In this article, we will take a look at the 5 AI stocks billionaires are loading up on. To see more such companies, go directly to 10 AI Stocks Billionaires are Loading Up On.
5. Meta Platforms, Inc. (NASDAQ:META)
Number of Billionaire Investors: 26
Meta Platforms, Inc. (NASDAQ:META) is not behind in the AI race. Meta Platforms, Inc. (NASDAQ:META) earlier this year revealed its own large language model called LLaMA and went a step ahead and made it open source, something no other company has done. In Meta Platforms, Inc. (NASDAQ:META)’s latest earnings call Mark Zuckerberg talked about AI and how the technology is already helping the company in its business. Meta Platforms, Inc. (NASDAQ:META)’s ads revenue saw huge growth in the first quarter thanks to its Reels feature which according to many reports is using AI technology.
A total of 26 billionaires in Insider Monkey’s database had stakes in Meta Platforms, Inc. (NASDAQ:META) as of the end of the first quarter.
Harding Loevner Global Equity Strategy made the following comment about Meta Platforms, Inc. (NASDAQ:META) in its Q1 2023 investor letter:
“The losses from SVB and First Republic were significantly mitigated, though not fully offset, by a rebound in shares of growth companies, which contributed to outperformance among our Communication Services and IT holdings. Our biggest relative contributor was Meta Platforms, Inc. (NASDAQ:META), the parent of Facebook, which pledged to boost efficiency through layoffs and a hiring freeze.”
4. Salesforce.com, inc. (NYSE:CRM)
Number of Billionaire Investors: 26
Salesforce.com, inc. (NYSE:CRM) has literally launched a barrage of AI products. Earlier this year it launched Einstein GPT, an AI tool for Salesforce.com, inc. (NYSE:CRM). Salesforce.com, inc. (NYSE:CRM) recently revealed MarketingGPT and CommerceGPT to cover more business areas. It has also launched Slack GPT and Tableau GPT to launch AI in communications platforms.
As of the end of the first quarter of 2023, 26 hedge funds tracked by Insider Monkey had stakes in Salesforce.com, inc. (NYSE:CRM). Some notable billionaires having stakes in Salesforce.com, inc. (NYSE:CRM) include Thomas Steyer, Stephen Mandel, Steve Cohen, among others.
Harding Loevner Global Equity Strategy made the following comment about Salesforce, Inc. (NYSE:CRM) in its Q1 2023 investor letter:
“It also signaled lower capital expenditures and increased share repurchases. Other tech companies, including Salesforce, Inc. (NYSE:CRM), similarly benefited from plans to lower costs and increase profitability. Meanwhile, NVIDIA, the graphic-chips designer, surged amid investor enthusiasm over the potential commercial applications of artificial-intelligence technologies, such as ChatGPT, which requires the use of many chips.”
3. Amazon.com, Inc. (NASDAQ:AMZN)
Number of Billionaire Investors: 31
Amazon.com, Inc. (NASDAQ:AMZN) ranks 3rd in our list of the AI stocks billionaires are loading up on. Insider Monkey’s database shows that 31 billionaires were invested in Amazon.com, Inc. (NASDAQ:AMZN) as of the end of the first quarter of 2023. These include Warren Buffett, Chase Coleman, Andreas Halvorsen, and Philippe Laffont.
Amazon.com, Inc. (NASDAQ:AMZN) is a notable AI player since the company’s AWS Cloud platform offers various technologies and toolkits to help developers make AI applications.
Lakehouse Global Growth Fund made the following comment about Amazon.com, Inc. (NASDAQ:AMZN) in its April 2023 investor letter:
“Amazon.com, Inc. (NASDAQ:AMZN) delivered a positive quarterly result with overall growth and profitability coming in ahead of expectations. Net sales increased 9% year-on-year (11% constant currency) to $127 billion and operating profits increased 30% year-on-year to $4.5 billion. In retail, growth proved resilient and it was encouraging to see operating margins for the North American unit turn positive for the first time since mid 2021 – coming in at 1.2% (or roughly 1.5% ex-restructuring). Even more encouraging, though, was Andy Jassy’s comments that they are confident they can achieve pre-pandemic operating margin levels of 4%-6% for North America with time. Looking forward, we continue to believe there is significant margin expansion ahead as cost pressures related to external macro factors, such as elevated shipping and fuel costs, and also lower productivity and efficiency continue to ease over 2023.
