Artificial intelligence, keep an eye on the semiconductor market
The global market of Artificial Intelligence it is estimated to be around $120 billion, a figure that some research institutes plan to expand several times to $1.6 trillion by 2030 as technology progresses. Currently, the market of the AI can be classified into four segments: Compute, Infrastructure, Developers, and Applications. Most of the hype surrounding AI is focused on developers like OpenAI (the company behind ChatGPT), but in reality the vast majority of AI-related spending is in the compute segment.
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While it’s hard to predict what AI could become in the next decade, what we do know is that AI models require massive amounts of data collection, scrubbing, and analysis. As tasks become more complicated, so does the computing power required. Taiwan Semiconductor Manufacturing Company (TSMC), one of the largest semiconductor companies in the world, may be in a unique position to tap into this insatiable appetite for computing power. Since 2013 the company has increased its dividends by increasing revenues due to growing market share in cutting-edge manufacturing.
The business of Broadcom is another major beneficiary of artificial intelligence. The company specializes in manufacturing application-specific integrated circuits (ASICs), which are critical for connecting AI clusters and driving traffic into and out of data centers. Since 2010 Broadcom has increased its dividends by increasing revenues especially in the semiconductors for communications.
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