The use of artificial intelligence (AI) technology is catalyzing the next platform shift, and will become integrated with every business, contributing to 25% of GDP growth, says Oppenheimer & Co.
The company's Thursday industry update to investors is a deep dive into the new AI food chain infrastructure.
In short, Oppenheimer's Timothy Horan said hyperscalers such asAmazon.com, Inc.AMZN Web Services, Microsoft Corp MSFT Azure, Alphabet Inc GOOG GOOGL Google Cloud Platformand eventually Web 3.0 will benefit from AI, putting the clouds $1.5 billion total addressable market share up for grabs.
Microsoft has the potential to be the operating system for AI with its new heterogeneous AI platform, the analyst said, and its OpenAI investment possibly gives the company insurmountable advantages in AI.
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Pick-and-shovel plays are the most immediate winners, Oppenheimer said, meaning investments in companies that provide the tools and equipment necessary to facilitate a growing industry, rather than investing directly in the industry itself are the better choice, followed by those with proprietary data or applications.
NVIDIA Corporation NVDA , Equinix Inc EQIX , and Taiwan Semiconductor MfgCo. Ltd. TSM stand to benefit from AI as arms suppliers, Horan noted.
The current AI market is in the $30 billion range, Oppenheimer said and is currently set to grow 100% per year.
The firm estimates AIs impact on the economy will be tenfold and will drive half the incremental GDP over the next decade, representing 20% of global GDP in 2032.
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