We recently compiled a list of the 11 Best Self-Driving Car Stocks to Buy According to Analysts. In this article, we are going to take a look at where Microsoft Corporation (NASDAQ:MSFT) stands against the other self-driving car stocks.

The term “self-driving car stocks” describes publicly traded businesses engaged in creating, manufacturing, or using autonomous vehicle technology. These businesses either directly contribute to the development of self-driving systems or offer crucial parts and services to the autonomous driving industry.

The autonomous vehicle market is booming. Grand View Research estimates that the global market for autonomous vehicles was worth $68.09 billion in 2024 and is projected to grow at a compound annual growth rate (CAGR) of 19.9% from 2025 to 2030. The industry is driven by the significant demand for tech adoption by customers, road safety, connectivity, advancements in AI, and sensor technology. In 2024, the passenger vehicle segment led the industry and accounted for 69% of the global revenue. The North American autonomous vehicle market dominated the global market with a share of over 37.1% in 2024.

On the other hand, according to Goldman Sachs Research, Level 3 autonomous cars, which permit hands-off, eyes-off driving in some situations, might make up as much as 10% of new cars sold globally by 2030, down from a previous estimate of 12%. It is anticipated that level 4 fully autonomous vehicles will account for 2.5% of sales, up from 3.5% in the past. Vehicles classified as Level 2 and Level 2+, which need to be supervised, are projected to rise from 20% at present to 30% by 2027. Adoption is expected to speed up due to AI advancements and declining hardware prices, notwithstanding delays caused by technological, legislative, and business model obstacles. By 2030, a market for robotaxis valued at over $25 billion would develop, driven by commercial AV fleets. By 2030, the cost of an AV mile might be less than $1, and by 2040, it could be $0.58. Long-term, AVs may account for 60% of new light vehicle sales worldwide by 2040, with China dominating (90%), followed by Europe (80%), and the United States (65%).

As per S&P Global’s report, the industry’s focus on self-driving cars has changed from lofty Level 5 autonomy to practical, incremental applications. Tech firms and manufacturers came together at CES 2025 with realistic objectives, especially in the area of Level 4 autonomy. Companies increasingly prefer deployable technology, such as ride-hailing services and automated shuttles, above completely autonomous personal vehicles. Leading this shift is Waymo, which reports more than 4 million trips overall and 150,000 paid rides weekly. It displayed new Hyundai and Zeekr automobiles, growing its business in additional American cities and adjusting to local laws. These actions show ride-hailing’s scalability in light of the present limitations.

Meanwhile, conventional automakers showcased autonomous shuttle concepts, while Level 2+ and Level 3 ADAS systems continue to be used in consumer vehicles. As startups with specialized inventions, like AI chips or sensor software, work with larger companies that have the resources and manufacturing capacity, partnerships are growing. Smaller players struggle to operate on their own because of high R&D expenses and regulatory complexity. As the market transitions from hype to practical implementation, Level 4 geo-fenced applications and delivery systems are expected to be the next big thing. The autonomous future is increasingly defined by gradual, cooperative progress rather than disruptive leaps.

A development team working together to create the next version of Windows.

Methodology

For this list, we thoroughly reviewed reputable sources and compiled an initial list of 20 self-driving stocks. Then we selected the 11 stocks that had the highest upside potential as of April 22, 2025. We have only included stocks in our list with an upside potential of 14% or higher. The stocks are ranked in ascending order of the upside potential.

Note: Not every company included in the list is solely focused on self-driving technology. Some of the stocks highlighted below are involved indirectly by investing in businesses that specialize in autonomous driving.

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).

Microsoft Corporation (NASDAQ:MSFT)

Analysts’ Upside Potential as of April 22: 31.58%

Microsoft Corporation (NASDAQ:MSFT) is one of the top developers and suppliers of support software, services, devices, and solutions. The business continues to grow through its notable progress in cloud services, such as Azure AI and Copilot, and artificial intelligence.

The firm is collaborating with several top automakers to expedite automation advancements. Wayve, a London-based startup pioneering deep learning for autonomous vehicles, and Wejo Group Limited, a leader in linked vehicle data, are two well-known partners of Microsoft Corporation (NASDAQ:MSFT). It is among the Best Autonomous Driving Stocks.

Shares underperformed in the first quarter of 2025 as Azure revenue growth fell short of analyst projections, which was the third quarter in a row that this segment saw some degree of disappointment. Nonetheless, sales growth tied to AI surpassed projections and accounted for 13% of Azure’s quarterly growth. In addition, management highlighted increased operating profitability and reduced tax rates while maintaining their fiscal third-quarter earnings estimate. Analysts are still optimistic that Microsoft Corporation (NASDAQ:MSFT) can maintain its position as the industry leader in AI, even after a challenging quarter.

The firm’s cloud sales topped $40 billion in the second quarter of 2025, a 21% year-over-year growth that shows the company’s sustained dominance in cloud services. Microsoft Corporation (NASDAQ:MSFT)’s AI division has also experienced remarkable expansion, with a yearly revenue run rate of nearly $13 billion, up 175% from the previous year, due to the extensive enterprise deployments of AI technologies. Commercial bookings also hit a record high, rising 67% overall, or 75% in constant currency. This was mostly due to OpenAI’s significant Azure commitments, which significantly exceeded projections.

Overall, MSFT ranks 7th among the 11 Best Self-Driving Car Stocks to Buy According to Analysts. While we acknowledge the potential of self-driving car companies, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns, and doing so within a shorter time frame. There is an AI stock that went up since the beginning of 2025, while popular AI stocks lost around 25%. If you are looking for an AI stock that is more promising than MSFT but that trades at less than 5 times its earnings, check out our report about this cheapest AI stock.

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