We recently published a list of 10 Important AI Announcements for Investors. In this article, we are going to take a look at where QUALCOMM Incorporated (NASDAQ:QCOM) stands against other important AI announcements for investors.
Investment Shifts Highlight AI Spending Challenges
Blue Whale Growth, the investment fund supported by billionaire Peter Hargreaves, has reduced its holdings in major US tech firms, mentioning concerns over their substantial AI-related spending. Financial Times reported that fund manager Stephen Yiu highlighted a significant reduction in Microsoft shares, which dropped out of the fund’s top ten holdings for the first time since 2017. He noted that the return on invested capital for the company might decline due to AI investments and hinted at potentially exiting the stock entirely if AI costs exceed cash generation.
The “Magnificent Seven” tech giants have faced growing scrutiny over their rising capital expenditures on AI infrastructure, with Wall Street increasingly wary about returns. Yiu has also reduced stakes in Meta and previously exited Amazon and Alphabet, expressing concerns over AI-driven spending outpacing profitability, the report states.
While the fund remains optimistic about Nvidia, which now represents around 10% of its portfolio, Yiu expressed less confidence in the other six companies. He also supports Broadcom, benefiting from AI infrastructure development. According to the report, Blue Whale Growth, managing £1.3 billion, has returned 24% this year, outperforming peer funds, but has reduced its exposure to US tech stocks significantly compared to benchmarks.
READ ALSO: 13 AI News That Broke the Internet and Jim Cramer’s Game Plan for This Week: 8 Stocks in Focus.
Southeast Asia’s Growing Role in AI Innovation
In stark contrast to the caution seen in Western markets, Southeast Asia’s emerging economies are racing to establish themselves as key players in the global AI landscape. According to CNBC, the region benefits from a youthful, digitally savvy population and growing government support for AI initiatives. While Singapore has already made significant strides in AI adoption, other countries, such as Vietnam, Indonesia, and Malaysia, are also accelerating efforts to harness AI for a range of industries, from agriculture to manufacturing.
This growing focus on AI offers immense potential for economic growth, creating new jobs and boosting productivity. However, as these countries ramp up their AI strategies, they face challenges related to infrastructure, digital literacy, and the need for skilled workers. As experts point out, the AI race in Southeast Asia is not just about adoption but about tailoring technology to the region’s unique needs. Despite the hurdles, the region is positioning itself as a promising center for AI innovation, and many expect that ASEAN’s commitment to AI could help its economies thrive in the global tech ecosystem.
Massive AI Investment in the U.S.
Meanwhile, SoftBank Group CEO Masayoshi Son is making a bold move to accelerate AI development globally. Son plans to invest $100 billion in the U.S. over the next four years, with a significant focus on artificial intelligence and related infrastructure. His goal is to create 100,000 AI-related jobs before the end of President-elect Donald Trump’s term, as reported by Reuters. Known for his strong advocacy for AI, Son has already made notable investments in AI companies such as OpenAI and Graphcore, further signaling his commitment to the sector’s growth. This massive investment, paired with Southeast Asia’s rising AI ambitions, highlights the growing global momentum behind artificial intelligence.
For this article, we selected AI stocks by going through news articles, stock analysis, and press releases. We listed the stocks in ascending order of their hedge fund sentiment taken from Insider Monkey’s database of 900 hedge funds.
Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 275% since May 2014, beating its benchmark by 150 percentage points (see more details here).
A technician testing the latest 5G device, demonstrating the company’s commitment to innovation.
QUALCOMM Incorporated (NASDAQ:QCOM)
Number of Hedge Fund Holders: 74
QUALCOMM Incorporated (NASDAQ:QCOM) develops and commercializes technologies for wireless communication, including mobile devices, automotive systems, and IoT. The company also invests in emerging technologies, with a strong focus on artificial intelligence, extending its impact across industries like 5G, automotive, and cloud computing.
A trial between Arm and Qualcomm (NASDAQ:QCOM) begins on December 16 in Delaware, focusing on a dispute over Qualcomm’s use of Arm’s intellectual property following its $1.4 billion acquisition of chip startup Nuvia in 2021. Qualcomm used Nuvia’s designs to create AI chips for Windows laptops, which Arm claims require renegotiation of Nuvia’s license terms. Qualcomm argues its existing license covers these designs. For more details, you can check out our report: How ARM (ARM) And Qualcomm (QCOM) Can Turn A Courtroom Battle Into Mutual Success.
Overall, QCOM ranks 5th on our list of important AI announcements for investors. While we acknowledge the potential of QCOM as an investment, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than QCOM but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
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Disclosure: None. This article is originally published at Insider Monkey.
