Goldman Sachs says AI still not showing up in companies' bottom lines
5 hours ago
- #Goldman Sachs
- #market trends
- #AI stocks
- AI-linked stocks have surged 17% this year, driven by big tech investments.
- A record 58% of S&P 500 companies mentioned AI in Q2 earnings calls, per Goldman Sachs.
- Despite the hype, few companies have tied AI directly to profits.
- McKinsey survey shows over 80% of firms say generative AI hasn't significantly impacted their bottom line.
- AI-exposed stocks rose 17% in 2024 after a 32% surge in 2023.
- S&P 500 trades at high valuations but below dot-com bubble and 2021 tech boom peaks.
- Goldman Sachs outlines four phases of AI trade: Nvidia-driven, hyperscaler-powered, AI-enabled revenues, and productivity gains.
- Phase 2 (current phase) sees hyperscalers (Amazon, Microsoft, Google, Meta, Oracle) investing heavily in AI infrastructure.
- Phase 3 involves AI integration into products to boost sales, but risks include price reductions and new competition.
- Phase 4 promises broad productivity gains, but adoption is still in early stages, with usage higher in large firms and specific industries.
- Goldman warns of risks if AI spending reverts to 2022 levels, potentially cutting $1 trillion from 2026 sales forecasts and reducing S&P 500 value by 15-20%.