Two AI Shares Worth Investing in Immediately, which may provide a solid foundation for a prosperous future
In the dynamic world of technology, two giants – Taiwan Semiconductor Manufacturing Company (TSMC) and Amazon – are making significant strides, propelled by advancements in Artificial Intelligence (AI).
TSMC, a dominant provider of chip foundry services, reported a staggering 60% surge in earnings to $2.47 per American depositary receipt (ADR) in the second quarter. This growth was driven primarily by booming sales of AI chips, a trend that shows no signs of slowing down. The company serves various industries, including data centers, smartphones, robotics, and autonomous vehicles, making it a key player in the global semiconductor manufacturing industry, where it commands a nearly 70% share.
In 2021, TSMC built 11,878 distinct products for 522 different customers, a testament to its versatility and global reach. Major clients include tech titans such as Apple, Alphabet, and Advanced Micro Devices.
Meanwhile, Amazon, the e-commerce giant, is also leveraging AI to drive profit margins higher in its operations. Advancements in AI are expected to help reduce labor costs over time, and Amazon's deployment of over one million robots in its fulfillment centers is a clear indication of this shift.
Amazon's cloud computing platform, Amazon Web Services (AWS), is another area of growth. AWS remains the clear leader in the rapidly expanding cloud platform and infrastructure market, with operating margins north of 30% and sales growing by 17% in the second quarter. Goldman Sachs projects that AWS's annual revenue could approach $1.2 trillion by 2030.
Amazon's deal with OpenAI, making the AI pioneer's models available to AWS customers for the first time, should further fuel this growth. With this move, AWS customers can now harness the power of cutting-edge AI technologies, potentially accelerating their own growth and innovation.
TSMC and Amazon, therefore, present attractive investment opportunities. TSMC's revenue and profits have grown by 18% annually since its initial public offering (IPO) in 1994, and it currently offers a well-supported and steadily growing 1.2% yield. With both its cloud computing and online retail businesses projected to grow more profitable, Amazon's stock is a smart investment today.
Moreover, the AI market is projected to reach $4.8 trillion by 2033, according to the United Nations Conference on Trade and Development. As these tech giants continue to innovate and lead in the AI space, they are poised to reap significant benefits from this growth.
In conclusion, the AI-driven success of TSMC and Amazon is reshaping the tech landscape and offering exciting opportunities for investors. As these companies continue to push the boundaries of what AI can achieve, we can expect to see even more impressive growth in the years to come.
