We recently compiled a list of the 10 AI Headlines Making Waves Today. In this article, we are going to take a look at where Snowflake Inc. (NYSE:SNOW) stands against the other AI stocks that are making waves.
According to the “Hyperscale Data Centers – Global Strategic Business Report”, the global market for hyperscale data centers is estimated to reach US$730.2 Billion by 2030, growing at a CAGR of 23.1% from 2023 to 2030. From the increasing adoption of cloud services to the rise of big data and artificial intelligence, several factors are at play when it comes to its rapid growth. As per the report, the biggest driver is cloud computing, with more and more companies migrating their workloads to the cloud to reduce costs, improve scalability, and enhance flexibility.
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These hyperscalers need a lot of energy to run their data centers around the clock. According to McKinsey & Company, data center power needs are expected to grow three times higher than the current capacity by the end of the decade, from between 3 and 4 percent of total US power demand today to between 11 and 12 percent in 2030. Naturally, the power sector has become a significant AI player. Several technology companies are looking at nuclear power, including the use of small modular reactors (SMR), to meet their electricity needs.
“Driven by recent trends in AI development, projected power consumption by data centers in the U.S. is expected to increase in the range from 8% to 17% by 2030—or potentially even higher, as progress in AI technologies is not linear but exponential, as seen in Silicon Valley today”.
-Energy expert Maksim Sonin
Recent AI News
As the demand for advanced computing power grows, the latest AI breakthroughs are reshaping industries and driving innovation at an unprecedented pace. Then again, nothing is perfect. A few days back, OpenAI’s premier chatbot, ChatGPT, went down for a total of 30 minutes. According to an outage tracking website Downdetector, over 19,000 people were impacted due to the chatbot’s unavailability. Sam Altman, the CEO, admitted to the outage on X and apologized.
The same company is said to be hitting stumbling blocks recently. That’s because, according to Bloomberg, its latest model Orion hasn’t been performing as well as the developers had hoped for. OpenAI, however, isn’t the only company seemingly facing a plateau. Three leading AI companies are now seeing diminishing returns from their costly efforts to build newer models.
In other news, search habits are changing across the globe now that artificial intelligence is here. According to research from Yext, a digital presence platform for multi-location brands, 45% of customers are likely to use and trust an AI tool for finding more information about a brand, while 51% now use social media, and 28% turn to voice assistants.
“Google impressions have dropped 8-20% in the past two years, pushing marketers to adapt as search behaviour shifts with AI-driven overviews, chatbots and social media searches. Instagram and TikTok have become favoured alternative search engines, particularly for younger consumers”.
– Anthony Rinaldi, senior director of insights at Yext.
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.
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 software engineer at work, surrounded by a wall of computer monitors connected to a ‘Data Cloud’ platform.
Snowflake Inc. (NYSE:SNOW)
Market Capitalization: $42.05 billion
Snowflake Inc. (NYSE:SNOW) is an AI data cloud company. This cloud-based data storage company is benefiting from the AI boom as data warehouses are a critical component in making AI useful for enterprises.
On November 12, Snowflake Inc. (NYSE:SNOW) announced a new platform at its annual developer conference, BUILD 2024. The new platform, Snowflake Intelligence, will allow enterprises to ask business questions across their enterprise data, unlock data-driven answers, and create data agents accordingly. The platform will provide enterprise-grade data agents that can help derive relevant business insights from the data, hosted within their data cloud instance and beyond. These insights can then be used to take action across different tools and applications, like Google Workspace.
“With Snowflake Intelligence, teams can easily create data agents that allow business users to talk to their enterprise data using natural language, and then analyze, summarize, and take action on those results from one unified platform. Snowflake Intelligence represents the next step in Snowflake’s AI journey, further enabling teams to easily, and safely, advance their businesses with data-driven insights they can act on to deliver measurable impact.”
– Baris Gultekin, Head of AI, Snowflake
Overall SNOW ranks 6th on our list of AI stocks that are making waves today. While we acknowledge the potential of SNOW as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and doing so within a shorter timeframe. If you are looking for an AI stock that is more promising than SNOW 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.
