Wedbush: NVIDIA and Microsoft Leading the AI Revolution, US Tech Stocks Bull Market Entering a New Phase

Zhitong
2024.09.30 13:34
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Wedbush Securities analyst Dan Ives pointed out that NVIDIA and Microsoft continue to lead the way in the artificial intelligence (AI) revolution. It is expected that by 2027, the AI infrastructure market will grow tenfold. AI-related spending is driving the technology supply chain, with enterprises launching AI projects frequently, expected to become a focal point of IT budgets by 2025. Ives predicts that tech stocks will rise by over 10% by the end of the year and another 20% by 2025

According to the Zhitong Finance and Economics APP, in the view of Wedbush Securities, NVIDIA (NVDA.US) and Microsoft (MSFT.US) continue to lead the artificial intelligence (AI) revolution. New evidence suggests that from now until 2027, the artificial intelligence infrastructure market may grow tenfold.

Wedbush analyst Dan Ives stated: "Under the leadership of AI pioneer Jensen Huang and NVIDIA, the demand for AI chips in the supply chain is unprecedentedly high. With the explosive growth of AI use cases in enterprises, it will eventually trigger a wave of corporate spending. We believe that with the establishment of the next generation of AI infrastructure, the opportunity for the entire AI infrastructure market may grow tenfold from now until 2027. We estimate that AI capital expenditures will reach $1 trillion in the next three years."

Ives mentioned that AI-related spending is driving most of the technology supply chain expenditures, with generative AI projects in enterprises being launched regularly. This indicates that AI-related projects and initiatives will be at the forefront of IT budgets in 2025, potentially unlocking many previously unseen AI use cases.

Ives added: "While NVIDIA and Microsoft are currently the core drivers of AI, we see many other tech giants joining the AI camp, including Oracle (ORCL.US), ServiceNow (NOW.US), Palantir (PLTR.US), Salesforce (CRM.US), Dell (DELL.US), IBM (IBM.US), Apple (AAPL.US), AMD (AMD.US), and others." "In short, we believe that as the AI revolution leads the bull market of US tech stocks into the next phase, tech stocks will rise by over 10% by the end of the year and another 20% in 2025."

Ives stated that for every $1 spent on NVIDIA GPUs, the entire tech industry generates a multiplier effect of $8 to $10. While NVIDIA has changed the global landscape with its GPUs, AMD and other companies are catching up, just in time for the wave of $1 trillion in AI capital expenditures in the coming years.

Ives further commented: "Our research indicates that as use cases explode across the entire enterprise domain, the demand for large-scale enterprise AI is entering the next stage."

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