Why the AI Boom Keeps Going Strong

By: Keith Wagstaff · May 29, 2024 · Reading Time: 3 minutes

Digital Gold Rush

If you think AI is just a fad, think again:. Last week, NVIDIA (NVDA), poster child of the industry, reported an astounding $26 billion in revenue for the previous quarter, pushing its stock price above $1,000.

NVIDIA, which makes chips that are essential for AI, brought in $14.9 billion in net income, more than Amazon (AMZN), JPMorgan (JPM), and ExxonMobil (XOM) reported for the latest quarter. Of course, the company isn’t alone in the AI boom, as Alphabet’s Google (GOOGL) and Microsoft (MSFT) recently pushed AI hard at their I/O and Build developer conferences, respectively.

Meanwhile, making the U.S. a competitive chip producer on the global market has entered politics, with the Biden administration investing billions in the industry. Similarly, South Korea committed $19 billion to boost its semiconductor industry, which could help it compete with Taiwan, China, and the U.S. in the race for chip supremacy.

NVIDIA Keeps Winning

NVIDIA can’t sell its chips fast enough as Big AI rushes to build large data centers capable of powering its AI products. And it’s planning to sell a powerful new chip, code-named Blackwell, to tech companies later this year for $30,000 a pop.

Meta (META) CEO Mark Zuckerberg said in January that the company plans to buy 350,000 of the new chips to support its AI ambitions.

AI in Demand

Whether you use AI at work or plan to talk to your boss about it, the technology has entered the mainstream.

Google announced it’s integrating its AI model, Gemini, into Gmail, Google Drive, and other products. Microsoft revealed its Copilot+ PCs will use AI to help people find files, create images, translate languages, and more.

Amazon is even planning to offer an updated version of Alexa with AI for a monthly subscription fee. And Apple (AAPL) is expected to showcase its AI advances next month at its WWDC conference. With industries as varied as banking and travel embracing artificial intelligence, the AI boom might not end anytime soon.

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