AI Is The Next Big Thing. Here Are Some Of The Companies That Will Benefit From The AI Boom
By now, most of us will know that Artificial Intelligence (AI) is the next big thing.
If you still aren’t convinced, the AI sector is expected to contribute up to $15.7 trillion to the global economy in 2030, according to PricewaterhouseCoopers (PwC).
It is without a doubt that the AI sector will boom. But the question on everyone’s mind is, who will be the ones benefitting?
Let’s find out!
TL;DR: Artificial Intelligence Stocks – AI Companies That Will Potentially Benefit From The AI Boom
Just like the advent of the computer, the internet, and the smartphone, Artificial Intelligence is going to have a huge impact on our society. Right now, however, AI is still in its infancy, but here are some companies that could be big winners in the long run.
For the uninitiated, think of AI applications like productivity apps on your smartphone. They help you work better and more efficiently. And just like how Apple and Google take a cut for having apps available on their app stores, companies that have a direct hand in building such “app stores” or platforms, or building the technology behind them will thrive.
Disclaimer: The information provided by Seedly serves as an educational piece and is not intended to be personalised investment advice. Readers should always do their own due diligence and consider their financial goals before embarking on any investments or purchasing any investment products.
Nvidia (NASDAQ: NVDA)
If you’re a gamer, you’ll most likely know about Nvidia, the current leader in the Graphics Processing Unit (GPU) market. They produce some of the beefiest and most powerful graphics cards that support many gaming PCs.
But wait, what has Nvidia got to do with AI?
If you’re in the know, Nvidia also produces chips that give the raw processing power for AI software. And they are the leading chipmaker in the world based on production output!
Nvidia’s reach in AI technology also spans graphics processing units, high-performance computing systems, software, and cloud computing services.
On top of that, Nvidia has already laid out various AI initiatives to broaden its reach in AI such as partnerships and new products. They have announced partnerships with Google, Microsoft, and Oracle to name a few.
Things definitely look exciting for Nvidia with its CEO Jensen Huang even saying “We are at the iPhone moment of AI”.
Market Cap: US$696.79B
P/E ratio: 161.91
Microsoft (NASDAQ: MSFT)
It’s no surprise that Microsoft, the second most valuable company in the world, has been taking a huge interest in the field of AI.
It has a long partnership with OpenAI, the company behind the famous ChatGPT, and has invested a total of $13 billion dollars in them.
Microsoft has already begun incorporating AI into its software such as its Bing search engine and Edge browser, with many more software integrations to come.
Other companies are also scrambling to integrate their products with OpenAI, and that is great news for Microsoft given that OpenAI is running exclusively on Microsoft’s cloud server, Azure.
Market Cap: US$2.27T
P/E ratio: 33.10
Alphabet Inc. (NASDAQ: GOOGL)
But of course, if Microsoft is investing so much into AI, you can be sure that Google and its parent company, Alphabet, are doing the same. Despite the embarrassing showcase of its own chatbot, Bard, which caused stock prices to plunge 9 per cent following the event, Google is not slowing down when it comes to AI.
Much like Microsoft, Google seeks to integrate AI with its suite of products. If you’re using Gmail, you’ll already have come across some functions that utilise AI such as the Smart Compose or Smart Reply features that show you suggestions while typing your email.
It is also at the forefront of generative AI where technology is being used to create content.
Market Cap: US$1.34T
P/E ratio: 23.78
C3.ai Inc (NYSE: AI)
Unlike the more well-known companies above, this company is most likely alien to the average joe. C3.ai is a purely AI-focused company that offers AI software as a service (SaaS) to companies for their specific needs.
For example, oil and gas company Shell, utilises C3.ai’s technology to manage equipment and identify potential failures.
But just like any tech startup in its early stages, C3.ai has yet to turn a profit and its stock prices have been fluctuating very wildly. Even then, this is definitely a company you should keep a look out for if you are keen on the AI sector.
Market Cap: US$1.93B
P/E ratio: –
“Alexa, play despacito”
Despite Alexa, the virtual voice assistant being the most visible use of AI in its products, Amazon has something else more powerful up its sleeves. Enter Amazon Web Services (AWS), the largest cloud service provider in the world that makes Amazon the most money and provides a host of tools for any company that wants to develop AI applications in the cloud.
In addition to a strong platform, Amazon is diving headfirst into generative AI with Amazon Bedrock which provides a way to build generative AI-powered apps.
Market Cap: US$1.06T
P/E ratio: 251.25
AI Investment Trend
As always, remember to do your own due diligence on any company that you want to invest in, and make sure that they align with your investment goals.
Have an interesting AI company that you feel might be worth a look? Comment down below!