Wedbush Securities said that based on the performance of Microsoft (MSFT.US) and AMD (AMD.US) and others, investors should be reassured that the concerns about AI monetization for a few companies are overblown.
Analyst Dan Ives said, “Over the past few weeks, we have also seen CEOs and CIOs accelerate their AI strategies from our customer/partner dialogue, all of which is driven by these budgets and ROI.”
Ives added that the performance of Microsoft and AMD “further reinforces the monetization stage of AI.” He urged investors to focus on the comments from Apple (AAPL.US), Amazon (AMZN.US), Alphabet, ServiceNow, Palantir and Microsoft, and said they should consider these companies “as core barometers.”
Ives explained: “The cloud computing infrastructure of companies like Microsoft, Google and Amazon is rock solid, and we expect more companies to embark on the cloud and AI journey over the next 12 to 18 months.”
“We have seen the massive AI capabilities of ServiceNow and Palantir, two companies that are playing a role in the next stage of enterprise AI deployment, which further provides the AI puzzle for Wall Street. On the front end, AMD is now riding the crest of a wave from a $1 trillion AI market with a growing capital expenditure, and we expect Nvidia, the ‘AI guru,’ to lead this trend over the next few years.”
Nvidia is scheduled to report its quarterly earnings on August 28, with analysts generally expecting revenue of $28.54 billion and earnings per share of $0.64.