Wedbush Analyst Daniel Ives noted that the tech industry is preparing for Nvidia Corp. NVDA GTC 2024 in San Jose, named the “AI Woodstock”, marking the start of a significant leap in the AI revolution.
Under Jensen Huang’s leadership, Nvidia will likely unveil game-changing products, partnerships and use cases that will power the next phase of the AI revolution, according to the analyst.
The event will likely trigger a tidal wave of spending in the technology sector, with a forecast of more than $1 trillion in investment in AI over the next decade, he said.
This surge reflects the proliferation of business and consumer applications in what is known as the 4th Industrial Revolution.
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At GTC, the focus will be on Nvidia’s introduction of the Blackwell B100 AI chip and architecture, marking a milestone for the AI industry, Ives said.
With the Capex figures of giants like Microsoft Corp. MSFT, Alphabet Inc. GOOG GOOGLE Google, Amazon.Com Inc. AMZN, Oracle Corp. ORCLAnd Metaplatforms, Inc. META Underscoring the transformative nature of AI investments, Nvidia is at the forefront of this movement, the analyst continued.
The demand for AI is undeniable, with the enterprise market leading and consumer applications expected to follow.
The AI revolution will likely account for 8-10% of IT budgets by 2024, up from less than 1% in 2023. This growth is driven by significant spending on software, IT services and infrastructure that follows Nvidia’s hardware investments .
The analyst estimates that the company’s technology spending multiplier is substantial: for every dollar spent on an Nvidia H100 GPU chip, there could be between $10 and $12 in additional spending on software, IT services and infrastructure worldwide of technology.
As the AI ecosystem grows, companies are exploring new use cases and deepening technology partnerships, according to Ives.
Additionally, the impact of AI on software companies like Microsoft, Palantir, Salesforce, and Adobe, among others, is just beginning to surface.
It also means increasing spending on cloud cybersecurity to protect valuable data, benefiting companies like Zscaler, Inc. ZS, CrowdStrike Holdings, Inc. CRWDAnd Palo Alto Networks, Inc. PANW.
With these developments, the tech bull market is poised for growth, supported by robust trends and valuations that support a promising outlook for the sector in a soft landing scenario.
Truist Tracks analyst William Stein maintained Nvidia with a Buy and raised the price target from $911 to $1,177.
HSBC analyst Frank Lee reiterated Nvidia with a Buy and raised the price target from $880 to $1,050.
The stock has gained 241% in the last year. Investors can gain exposure to the AI leader via Invesco Nasdaq Free Cash Flow Achievers ETF QOWZ And Pacer Funds ETF Pacer Data and the digital revolution TRFK.
Price action: NVDA shares were down 0.10% at $877.50 at last check Monday.
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Disclaimer: This content was partially produced using AI tools and was reviewed and published by Benzinga editors.
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