Shulou(Shulou.com)11/24 Report--

CTOnews.com, July 28 (Xinhua) UBS Group, a financial investment agency, recently released an analysis report in which UBS raised its long-term forecast for terminal demand for artificial intelligence from 20% compound annual growth rate (CAGR) from 2020 to 2025 to 61% compound annual growth rate from 2022 to 2027.

▲ Tuyuan UBS reported that since the beginning of this year, the total market capitalization of global technology stocks has increased by $6 trillion year-on-year (CTOnews.com note: about 42.93 trillion yuan), of which artificial intelligence-related stocks account for about $2 trillion (about 14.31 trillion yuan).

UBS said: "given the clear use cases and solid long-term visibility, we do not think artificial intelligence is a bubble, but we recommend that investors consider companies with 'clear commercial landing' plans."

UBS also pointed out that the field of artificial intelligence is mainly composed of infrastructure layer, application layer and data model layer. Building an AI system requires training large data sets, and most of the AI-related spending is now concentrated at the infrastructure level, the group said. But in the medium and long term, the role that AI can actually play (application and model part) is the leading force that makes enterprises stand out. It is expected that the artificial intelligence market will expand from semiconductor and hardware-centric infrastructure layer to software and Internet-based application and data model layer in the future.

UBS predicts that global demand for artificial intelligence will grow from $28 billion (about 200.032 billion yuan) in 2022 to $300 billion ($2.14641 trillion) in 2027, and is expected to become one of the fastest-growing areas of global technology. By 2027, artificial intelligence applications and models will generate $170 billion (1.215299 trillion yuan) in revenue, with a compound annual growth rate of 139 percent, while semiconductors and hardware-centric infrastructure will generate revenue of $130 billion (about 930.111 billion yuan), with a compound annual growth rate of 38 percent.

In view of the high valuation, we are bullish on the artificial intelligence sector. At the same time, we believe that the risk and return of software stocks is also attractive, and software stocks are in a good position to integrate with the growing demand for artificial intelligence. For example, the integration of Microsoft Copilot AI and office automation software, the integration of OpenAI with big data's analysis needs, and the integration of Adobe artificial intelligence with its image / video software will bring great opportunities to the technology market.

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