Several software stocks are distinguishing themselves as leading contenders in the accelerating competition for supremacy in artificial intelligence (AI). Microsoft and Oracle have attracted the attention of Bank of America analysts.
Bank of America has developed a one-of-a-kind system for evaluating the AI success prospects of various companies. The system consists of thirteen critical parameters that assess factors such as the availability of high-quality data, a solid installed base for continuous data collection, and highly specialized business solutions. Each business is then granted points based on proficiency in these areas, with nine points representing the highest level of AI readiness.
Microsoft’s AI Approach
Microsoft has emerged as the leader in this evaluation, earning the highest score. The company’s substantial investments in OpenAI, an AI research laboratory, demonstrate its commitment to dominating the AI market. Microsoft recently announced its intention to integrate its Bing search engine into OpenAI’s ChatGPT chatbot, demonstrating its continued dedication. Microsoft’s partnership with OpenAI fuels its AI advancements and enables Azure OpenAI to offer OpenAI development services. This strategy is anticipated to contribute 1% growth to Azure in the fourth quarter. These strategic decisions have increased Microsoft’s stock price by approximately 37% in the first quarter of this year.
Oracle’s AI Potential
Oracle, another notable participant, has also been identified as a possible victor. Brad Sills, a Bank of America analyst, recently raised Oracle’s price target from $95 to $112 per share, indicating a potential 6.5% increase from its most recent closing price. Oracle’s primary advantage is integrating its core offerings with AI and machine learning capabilities. The company anticipates progressively incorporating generative AI into its application suites, including Fusion and NetSuite. Generative AI models calibrated with the company’s data are expected to result in more robust action recommendations for users. Oracle’s dedication to improving its software, particularly in areas related to its digital assistant and document comprehension, will make its cloud infrastructure a more desirable platform for AI workloads. Oracle’s stock price has increased by roughly 29% this year 1.
HubSpot’s AI Expenditures
In contrast, HubSpot’s stock price has increased roughly 77% this year. ChatSpot, an AI-enhanced customer relationship management assistant, connects HubSpot’s marketing, sales, and customer service professionals. Sills has observed an increase in commentary from the company regarding incremental investments in AI and machine learning, indicating its clear intent to increase its AI investments. AI is anticipated to improve the ability of service professionals to anticipate customer requirements, propose solutions, and drive improved outcomes. In addition, the potential use of AI in tasks such as data cleansing and email data collection represents additional opportunities for HubSpot.
AI’s ascent has signaled enormous opportunities for both vendors and investors. As the landscape of AI continues to evolve, the competition for supremacy will intensify. Microsoft, Oracle, and Hubspot have demonstrated remarkable strategies and outcomes, paving the way for an exciting AI domain battle.