For technology investors, artificial intelligence (AI) is the next frontier. And for good reason, as Accenture finds investments in AI will turbocharge the economy, boosting productivity in the U.S. by more than a third and nearly doubling GDP growth rates. Early-stage AI investors are in a key position for multidecade returns.
We asked a trio of our Motley Fool contributors to highlight three companies well poised to take advantage of AI’s growth. Read on for why IBM (NYSE:IBM), Alphabet (NASDAQ:GOOG)(NASDAQ:GOOGL), and Amazon.com (NASDAQ:AMZN) made their lists.
Elementary, my dear Watson
Anders Bylund (IBM): With $78.7 billion of trailing revenues and $17.7 billion in EBITDA profits, IBM is an instant giant in pretty much any niche it decides to address. Big Blue has gone far beyond simply participating in the artificial intelligence business, though. The company is at the forefront of driving the AI issue on a global level, and has been for decades.
The IBM Watson AI platform sits at the core of everything the company does nowadays. Watson is a part of more than 16,000 IBM projects across 40 continents and 20 different industries. Impressive, right? But that’s just the beginning of a much larger ambition. Speaking at a recent investor conference, Senior VP Arvind Krishna said that IBM — and humanity in general — have a lot of work left to do in this space.
“We are only in the first or second innings of a long way to go,” Krishna said, according to a Seeking Alpha transcript. “This is all […] narrow AI, and narrow AI means AI that works for one task in one domain.”
At some point, machines should be able to mimic human intelligence, which means going beyond training the systems for a single task and expecting them to problem-solve on the spot.
“We believe we are decades away from that point,” Krishna said. “That’s what I call is going to be the next eight innings.”
And IBM plans to stay in the vanguard of that development. This is why the company has been selling off low-margin hardware operations in recent years, focusing on long-term growth drivers, with AI near the center of every focus area. Watson is already a big deal and will only grow more important from here. As an IBM shareholder myself, I’m downright excited about the direction this centennial company is going today…
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