Wedbush: The Big Three US Tech Giants Will Compete for the First Membership in the $4 Trillion Club in AI
Intelligible Finance learned that Apple (AAPL.US), Nvidia (NVDA.US) and Microsoft (MSFT.US) seem to be the obvious leaders in the AI spending race, with Wedbush expecting one of the seven tech giants to reach a $4 trillion market cap in the next six to nine months. Apple currently has a $3.56 trillion market cap, followed by Nvidia's $3.23 trillion and Microsoft's $3.11 trillion.
Analysts led by Daniel Ives at Wedbush made some bold and optimistic predictions about the future of AI spending and infrastructure. Ives said in an investor note: "We believe the opportunity for the entire AI infrastructure market could grow 10x from today to 2027 as the next generation of AI infrastructure is built. We estimate AI Capex will be $1 trillion over the next three years."
As Nvidia's chips become the foundation of AI computing, its position in large infrastructure spending is solidified. Wedbush sees Microsoft as another core driver of AI. Following these two companies, the next wave of beneficiaries will include Apple, AMD (AMD.US), Dell (DELL.US), IBM (IBM.US), Oracle (ORCL.US), Palantir (PLTR.US), Salesforce (CRM.US) and ServiceNow (NOW.US).
Ives added: "In short, we believe tech stocks will rise another 20% by 2025 as this tech bull market enters the next phase led by the AI revolution."
Apple's opportunities
Apple is now set to capitalize on consumer demand for AI with its latest products such as the iPhone 16 and the new iPad mini with its own AI feature Apple Intelligence. Despite some bearish reports and shipment tracking showing that iPhone demand is lower than previous releases, Wedbush expects iPhone sales to soar this holiday season.
Ives added: "We continue to see further signs in the Asian supply chain that this iPhone upgrade cycle could be historic, setting the foundation for a super cycle as we currently estimate there are about 300 million iPhones globally that have not been upgraded in over four years. In our view, as the AI-driven upgrade cycle begins, Apple's iPhone sales in FY25 could exceed 240 million units."