Artificial intelligence stocks have been all the rage so far through 2023. Without this group leading us higher, I’m not sure that mega-cap tech would have had the catalyst it needed to drive equities further this year. One area many investors have overlooked? AI stocks in entertainment.

The entertainment industry leans hard on technology, bringing the best ideas to light and allowing them to thrive. Now AI is working its way into every industry imaginable — and entertainment will be no exception.

If we frame the situation in that light, it forces us to look at AI-driven entertainment stocks.

Many stocks related to AI have seen huge rallies this year, so they may need time to cool off. Others haven’t had quite as big of an upturn. In either scenario, let’s look at a few AI stocks in entertainment.

AI Art Blends in With Entertainment: Adobe Systems (ADBE)

We wrote about Adobe Systems (NASDAQ:ADBE) several times, noting it as an under-the-radar AI stock. However, the secret appears to be out. Shares have now rallied in five straight weeks, gaining more than 50% from the May 12 low to the June 16 high.

The cherry on top was earnings, although the stock did fade from the initial period and only closed moderately higher on the day. Still, management drove home important points. They demonstrated solid results with a top- and bottom-line beat and issued solid guidance.

Barclays analyst Saket Kalia raised his price target on Adobe after the quarter. He also reasoned that the firm “has three ways to monetize its Firefly AI tool, which is used to edit photos: the use of Creative co-pilot, which could boost average revenue per user; additional engagement, which should driver higher retention; and lastly, Adobe (ADBE) can add paid users with a freemium model”.

AI Stocks in Entertainment: Nvidia (NVDA)

Seemingly everyone’s favorite AI stock, Nvidia (NASDAQ:NVDA), has gotten a lot of love lately. After shedding two-thirds of its value in the 2022 bear market, Nvidia shares have exploded to the upside. The stock has quadrupled off the lows, surging more than 300%.

The stock rallied hard into its mid-May earnings report, so many investors doubted how much it could grow after the results. While a top- and bottom-line beat did not surprise investors much, guidance was stunning.

Management said it expects second-quarter revenue of roughly $11 billion vs. consensus expectations of nearly $7.2 billion.

While shares trade at about 55 times this year’s earnings, it’s going to lead the AI movement. Plus, its products already help power game-makers, animators, and other entertainment creators.

King of Entertainment: Disney (DIS)

Last but not least, we have the king of entertainment with Disney (NYSE:DIS). This stock isn’t getting much love, down 54% from its all-time highs. For long-term buyers, that creates an opportunity.

While Disney is not exactly an exclusive artificial intelligence stock, it is one of the AI stocks in entertainment.

For instance, “Disney has already started using artificial intelligence (AI) in some areas of Disney World, such as the My Disney Experience app, which uses AI to provide personalized recommendations to visitors based on their interests and past behavior.”

Further, in its new Pixar film Elemental, animators used AI not only to help make part of the film actually work but also to reduce production time and cost. In the future, we could see more use of AI in its films. Not only will that speed up the production process, but it should help lower costs and expand the boundaries on creative direction.

On the date of publication, Bret Kenwell did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.