Article: 2 AI Stocks to Keep an Eye on for Potential Growth
Artificial Intelligence (AI) has rapidly transformed various industries, revolutionizing the way businesses operate. In this article, we will explore two well-established companies that are poised to harness the power of AI and reach new heights.
When it comes to AI, Alphabet (GOOGL 0.01%) is an obvious choice as it has long been utilizing AI in its products and services. Google Search and Google ads have leveraged AI to enhance user experiences and improve monetization. Machine learning algorithms have been employed to improve ad relevance, resulting in better advertising outcomes, user experiences, and higher revenue for Alphabet.
Another area where AI is set to have a significant impact for Alphabet is its cloud computing business. By incorporating AI into its cloud computing products, Alphabet allows enterprises to leverage the latest AI technology and enhance their operations. For example, Google’s AI Platform enables companies to build and train machine learning models. As AI technologies continue to evolve, Alphabet is expected to introduce more AI-enabled cloud computing services, thereby creating new income streams.
Additionally, Alphabet’s moonshot bets, such as Waymo and Verily Life Sciences, have heavily relied on AI to solve complex problems. These investments have the potential to open up new growth opportunities for the company.
Meta Platforms (META -0.24%), formerly known as Facebook, is another company strategically positioned to leverage AI in its business. As Meta faces multi-year low growth in its advertising business, AI can help the company achieve more with less. It can automate workflows, reducing the need for human resources. Meta’s recent layoffs, which saw 22,000 jobs being cut, would have been more challenging without the integration of AI.
Furthermore, AI can enhance Meta’s user experience, leading to increased advertising income. By employing advanced AI algorithms, Meta can improve personalized content feeds and recommendation systems, encouraging users to engage more with the platform. A loyal user base is crucial for Meta’s advertising engine to thrive.
AI can also benefit advertisers on Meta’s platforms. By analyzing vast amounts of data and identifying trends, AI can provide valuable recommendations for advertisers to optimize their campaigns. Meta has recently introduced AI Sandbox, a set of AI tools including generative AI, to help advertisers maximize their results. The success of advertisers ultimately translates into sustained and increased advertising budgets on Meta’s platforms.
The metaverse is an area where Meta is heavily investing, and AI plays an essential role in enabling this vision. AI technology can enhance user experiences by creating more realistic and immersive environments on devices like augmented reality (AR) and virtual reality (VR). Additionally, leveraging tools like generative AI can help Meta reduce its cash burn by minimizing the reliance on human resources in areas like marketing and software development.
In summary, both Alphabet and Meta are strategically positioned to leverage AI and drive growth. Through their focus on AI and machine learning, these companies improve their core offerings, explore new income streams, and revolutionize industries. Considering their strong positions in the AI space, both companies are worth watching in the years to come.
