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The stock market continued to churn out high returns in the third quarter, with all of the major indexes reaching all-time highs.

The S&P 500 generated at return of 7.8% in the quarter, fueled by strong corporate earnings despite tariff pressures and lower interest rates.

Here are the top three performing S&P 500 stocks in Q3.

1. Western Digital, up 104%

Western Digital (Nasdaq: WDC) is a leading provider of storage solutions for data centers, specializing in hard disk drives and solid-state drives.

The boom in AI has created high demand for data centers to process and store all of that high-capacity data. Western Digital is riding that boom as one of two leaders in hard disk drive storage for data centers, along with Seagate Technology (Nasdaq: STX). The two companies control about 80% of the market, which gives them a duopoly. This is a tremendous position to be in for both companies, as the demand for data centers is not slowing down.

Western Digital’s dominant market share in a high-growth business helped it generate a return of 104% in the third quarter, the best on the S&P 500. The stock returned about 47% in September alone. Western Digital stock is currently trading at $135 per share, up 199% year-to-date. It also has a very reasonable forward P/E ratio of 19, which makes even more attractive.

2. AppLovin, up 98%

One of the newest members of the S&P 500, Applovin (Nasdaq: APP) is also one of its best performers. Applovin was added to the index in the latest rebalancing on the strength of its 98% return over the past three months.

AppLovin provides mobile app developers with a platform on which to market, monetize, and analyze the performance of their apps. The platform also uses AI to help advertisers find the right customers, or users, for their ads.

The firm has been an earnings juggernaut. In Q2, revenue spiked 77% to $1.26 billion while net income rose 164% to $820 million.

AppLovin also got a boost when it sold off its mobile gaming business in July for $400 million to focus on its more lucrative ads business and non-gaming customers.

AppLovin stock is up 111% YTD trading at $683 per share and just got a massive price target upgrade from BofA to $860 per share. It has a high P/E, but it has massive growth potential and is one to watch.

3. Warner Bros. Discovery, up 75%

Warner Bros Discovery (Nasdaq: WBD) stock took off for two main reasons. One, it split the company in two, with the movie and streaming businesses on one side and the TV business on the other. This streamlined operations but also set it up for potential divestment or acquisition. That’s the second reason the stock is up.

There have been reports that suitors are lining up to buy all or some of the company. While nothing has happened yet, the rumors have fueled the stock price gains. WBD stock is up 81% YTD.

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