Profitable companies utilizing AI are well positioned to benefit from the growing opportunities in the AI industry. Despite the volatility in the stock market due to economic uncertainties and geopolitical pressures, investing in the S&P 500 has still proven to be profitable in the long run. AI is not just a passing trend but is transforming various aspects of life, work, and business worldwide. Therefore, it makes sense for investors to consider investing in high-quality AI stocks that can generate substantial returns over time. Microsoft and Meta Platforms are two companies that fit this profile. Microsoft has expanded its offerings beyond its Windows operating system and Microsoft Office suite. Its partnership with OpenAI has enabled it to establish expertise in generative AI. Microsoft Azure, its cloud computing platform, is a major player in the industry, benefiting from increased enterprise spending on AI services.
Azure offers a variety of AI chips and models, making it a popular choice for businesses. Additionally, Microsoft's AI-powered assistant, Copilot, has been integrated into multiple products, improving productivity and solidifying Microsoft's position in the market. Meta Platforms, the parent company of popular social media platforms like Facebook, Instagram, WhatsApp, and Messenger, has experienced significant stock gains. Despite challenges caused by changes in Apple's privacy policy, Meta turned things around by using AI to personalize user content and increase user engagement. It has also focused on unifying its AI-powered recommendation system across its video ecosystem, enhancing user engagement and generating more ad revenue. Meta's AI tools and products have attracted a large user base and contributed to increased advertising revenue. Considering Microsoft's sustained growth potential and Meta's promising AI initiatives, both companies present attractive investment opportunities for long-term investors.
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A version of this story appeared in CNN Business’ Nightcap newsletter.
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