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The number of S&P 500 companies mentioning AI in their earnings calls has hit a record high.
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According to Goldman Sachs, 36% of companies mentioned AI in their fourth-quarter earnings calls.
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This basket of AI tech stocks has outperformed the similarly weighted S&P 500 since January 1, 2024.
American companies’ obsession with artificial intelligence shows no signs of slowing, driven by investor enthusiasm for all things related to the burgeoning technology.
Goldman Sachs analysts said in a note Wednesday that after a slight decline in the third quarter, the percentage of S&P 500 companies that mentioned AI in their earnings calls reached a record high of 36% in the fourth quarter. I wrote it down.
While tech giants like Microsoft, Amazon, and IBM have talked about the technology, non-tech companies like Bank of New York Mellon and UnitedHealth Group are betting that AI technology will improve productivity and reduce costs. He said he expects the product to improve.
Companies like Google and Advanced Micro Devices are also seeing increased demand for AI products and services, while executives from Meta, General Motors, Automatic Data Processing, and Franklin Resources cited the need for more investment in AI.
The spike in mentions of AI reflects “enthusiasm for technology,” the bank’s analysts argued.
Companies in the energy sector saw the biggest jump in mentions of AI, while real estate companies saw the biggest decline.
“As a basket of companies pursuing or enabling AI technologies, the stock reflects this management enthusiasm, outperforming the similarly weighted S&P 500 by 19 points since the beginning of the year,” Goldman analysts said. .
Shares of popular AI companies like Nvidia, TSMC, Arm, and SoundHound all soared in 2024.
Overall, S&P 500 earnings were better than expected. As of Feb. 14, companies representing 80% of the index’s market capitalization had reported earnings, with 58% beating analysts’ estimates by at least one standard deviation, according to Goldman Sachs. There is.
As the earnings season winds down, earnings per share are expected to grow 7% year over year.
Regarding the potential of AI, Goldman economists predict that investment in AI in the US will approach $100 billion by 2025.
Read the original article on Business Insider
