Artificial intelligence (AI) is probably the hottest investment area right now, and for good reason. The AI market is expected to expand at double-digit compound annual growth rates in the coming years and exceed $1 trillion by 2030. This means that many companies, and those that invest in them, could potentially benefit.
In addition to this, AI is generating excitement because it provides concrete examples of how it can save businesses time and money. For example, it can streamline processes and help pharmaceutical companies develop medicines faster. Therefore, the importance of this technology is easy to understand. That means he may want to start investing in AI players in 2024, which is the early stage of this high-growth story.
Nvidia, the world's leading AI chip maker, may seem like an obvious choice, but this high-flying stock isn't the only one to watch. In fact, his other two AI players are creating great stocks to buy and hold for decades thanks to their investments in AI and the potential for this technology to boost returns over time. Let's check it out.
alphabet
alphabet (NASDAQ:GOOG) (NASDAQ:Google)As Google's parent company, it is already the global internet search leader, holding over 85% market share. And with the company's investments in AI, this could continue to be the case. Alphabet is applying AI to search to expand its capabilities and improve search overall.
The company is testing AI across search and has responded to billions of queries to date. Testing showed that people using AI features increased search usage and improved user satisfaction with search results. Here's why this is so important: Alphabet makes most of its revenue from ads on the Google search page, and the more people use search, the more advertisers will come back.
It's also important to remember that Alphabet offers six products that boast more than 2 billion monthly users, and these represent an opportunity to integrate AI and grow revenue. Finally, Alphabet's Google Cloud business continues to grow double-digit revenue, and this is likely to continue thanks to its selection of AI products and services. Alphabet said in a recent earnings call that more than 60% of its funded generative AI startups are already Google Cloud customers.
Alphabet also emphasized that it has a “clear path” to monetize its AI investments through advertising, cloud, and subscriptions. All of this means that AI could have a significant positive impact on Alphabet's business over time, making now a great time to get into this top tech stock.
Amazon
Amazon (NASDAQ:AMZN) The benefits of AI are two-fold. First, our technology investments have lowered costs and satisfied our e-commerce business partners. And second, AI is boosting the company's revenue as Amazon Web Services (AWS) sells its AI products and services.
As a global leader in e-commerce, Amazon strives to improve efficiency, and AI helps drive efficiency, including by helping determine the fastest package delivery routes. Additionally, a newly released tool will allow Amazon to create detailed product pages for sellers' products with just a link to their website. Amazon says more than 100,000 sellers use at least one of its generative AI tools.
But the biggest impact may be on the revenue potential of AWS, which is already the company's main revenue driver. His AWS, the world's leading cloud provider, sells a wide range of his AI products and services, from his highest-performance Nvidia chips and platforms to his AWS proprietary chips for cost-conscious customers. .
Thanks to all this, AWS already generates billions of dollars in annual revenue. And since we're still in the early stages of AI adoption, it's important to remember that the long-term growth outlook for AI on AWS is particularly bright. CEO Andy Jassy said on an earnings call this week that the opportunities ahead are “tremendous.”
So Amazon has already delivered significant revenue growth thanks to its AI investments, and this momentum may just be starting, making Amazon a top AI stock to buy and hold for the long term. It is mentioned.
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Alphabet executive Suzanne Frye is a member of The Motley Fool's board of directors. John Mackey, former CEO of Amazon subsidiary Whole Foods Market, is a member of the Motley Fool's board of directors. Adria Cimino has a position at his Amazon. The Motley Fool has positions in and recommends Alphabet, Amazon, and Nvidia. The Motley Fool has a disclosure policy.
Are you ready to invest in artificial intelligence in 2024? 2 Stocks to Buy and Hold for Decades (Hint: Not Nvidia) was originally published by The Motley Fool.
