Advancements in AI have revolutionized many industries, from healthcare and education to finance and entertainment, offering unparalleled efficiency, precision, and the ability to handle complex tasks at a scale previously unimaginable.
On the positive side, AI can streamline operations, improve decision-making, and even solve pressing global issues like climate change by analyzing large datasets. However, these advancements also come with significant risks. The rapid growth of AI technology has raised concerns about privacy, job displacement, and the potential misuse of AI systems in surveillance and defense.
READ ALSO: 12 AI News and Ratings Investors Probably Missed and Jim Cramer Discussed 10 Stocks That Can Do Well in December.
OpenAI’s Push into Defense Raises Concerns Among Employees
OpenAI is teaming up with Anduril Industries to enhance anti-drone systems using its AI technology, as per Bloomberg. This partnership aims to improve the detection and response to unmanned aerial threats. OpenAI is also expanding its role in the defense sector, including collaborations with the U.S. Air Force and hiring former Pentagon officials. The deal reflects the growing U.S.-China competition in military AI development, with Anduril seeing it as vital for addressing global air defense gaps. The partnership also signals increasing AI involvement in defense, following similar moves by other tech companies.
However, OpenAI employees have raised concerns about the company’s partnership with Anduril Industries, seeking more transparency from leadership. Internal messages viewed by The Washington Post revealed worries that the AI technology could be used beyond defensive applications against drone attacks, potentially targeting human-piloted aircraft or being deployed for other military purposes. Some employees expressed discomfort with collaborating with a weapons manufacturer, fearing damage to OpenAI’s reputation. Others noted that even defensive uses of AI could contribute to its militarization, drawing parallels to the fictional Skynet system from The Terminator, which was originally designed for defense.
Apart from OpenAI, there are several other startups that are working in the military and defense sectors. One of them includes DEFCON AI, a company focused on next-generation modeling, simulation, and analysis (MS&A) for military logistics. The company focuses on creating efficient, reliable systems that help address disruptions in logistics and supply chains, ensuring timely delivery of personnel, equipment, and cargo during critical situations.
Its approach combines AI-driven intelligent agents and advanced modeling to help leaders test and prepare for contested logistics scenarios. In August, DEFCON raised $44 million in seed funding. The round was led by Bessemer Venture Partners, with participation from Fifth Growth Fund and Red Cell Partners. With its strong leadership team, including retired military officials, the company is set to address the growing need for intelligent military technology in the face of increasing global competition.
For this article, we selected AI stocks by going through news articles, stock analysis, and press releases. These stocks are also popular among hedge funds.
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11. Super Micro Computer, Inc. (NASDAQ:SMCI)
Number of Hedge Fund Holders: 33
Super Micro Computer, Inc. (NASDAQ:SMCI) designs high-performance server and storage solutions optimized for AI workloads. Its offerings include modular server systems, AI-focused computing platforms, and server management software, catering to enterprise data centers and cloud AI applications.
On December 6, Super Micro (NASDAQ:SMCI) announced it has received an exception from Nasdaq to delay filing its fiscal year 2024 annual report and Q1 2025 quarterly report until February 25, 2025. During this period, its stock will remain listed on the Nasdaq Global Select Market, provided the company meets all listing requirements. Super Micro expects to complete the required filings by the given deadline. The company shares were up around 9% at market open on December 9, compared to market close on December 6.
10. DocuSign, Inc. (NASDAQ:DOCU)
Number of Hedge Fund Holders: 42
DocuSign, Inc. (NASDAQ:DOCU) provides electronic signature solutions globally, including AI-powered features like advanced analytics and signer verification. Its Intelligent Agreement Management (IAM) platform is a collection of applications that help organizations create, manage, and commit to agreements and uses AI to speed up contract creation, improve negotiations, and provide strategic insights.
On December 6, The Fly reported that Piper Sandler raised its price target for DocuSign (NASDAQ:DOCU) to $90 from $60, maintaining a Neutral rating after the company surpassed Q3 expectations. While the firm is encouraged by the continued stabilization of DocuSign’s performance, it remains cautious and is waiting for more evidence of a significant shift in growth. The firm also seeks clarity on how DocuSign’s new IAM platform will contribute to its broader potential, as it believes it is still early in the development of this opportunity.
