|NVIDIA: A case study In Exponential Growth and AI|
AI is a huge market and these companies are already benefiting Chris Neiger (TMFNewsie)
Dec 15, 2020 at 9:22PM
Artificial intelligence (or AI) gets a lot of attention these days because the technology is being implemented into so many parts of our lives, from smart speakers to apps. And as AI expands, the opportunity for investors is enormous. Over the next four years, AI spending is estimated to double and reach $110 billion by 2024, according to research firm IDC.
For investors looking to tap into this enthusiasm for AI, there are a handful of companies pushing artificial intelligence forward. Here's why NVIDIA ( NASDAQ:NVDA), Amazon.com ( NASDAQ:AMZN), and Appian ( NASDAQ:APPN) should be on your AI stock buy list.
Image source: Getty Images.
1. NVIDIA For many years NVIDIA's core business came from selling graphics processors for gaming. But as data centers have become more complex, many companies have looked to NVIDIA's GPUs for their artificial intelligence data centers.
This shift has helped NVIDIA's data center revenue grow quickly and back in August the segment outpaced gaming revenue for the first time. In NVIDIA's most recent quarter, data center sales spiked 162% to $1.9 billion. Not all of the data center sales came from AI, but as more companies aim to boost their AI data center capabilities, many of them will look to NVIDIA's GPUs to help them do so.
NVIDIA is also pursuing new AI opportunities through its pending $40 billion acquisition of Arm Holdings. NVIDIA CEO Jensen Huang says the deal "will create a company fabulously positioned for the age of AI," as NVIDIA combines its artificial intelligence platform with Arm's CPU designs.
NVIDIA is already a leader in AI and when the company closes its acquisition of Arm Holdings, expected in the first quarter of 2022, the company's AI prospects appear even brighter.
Exponential Growth Of NVIDIA GAAP Operating Income