Daily Charts - AI Revolution
AI is the latest technology to capture imaginations. I’ve heard some interesting comments from people working closely with the technology. From, “The general public is grossly underestimating what is coming” to and I’m paraphrasing, “There is between a 5% and 50% chance AI destroys the world.” All to say, it is worth paying attention.
Technology investors, Coatue released a 100 page deck with some thoughts on the space. Coatue puts it this way, the last 30 years have been about building a better calculator, AI is building a brain.
ChatGPT has scaled from nothing to almost 40M unique weekly visitors in 5 months. This week Nvidia reported revenue for the third quarter ended October 29, 2023, of $18.12 billion, up 206% from a year ago and up 34% from the previous quarter. AI has also been the driving factor behind public market performance.
Weekly visits to ChatGPT sit around 400M. After the initial hype usage briefly fell-off but has been sustained.
For more and more applications, AI is achieving human level accuracy. The speed of innovation is increasing.
With the hype and usage, investment has followed. There are multiple AI unicorns in early stages.
Coatue and technologists are betting that AI is the next major technology platform, following the internet and smartphones.
Important for investors is where the value is going to be created. Both previous platforms saw blue chip companies created in both the early adoption and maturity phase of their adoption curves.
Interestingly, the smartphone wave created more value for the incumbents who existed prior to the invention of the smartphone.
The invention of the PC and internet brought productivity gains, S&P 500 companies required 2 less people per $1M of revenue. A win for capital over labour.
Coatue thinks AI is different than previously hyped technologies such as fiber, autonomous vehicles and quantum computing. It is important to think about where the value is going to accrue in the space.
They think AI is advancing at about 3x the speed of autonomous vehicles.
And Generative AI is attracting more attention than quantum computing in a fraction of the time before it arrived on people’s radars.
Midjourney, a generative AI tool is a good example of how fast the technology is advancing.
The expectation is that AI tools are going to require less and less human input.
It could change the way we work and disrupt professions. It seems everyone is going to be able to build a program, no need to code (Video). The video is worth watching.
