We recently published a list of Complete List of All AI Companies Under $2 Billion Market Cap. In this article, we are going to take a look at where Knightscope, Inc. (NASDAQ:KSCP) stands against other AI companies under $2 billion market cap.

It’s clear that AI holds immense promise but it comes with significant risks. Some of the concerns that the market has include overreliance on a few key players, shifts in demand toward smaller competitors, and the broader impact of AI-driven market trends on earnings and valuations. While AI offers opportunities, managing risks such as customer concentration, economic headwinds, and market volatility will be crucial for its sustainable growth and integration.

Navigating AI Expectations and Market Dynamics

On CNBC ‘Fast Money,’ a discussion between traders highlighted concerns about elevated expectations for AI, especially in the chip market, with NVDA as a prime example. Past patterns in the semiconductor giant’s stock suggest potential declines, with customer concentration being a significant risk. Some believe demand for high-end chips could shift to smaller semiconductor companies. They also discussed that broader market performance might improve as other sectors gain traction, especially during earnings season, which is expected to influence investor sentiment more than AI and GLP-1 trends.

They mentioned that the key risks for earnings include the strong U.S. dollar, rising rates, and policy uncertainties, which may impact large-cap companies. While recent PPI data offered some relief, the bond market remains firm, with 10-year yields approaching 5%. Expectations for CPI and PCE figures are mixed, with potential reacceleration seen as a headwind for markets in a higher rate environment. Earnings and economic data were considered critical factors to watch by the traders.

Our Methodology

For this article, we scoured our database as well as several ETFs and media reports to find all possible AI stocks under $2 billion. We then listed the stocks in ascending order of their market cap. We also added the hedge fund sentiment around each stock which was taken from Insider Monkey’s database of 900 hedge funds.

Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 275% since May 2014, beating its benchmark by 150 percentage points (see more details here).

A technician adjusting a human-machine interface in a laboratory surrounded by indoor multi-terrain robots.

Knightscope, Inc. (NASDAQ:KSCP)

Market Capitalization: $52.2 Million

Number of Hedge Fund Holders: N/A

Knightscope, Inc. (NASDAQ:KSCP) designs and deploys autonomous security robots (ASRs) for various sectors in the U.S. Its products include the K3, K5, K1, and K7 ASRs, which use sensors and lasers to navigate environments autonomously for security tasks. The company also provides security and network operations centers for real-time monitoring and data analysis, as well as Knightscope+, a virtual monitoring and response service. Knightscope’s AI-powered solutions are used in industries such as airports, healthcare, education, government, and commercial properties to enhance security and operational efficiency.

Knightscope (NASDAQ:KSCP) announced securing 10 new client agreements within the first 10 days of 2025 for its AI-driven ASR and emergency communication devices. One agreement came from an automotive group in Dallas, Texas, which signed a two-year deal for Knightscope’s K5 ASR to address vandalism, theft, and unauthorized access, opting for the K5 instead of additional fixed cameras. Knightscope also received new and expansion orders for its K1 ECDs, totaling 29 units across Georgia, Massachusetts, Texas, and Virginia.

The devices will advance communication in various locations, including municipalities, colleges, and counties. Additionally, existing clients in Florida, Massachusetts, New Jersey/New York, and North Carolina expanded their deployments, while longtime partner National Safety Systems replenished its inventory of K1 Blue Light Towers in anticipation of future demand.

Overall, KSCP ranks 45th on our list of AI companies under $2 billion market cap. While we acknowledge the potential of KSCP as an investment, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than KSCP but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.

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Disclosure: None. This article is originally published at Insider Monkey.