Rank #1 (Strong Buy) or 2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Per Zacks’ proprietary methodology, stocks with such a favorable combination offer solid investment opportunities.
Year-to-Date Performance
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Datadog's near-term outlook appears constructive, supported by a deepening competitive moat and accelerating product innovation. Company guidance targets full-year 2026 revenues of $4.30-$4.34 billion, reflecting sustained enterprise demand for cloud-native observability and security. As of first-quarter 2026, approximately 4,550 customers carried $100,000-plus ARR, up 21% year over year, evidencing robust platform adoption and customer wallet expansion. At DASH in June 2026, Datadog launched 100+ new capabilities, headlined by a fully autonomous Bits AI suite — independently detecting, investigating and remediating production issues — alongside AI Guard for agentic security. The late-June acquisition of Adaptive ML, a pioneer in Reinforcement Learning Operations, expands its proprietary AI research program. A newly achieved FedRAMP High certification further unlocks the federal government as an additional meaningful revenue opportunity.
This Zacks Rank #1 stock has a Growth Score of B. The Zacks Consensus Estimate for 2026 earnings has moved upward by 2.1% to $2.41 per share over the past 60 days.
Alphabet is entering an accelerated AI monetization phase with compelling near-term fundamentals. At Google I/O in May 2026, the company unveiled Gemini 3.5 and Gemini Omni, marking a decisive shift to agentic workflows, with over 8.5 million developers building on its models monthly. Google Cloud's backlog stood at over $460 billion, with approximately 50% convertible to revenues within 24 months. In June 2026, Alphabet upsized its equity raise to $84.75 billion — including a $10 billion Berkshire Hathaway placement — earmarked for AI infrastructure. Management guided 2026 capex at $180-$190 billion to meet unprecedented, growing customer demand. Waymo surpassed 500,000 autonomous rides weekly, while management guided a positive FX tailwind for second-quarter 2026. These fundamental factors position Alphabet constructively for near-term upside.
This Zacks Rank #2 stock has a Growth Score of B. The Zacks Consensus Estimate for 2026 earnings has moved north by 0.2% to $14.32 per share over the past 60 days.
Shopify presents a compelling near-term opportunity anchored in durable fundamentals and strategic momentum. The company's second-quarter 2026 guidance calls for high-twenties revenue growth and mid-teens free cash flow margins, reflecting broad-based platform strength across geographies, merchant sizes and channels. The Spring '26 Edition, unveiled June 2026, introduced 150+ platform updates, including the Shopify Catalog API, Universal Commerce Protocol and agentic storefronts, positioning Shopify as the infrastructure layer for AI-driven commerce. Monthly Recurring Revenue reached $212 million through expanding merchant solutions. In June 2026, the board raised its share repurchase authorization to an aggregate of $5 billion, signaling confidence in cash generation. A consistent 15% free cash flow margin reinforces Shopify's ability to invest in growth while returning capital to shareholders.
This Zacks Rank #2 stock has a Growth Score of B. The Zacks Consensus Estimate for 2026 earnings has moved up by 1.7% to $1.83 per share over the past 60 days.
Paylocity's expanding platform strategy positions it well for near-term growth. The June 2026 launch of Paylocity Retirement, embedding Vestwell's technology directly into its HCM suite, deepens the platform's stickiness and broadens its addressable revenue per client. The April 2026 acquisition of Grayscale Labs further strengthens AI-powered recruiting capabilities, augmenting a product suite already spanning HCM, Finance and IT. The April launch of Elevate Solutions — combining the unified platform with dedicated operational HR and payroll expertise — addresses scalability needs across its roughly 42,000 clients. Updated 2026 guidance anticipates fourth-quarter recurring revenue growth of approximately 9-10% year over year, underpinned by a trailing free cash flow margin of 24.4% and a board-approved $1.35 billion share repurchase authorization, signaling durable financial confidence.
This Zacks Rank #2 stock has a Growth Score of B. The Zacks Consensus Estimate for 2026 earnings has increased 1.8% to $8.09 per share over the past 60 days.
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Alphabet Inc. (GOOGL): Free Stock Analysis Report
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Shopify Inc. (SHOP): Free Stock Analysis Report
Datadog, Inc. (DDOG): Free Stock Analysis Report
This article originally published on Zacks Investment Research (zacks.com).