ARK Invest CEO Cathie Wood has plugged artificial intelligence (AI) software as a market for notable investment and growth.
Key Details
- Cathie Wood has defended AI as a technology that will add $200 trillion to global markets by 2030 and says software companies will be an important part of that.
- Nvidia’s stock rallied 184% in recent months as demand for semiconductors skyrocketed to meet the demands of building new AI data centers.
- Speaking with Bloomberg TV, Wood claimed this year that software applications will be a driving force in this rapidly advancing industry.
- The four stocks most likely to profit from this growth are Tesla, Microsoft, Amazon, and C3.ai, The Motley Fool notes.
Why It’s Important
The world changed forever on November 30, 2022, when OpenAI released ChatGPT. Within a few weeks, every major corporation and tech startup pushed to develop AI applications as quickly as possible to have the first and best chatbots and software available on the market. This spike resulted in a massive spring 2023 rally for tech stocks, with companies like Nvidia seeing record revenues due to high demand for AI hardware.
Wood believes that AI is rapidly going to scale the productivity and profitability of companies like never before, and it betting bullishly that that market will take off—more than it already has, with the S&P 500 having already rallied 16% year-to-date thanks to AI hype.
Backing Up A Bit
It will not be surprising if companies like Microsoft, Amazon, and Tesla are at the forefront of the AI revolution. Microsoft is already a partner with OpenAI and Builder.ai, which has placed it at the forefront of the ongoing “AI arms race” from the outset. Amazon owns Amazon Web Services, which stands to become more powerful and influential due to AI integration.
Tesla is also developing autonomous self-driving cars, which ARK Invest claims will increase its stock to $2,000 per share in four years and skyrocket its valuation to $6 trillion.
As The Motley Fool notes, C3.ai is the riskiest wildcard of the bunch. Despite the company being up 197% year-to-date, it is much smaller than its competitors, with its growth harmed by a recent transition to a new subscription-based business model. However, its technological suite of 40 AI application offerings has impressed its clients and earned it 287 notable business partners, with Wood fascinated by the suite’s ability to increase efficiency radically—allegedly reducing software code by 99%.
