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Tech bull run not over yet as AI revolution set for next stage

AuthorYasin Ebrahim
Published 04/04/2024, 05:00 PM
Updated 04/04/2024, 05:00 PM
© Reuters

Investing.com -- The rally in tech stocks isn't likely to end anytime soon as the upcoming quarterly earnings season will highlight the next phase of the artificial intelligence revolution beyond just the hardware needed to power AI, adding extra muscle to the current bull run.

"We believe 1Q earnings will be a major positive catalyst for the tech sector and expect tech stocks to be up another 15% for the year adding to the strong start to 2024," Wedbush analysts, led by Daniel Ives, said in a note. 

The tech growth story seen in the current bull market run has been driven by the promise of the AI, with much of the focus on the hardware including semiconductors to provide the compute power needed to build AI models such as ChatGPT. While the hardware makers, mostly Nvidia (NASDAQ:NVDA), have been scooping up the AI investment dollars, the next gear of growth for this coveted technology now beckons: the software phase.

Enterprise spending on AI and related purchases will likely rise to 8% to 10% in 2024, Wedbush estimates, dwarfing the less than 1% seen in 2023, ushering in wave of dollars that will likely benefit companies in key areas including software, cybersecurity, digital advertising, and semis of the AI value chain. 

Microsoft Corporation (NASDAQ:MSFT), Alphabet Inc Class A (NASDAQ:GOOGL), Amazon.com Inc (NASDAQ:AMZN), Palantir Technologies Inc (NYSE:PLTR), Meta Platforms Inc (NASDAQ:META) with our favorite cyber security names Zscaler Inc (NASDAQ:ZS), CrowdStrike Holdings Inc (NASDAQ:CRWD), Palo Alto Networks Inc (NASDAQ:PANW), Cyberark Software Ltd (NASDAQ:CYBR), Checkpoint Therapeutics Inc (NASDAQ:CKPT), and Tenable Holdings Inc (NASDAQ:TENB) are expected to be standout performers in the upcoming Q1 earnings season, Wedbush said.

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"We see many incremental budget dollars now going to the software/build out phase of AI which should be a major focal topic on the upcoming 1Q conference calls," it added.

Microsoft, however, is likely to stand head and shoulders above the rest as demand for its Azure cloud platform will be spurred by an acceleration in the adoption of generative AI and Microsoft Copilot as AI use cases expand, adding another $25B to $30B, Wedbush estimates, to the tech giant's revenue by 2025.

Latest comments

It's hard to take an article seriously when the author can't even get the companies correct. Checkpoint Therapeutics? Come on dude...
the whole system has been taken over by entities beyond my understanding they have taken control of my money and plan to shoot off rockets into the eclipse
DAN IVES. What a joke. Guy will be in prison by years end
Why is that? He's been correct with most of his calls, except Tesla ( what a joke!)
What a massive waste of money while so many struggle just to pay bills . Stop sending government money to corporations and the elite snobs
trump’s tax cuts in 2017, estimated to cost $1.9tn over a decade, was a handout to the rich and corporations at the expense of working families. In fact U.S. billionaires got $1 trillion richer during trump’s term...
Yet the increase during bidens admin is much much greater. Go look at a chart showing the 1% during the last 3 admins. I mean i know you wont cuz your a hack but still - the charts shows you have no idea what your talking about.
Technology stocks continue to perform well.
Economic indicators suggest moderate growth.
remember how bullish this guy was on Telsa 6 months ago..... don't listen to this garbage.
AI is trained on stolen data. Just today some guy posted “his AI movie trailer” and all the helmets were Master Chief from Halo. It’s so blatant. I don’t understand how any of this is legal or why pretend it is.
THE Joe Schwartz?
It was way too soon to release AI. No parameters.
wow
Estoy listo para soltar mi portafolio
those this really sound nice
NVCA has a $2+ trillion market cap with only $20 billion revenue. This bubble is already over and will collapse like the EV bubble. AI cannot be monetized in the way they are advertising. AI wont go away but it is not going to produce return at a rate to justify current valuations. Remember everybody was suppose to be in an EV by 2025...
*NVDA
Steve Cohen is about to prove you wrong and treat you like the GME apes, who couldn't produce a financial model and didn't understand growth investing
they need to make sure the majority read this and go in to capture their selling chips
Did they actually check the market before publishing this 😅😅
These analysts are a joke
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