On the other hand, the outlook for the company’s second largest segment, Amazon Web Services (AWS), wasn’t so rosy. AWS grew 16% year-on-year to $21.4 billion, which isn’t terrible, but was a material deceleration from last quarters growth of 20%. Concerns were only heightened by management’s comments that growth slowed even further to 11% in April. As has been the case over the last few quarters, the headwinds were driven by enterprise customers seeking to optimise cloud spending and management reiterated that the slowdown is macro-driven. These comments are consistent with what we have heard from other cloud providers, and in our view, the current headwinds are more a factor of strong comparison periods and cyclical weakness, as opposed to any fundamental issues. Taking a step back, AWS remains the leading cloud provider (in what is an increasingly two-horse race with Microsoft’s Azure) and with 90% of global IT spend still on-premise there is still plenty of runway for future growth. At current levels, Amazon’s valuation at 5x gross profit is the most attractive it’s been since the GFC and we remain confident that patient shareholders will be treated well as the company is set to deliver many years of solid revenue growth and margin expansion.”
2. Alphabet Inc. (NASDAQ:GOOGL)
Number of Billionaire Investors: 32
Alphabet Inc. (NASDAQ:GOOGL) is a major beneficiary of the AI boom. Alphabet Inc. (NASDAQ:GOOGL) already has an edge in the market since it has been investing heavily in the AI space over the past few years. Alphabet Inc. (NASDAQ:GOOGL) has already revealed its plans to revamp its search to integrate AI. According to the latest Reuters report Alphabet Inc. (NASDAQ:GOOGL) entered a deal with Priceline to allow the travel platform to use its AI-based chatbot to assist Priceline customers. The chatbot will help Priceline customers with tasks like flight searches, hotel suggestions, and personalized trip itinerary design.
Insider Monkey’s proprietary database of billionaires shows that 32 billionaires had stakes in Alphabet Inc. (NASDAQ:GOOGL) as of the end of March. Some of them include Chris Hohn, Ken Griffin, and Rajiv Jain.
Lakehouse Global Growth Fund made the following comment about Alphabet Inc. (NASDAQ:GOOG) in its April 2023 investor letter:
“Alphabet Inc. (NASDAQ:GOOG) reported a modest quarterly result, with revenue and earnings per share up 2.6% and down 4.9% year-on-year, respectively. It was a mixed quarter with a weak advertising market offset by strong momentum in Google Cloud and growth in the YouTube subscription business. Advertisers continued to pull back on spending during the period, though we are starting to see quarter-on-quarter improvements in the performance of Google Search and YouTube ads. The highlight of the quarter was Google Cloud’s strong operational results, with revenues up 28% while posting profitability. This was driven by strong relationships with large enterprises and the partner ecosystems that have been built over the past four years. Moving forward, the opportunity for Alphabet to deliver consistent profitable growth relies on its ability to control costs and improve productivity. The recent restructuring round is a step in the right direction and we believe that management will be able to efficiently manage its costs while going after growth opportunities.”
1. Microsoft Corporation (NASDAQ:MSFT)
Number of Billionaire Investors: 33
A whopping 33 billionaires were invested in Microsoft Corporation (NASDAQ:MSFT) as of the end of March 2023. The worth of their holdings was $27.5 billion. Hedge funds were upping their bets on Microsoft Corporation (NASDAQ:MSFT) after the firm showed remarkable speed and agility in the AI space and surprised the world with its huge OpenAI investments, its disruptive plans for Bing search, and its promising new product features in a bid to mainstream AI for the general public.
The barrage of AI announcements from Microsoft Corporation (NASDAQ:MSFT) continues. Recently, it was reported that Microsoft Corporation (NASDAQ:MSFT) will provide access to OpenAI’s large language models to some federal agencies that use Azure Government cloud computing services.
As of the end of the first quarter, notable billionaires having stakes in Microsoft Corporation (NASDAQ:MSFT) include Chris Hohn, Cliff Asness, and Rajiv Jain.
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