If I Could Buy and Hold Only 1 Artificial Intelligence (AI) Stock Through a Democratic Congress, It Would Be This One

The 2026 midterm elections have introduced a layer of uncertainty for artificial intelligence (AI) investors. With Democrats winning control of both chambers of Congress, lawmakers are preparing to introduce legislation addressing AI safety, electricity costs, and the expansion of data centers across the United States.

For companies such as Nvidia (NASDAQ: NVDA), Microsoft (NASDAQ: MSFT), Amazon (NASDAQ: AMZN), Alphabet (NASDAQ: GOOGL) (NASDAQ: GOOG), Meta Platforms (NASDAQ: META), Tesla (NASDAQ: TSLA), and Space Exploration Technologies (NASDAQ: SPCX), the implications could be significant.

Much of the AI revolution has been driven by investments in semiconductors, cloud computing, and data center infrastructure. There's one technology giant pursuing a different strategy. If I could buy and hold just one AI stock throughout the next two years of a divided government, I'd consider Apple (NASDAQ: AAPL). Let's dig into why.

Image source: The Motley Fool.

Apple's AI strategy is different from its competitors

Most of the largest AI developers are spending unprecedented sums of money building AI infrastructure. Nvidia supplies the graphics processing units powering these facilities, while Microsoft, Amazon, Alphabet, and Meta are investing hundreds of billions of dollars each year to expand their computing capacity. Tesla is also spending heavily on autonomous driving and robotics.

Apple is taking a different approach. Rather than competing to build data centers, Apple is focused on bringing AI capabilities directly to its existing products. This includes integrating generative AI features into the iPhone, the Mac, and Siri, while relying on partners for additional computing capabilities.

The financial implications of this strategy are compelling. During fiscal 2026, Apple's capital expenditures (capex) declined 29% to roughly $9 billion. Meanwhile, research and development (R&D) spending increased 32% to $45.8 billion, reflecting continued investment across software and AI.

The takeaway here is that Apple is investing heavily in innovation without committing nearly as much capital to physical AI infrastructure as its hyperscaler peers. That difference could become important if Congress pursues legislation that makes building new data centers more difficult.

Why Apple looks more resilient to AI regulation

Data centers consume enormous amounts of electricity and water, raising questions about utility costs, environmental impacts, and whether local communities should shoulder the financial burden of new development. Many Democratic lawmakers are indicating that they intend to pursue additional oversight when the new Congress convenes.

It's important to note that President Donald Trump retains veto authority, meaning sweeping federal restrictions are not guaranteed. Nevertheless, even the possibility of tighter regulation introduces uncertainty for big tech.

Slower data center construction could affect demand for Nvidia's chips. For cloud services providers such as Amazon, Microsoft, and Alphabet, new restrictions could hinder expansion plans and make budgeting more challenging.

By contrast, Apple already has a global installed base across billions of devices through which it can push AI-powered features. Rather than building an entirely new customer ecosystem, Apple can introduce updated capabilities to people who already own its products. This creates a unique opportunity to encourage device upgrades, strengthen customer loyalty, and potentially expand its budding services business.

Apple's cash flow is the biggest reason to own the stock

While Apple's AI strategy is interesting, the company's underlying financial performance is what makes the investment thesis compelling. During its fiscal fourth quarter (ended Sept. 26), Apple generated $114.5 billion in revenue, representing 12% growth year over year.

iPhone revenue increased 17% to $57.6 billion, while services revenue reached $31.6 billion. These figures illustrate an important point: Apple does not need AI to become an entirely new business segment overnight.

AAPL Free Cash Flow data by YCharts

The company's existing products and services already generate meaningful revenue, providing management with the financial flexibility to invest in emerging technologies without jeopardizing the core operation. Moreover, Apple's relatively modest capex profile allows it to preserve more cash for dividends, share repurchases, and future product innovation.

While the next two years could bring changes to the regulatory environment surrounding AI, Apple stands out because the company doesn't need to win the AI infrastructure spending race to benefit from the technology. It just needs to make AI useful enough that consumers continue buying its products and paying for its services.

For investors, that flexibility is especially valuable. That's why Apple is my top buy-and-hold AI stock in the current political landscape.

Adam Spatacco has positions in Alphabet, Amazon, Microsoft, Nvidia, and Tesla. The Motley Fool has positions in and recommends Alphabet, Amazon, Apple, Meta Platforms, Microsoft, Nvidia, Space Exploration Technologies, and Tesla. The Motley Fool has a disclosure policy.