Artificial intelligence presents a potentially "huge upside opportunity" for hardware vendors, but also significant risks, according to analysts at Bernstein.
In a note, the analysts led by Mark Newman suggested that as AI models continue to improve, the long-term potential benefits are "massive," with the technology addressing more tasks and "creating more value" for companies.
They estimated that the market for AI models that can infer -- digest information and perform specific actions like predictions or content generation -- for business could be as high as $11.2 trillion.
"This does not include anything for training or for consumer, which would all be additional," the analysts said, adding that their base case of $1.3 trillion is "cautiously optimistic."
Citing the Anthropic Economic Index, a tracker of AI adoption, they flagged that roughly 30% of knowledge worker tasks are currently addressable by AI, potentially implying around a 10% uptick in overall productivity. Based on this, they estimated a $370 billion total addressable market for enterprise inferencing from early 2025 AI models.
However, while "clearly material," they warned that this market size may not be large enough to sustain massive current levels of capital expenditures "without a near-term digestion" or a sharp improvement in existing AI models.
Hyperscalers, especially mega-cap tech giants like Amazon and Microsoft, have targeted heavy spending on AI in a bid to harness and monetize the technology.
"[L]eading models continue to show consistent improvement, and that model builders have a strong track record of downsizing leading edge models," the analysts said. "As a result, we believe that it is only a matter of time for models to be ’good enough’ for disruptive use cases, and disruptive on-device models will likely follow shortly afterwards."
Against this backdrop, Apple is tipped to be the firm with "the most to gain," but also the most to lose "if they get it wrong."
The Bernstein analysts backed an "outperform" rating of the iPhone maker, as well as software group Dell, and storage device makers SanDisk and Seagate.
Source :
https://www.investing.com/news/stock-market-news/which-it-hardware-stocks-stand-to-benefit-from-the-ai-boom-bernstein-weighs-in-4264000
