Depending on who you ask, artificial intelligence (AI) will have a huge positive or negative impact on society. For example, investor Warren Buffett compared AI to building an atomic bomb, and Kathy Wood predicts that AI will quadruple the productivity of knowledge workers by the end of 2020.
The most frustrating thing about predicting the future of AI is that both Buffett and Wood could be right. The only certainty is that, like most technological advancements, there will be a high demand for workers with experience using all the new AI-powered tools.
Fortunately, there are ways for ordinary investors to bet on the continued expansion of job opportunities for workers with AI-related experience.it is called fiber (FVRR -0.68%)For those unfamiliar, this is already the most popular place on the internet to find tech-savvy freelancers.
AI is already a big growth driver
Few weeks have gone by in recent months without big layoff announcements from big tech companies. While tech companies are cutting back on new hires, non-tech companies are still hiring tech-savvy freelance workers. Fiverr’s first-quarter sales grew 1.5% year-over-year, despite widespread fears of a global recession.
The recent proliferation of generative AI services such as ChatGPT by OpenAI is already a big plus for Fiverr. At the company’s latest earnings call, CEO Mika Kaufman said the AI business has grown exponentially over the past six months, with a 900% increase in the number of AI-related jobs and an even greater increase in prospective buyer searches for workers with AI experience. He said it was growing at a fast pace.
simple prediction
After initiating a multi-year partnership with OpenAI worth an estimated $10 billion, microsoft It appears to have the upper hand in the generative AI market. Having said that, alphabet started moving from a mobile-first business to an AI-first business in 2016, and has a wealth of resources to work on.
It’s too early to know which generative AI services will be the most popular, but for Fiverr’s investors, this matters little. Ultimately, all AI services base their results on existing human-generated content, which is rarely perfect.
The work of validating and editing AI-generated content is currently flourishing on Fiverr’s platform. Given the inherently derivative nature of AI-generated content, this seems like a credible trend for years to come.
bargain now
Fiverr’s revenue as a percentage of total payments processed on its platform, a metric the company calls take rate, ballooned to 30.4% in the first quarter. This may make you think twice about hiring freelancers through this platform, but buyers clearly find the service worth coming back again and again.
Despite the challenging macroeconomic environment, the number of businesses and individuals actively purchasing services on Fiverr’s platform at the end of March was up slightly year-on-year. In addition to the overall increase in buyers, the amount spent by the average buyer increased by 4% year over year.
The last 12 months have been more difficult than usual, but Fiverr has continued to push for profitability. First quarter net loss under generally accepted accounting principles (GAAP) narrowed to $0.11 per share from a loss of $0.46 a year ago.
Fiverr’s stock can now be purchased for just 18.9 times your projected future earnings.This is only slightly higher than the benchmark average stock price S&P500 The index is currently trading at an estimated 18.5x.
Fiverr, which is generally positioned to grow its business with the popularity of AI-related applications, has the potential to grow earnings faster than the average share price of any benchmark index. Buying now and holding for the long term seems like the right course of action.
Alphabet executive Suzanne Fry is a member of the Motley Fool’s board of directors. Cory Renauer has no positions in any of the mentioned stocks. The Motley Fool has positions with and endorses Alphabet, Fiverr International and Microsoft. The Motley Fool has a disclosure policy.
