2024 Should Generate the AI “Revenue Wave”

As the buzz expands the big bucks are set to follow.

There’s no doubt AI is a hit on the “vibe” circuit, the ascent of Gen AI tools like
Open AI’s ChatGPT has seen to that.

There’s equally no doubt, that financially, artificial intelligence certainly has potential as a breakthrough industry, right up there with the introduction of the personal computer and the arrival of the internet.

The data backs that sentiment up.

According to a new study by Bloomberg Intelligence, the generative AI market alone will grow $1.3 trillion over the next decade, up from $40 billion in 2022.

“(AI) growth could expand at a CAGR of 42%, driven by training infrastructure in the near-term and gradually shifting to inference devices for large language models (LLMs), digital ads, specialized software and services in the medium to long term,” BI’s research finds.

That all bodes well for the entire AI ecosystem from a profit potential point of view.

“The world is poised to see an explosion of growth in the generative AI sector over the next ten years that promises to fundamentally change the way the technology sector operates. The technology is set to become an increasingly essential part of IT spending, ad spending, and cybersecurity as it develops,” notes Mandeep Singh, Senior Technology Analyst at Bloomberg Intelligence and lead author of the report.

2024 a Breakthrough Year?

Evidence is bubbling up that the expected AI industry financial windfall is set to hit sooner than many might have expected.

That sentiment comes from Jefferies Senior Analyst Brent Thill in a November 14 interview with Yahoo Finance.

In it, Thill tells Yahoo that AI is comparable to the internet in terms of business impact, and that’s set the stage for monster profits.

“Everyone’s having a hard time really digesting what that means,” Thill says. “Sundar Pichai said that at Google. And ultimately, I think when we see these big tectonic shifts, right, when we saw mobility, we saw the internet, we saw that (investors) wanted to stay long in (AI) names in front of these cycles and through the cycle.”

Ultimately, artificial intelligence is going to hit a bubble but prosperity should arrive first.

“We’re not there now because valuations aren’t crazy given the post-pandemic (stock market) sell-off, and the multiple contraction we saw last year,” Thill adds. “Right now, I think we’re in that moment where AI is going to have a big impact over the next two to three years. None of these products and software are really having a big impact now, (but) they’re going to have a big impact in ‘2024.”

Thill believes the massive investment in AI development, particularly in the technology sector with the likes of Nvidia, Amazon, and Microsoft investing billions of dollars in artificial intelligence, will soon yield newer and more robust AI tools and services in 2024.

“These services come live next year, and this, this revenue wave will hit,” he notes. “If you listen to anyone in the industry, they’ll say that this is a way bigger impact than Web3, way bigger impact than crypto, way bigger impact than anything we’ve seen.”

“We’re seeing that now with Microsoft up 55% year to date. We’re seeing this with Amazon up 73% year to date with, with the move with AI,” Thill adds. “And we’re just getting started.”

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