It’s been a week of earnings fireworks on Wall Street, with Meta (META), Microsoft (MSFT), and Robinhood (HOOD) smashing Q2 estimates and the next wave—Apple (AAPL), Coinbase (COIN), and Amazon (AMZN)—keeping traders glued to their screens. With the AI data center buildout and quantum computing chatter at a fever pitch, small-cap and penny stocks are setting up for major sympathy moves.
If you want to know what I’m looking for — check out my free webinar here!
Let’s break down my top penny stocks to watch for August 2025 and the market catalysts that could ignite big swings.
3 Top Penny Stocks to Watch in August 2025
| Stock Ticker | Company | Performance (YTD) |
|---|---|---|
| NASDAQ: APLD | Applied Digital Corporation | +12.88% |
| NASDAQ: RGTI | Rigetti Computing Inc | +3.47% |
| NYSE: BBAI | BigBear.ai Holdings Inc | +0.72% |
These aren’t stocks that I’m necessarily buying…
These are stocks that I’m watching.
Want the whole list of AI penny stocks?
10 Top AI and Quantum Computing Penny Stocks for August 2025
The following three picks I’m watching extra closely…
1. Applied Digital Corporation (NASDAQ: APLD): AI Data Center Provider with Big Catalysts
APLD surged over 30% after reporting a Q4 revenue beat and announcing its partner, CoreWeave (CRVW), exercised another major lease at the company’s Ellendale campus. This takes CoreWeave’s total contracted capacity to 400MW—potentially translating to $11 billion in revenue for Applied Digital.
“Applied Digital reported results in line with expectations, and the CoreWeave news confirms our prediction the entire facility would be leased,” noted Citizens analysts, who see potential for the stock to move much higher if all planned capacity is contracted.
Key Stats:
- Q4 2025 revenue up 41% YoY to $38M (beat consensus)
- Adjusted loss per share of $0.03 (narrower than expected)
- Stock up 68% YTD, +164% over 12 months
- CoreWeave deal, plus $5.4B in prior financing, puts APLD in the AI infrastructure big leagues
Trade Scenario:
- Bullish: Breakout and hold above $15 with high volume could trigger a new momentum wave, especially as traders chase AI data center names after META/MSFT earnings.
- Bearish: Failure to clear $15 could spark a pullback to $9 support.
Why Watch Now?
Microsoft and Meta just doubled down on AI infrastructure spend in their Q2 calls. With Amazon and Apple also set to ramp AI investment, the sympathy flows into data center penny stocks like APLD could be massive in August.
2. Rigetti Computing Inc (NASDAQ: RGTI): Quantum Comeback on Mega-Cap AI Hype
Rigetti (RGTI) is leading the quantum penny stock pack after posting a major technical breakthrough—99.5% fidelity for two-qubit gates on its modular system. That puts them within striking distance of error-corrected quantum computing, a long-awaited milestone for commercial adoption.
The stock soared 40% in late July, riding a wave of quantum hype—fueled further when Microsoft’s CEO Satya Nadella called quantum “the next big accelerator” in the cloud during MSFT’s blockbuster earnings call.
“The next big accelerator in the cloud will be quantum, and I’m excited about our progress,” Nadella told analysts, sparking sector-wide momentum.
Key Stats:
- YTD: +1,000% (RGTI, QBTS and other quantum names are 2025’s top small-cap performers)
- Approaching key $20 resistance level
- Next earnings due Aug. 12; consensus EPS: -$0.05
Trade Scenario:
- Bullish: Breakout and close over $20 with heavy volume could fuel a new leg higher as quantum and AI continue to dominate headlines.
- Bearish: Failed breakout could see a sharp flush—look for dip buys at prior support ($13–15).
Why Watch Now?
RGTI is a sympathy play on mega-cap AI/quantum guidance. If Amazon, Apple, or other tech giants highlight quantum/AI investment in their calls, expect another round of volatility in quantum computing penny stocks.
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3. BigBear.ai Holdings Inc (NYSE: BBAI): The “Poor Man’s Palantir” with AI Defense Hype
BigBear.ai (BBAI) has become the budget-friendly alternative to Palantir (PLTR) for traders seeking AI/defense exposure. The company’s AI and analytics solutions are increasingly in focus as U.S. defense spending pivots to machine learning and automation.
BBAI’s stock doubled since May—even as fundamentals lag—thanks to recurring contracts and hype over AI-powered defense applications.
CNBC’s Jim Cramer recently called BBAI “your one speculation,” urging investors to keep bets small: “That’s only going to be your one speculation. Palantir would’ve been a better one to buy…but let’s limit our speculation to one stock.”
Key Stats:
- YTD: +65%
- Earnings due Aug. 11 (stock historically fades after reports, but sector momentum can override)
- Trading just under $8.50 resistance; 120% run since June
Trade Scenario:
- Bullish: Breakout and hold above $8.50 could attract new momentum buyers, with $10 as a psychological target.
- Bearish: Rejection could produce a sharp pullback to $6, offering dip-buyers another shot.
Why Watch Now?
AI defense contracts and speculation around Pentagon spending are catalysts for sympathy moves. If Palantir or other AI defense names spike after earnings, BBAI often follows.
Earnings Season: The Hidden Penny Stock Catalyst
With Apple, Amazon, and Coinbase all reporting this week, the market is laser-focused on growth and AI spending. Apple’s Q3 earnings just beat estimates—iPhone sales up 13% YoY, and Tim Cook says AI investment is “significantly growing.” Amazon also beat Q2 expectations, even as shares dipped on a cautious outlook. Coinbase missed on revenue and EPS, but the crypto sector remains red-hot for momentum traders.
Here’s why this matters for penny stocks:
- Sympathy plays are strongest when mega caps set the narrative. AI and cloud earnings fuel speculative runs in related small caps—especially in premarket and immediately after reports.
- Volatility is opportunity. Premarket runners like APLD, BGLC, SGD show that news and sector hype matter more than fundamentals in the short term.
- Discipline is key. Watch for confirmation and avoid chasing; most penny stocks give back gains fast if the setup fails.
Top Takeaways for August 2025
- Penny stocks like APLD, RGTI, and BBAI are “in play” thanks to AI and earnings catalysts.
- The best trades come on the front side of moves, especially when big tech earnings ignite sympathy runs.
- Sell into strength and protect your gains—these names can reverse fast.
- Have your watchlist ready for premarket action. Be nimble, be prepared, and never let hype override discipline.
After 20+ years in the trenches, my #1 rule hasn’t changed: Trade with a plan, not hope. I’ll only enter these names if they hit my preferred setups—breakouts on real volume, or panic dips with clear support.
This is stock news, not investment advice. Timothy Sykes News delivers real-time stock market news focused on key catalysts driving short-term price movements. Our content is tailored for active traders and investors seeking to capitalize on rapid price fluctuations, particularly in volatile sectors like penny stocks. Readers come to us for detailed coverage on earnings reports, mergers, FDA approvals, new contracts, and unusual trading volumes that can trigger significant short-term price action. Some users utilize our news to explain sudden stock movements, while others rely on it for diligent research into potential investment opportunities.
Dive deeper into the world of trading with Timothy Sykes, renowned for his expertise in penny stocks. Explore his top picks and discover the strategies that have propelled him to success with these articles:
- Penny Stocks Trading Guide
- Best Penny Stocks Under $1 to Buy Today
- Top 8 Penny Stocks to Watch on Robinhood
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