AI stocks went way down today because a few leading AI companies aren’t putting in impressive profit reports.
And this has a few important lessons for us.
First, AI companies are making long-term investments while the market is looking for short-term profits.
It also seems to indicate that - based on their statements - AI companies are more focused on the long-term than the short-term profits.
And I believe this will be the right decision.
This has long been an issue in the US. Because of the market cycles and quarterly reports many US companies have focused more on quarterly results than long-term health.
The tech companies that are leading the market today do seem to have a habit of breaking this trend. Many of them consistently make long-term investments, including AI.
As I’ve previously mentioned in these articles AI is going to hit different industries at different times. It will be a slow roll-out and then sudden take-over.
AI is a critical mass play. One that benefits from long-term investment, long-term learning and long-term improvement.
And it is showing us the benefits of long-term investment and the discipline we need.
The US has long focused too much on the short-term. As the world gets more competitive those leading our equity markets are showing us they have a long-term focus.
This should bode well for their growth
Of course this will lead to the continued concentration of power in the hands of a shrinking group of large players. That will have bigger issues for all of us - something we’ll be discussing in the future.
Stay tuned!
Do you think the tech giants are making the right move to stay invested for the long-term? Let me know!
Source Material:
https://www.usnews.com/news/top-news/articles/2024-01-30/ai-companies-lose-190-billion-in-market-cap-after-alphabet-and-microsoft-report
Shawn
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NOTE: While legal issues are discussed this is education and is not legal advice. It is not a substitute for the advice of an attorney. Please consult your own attorney on your situation and to get legal advice about your circumstances. Courts are unpredictable may disagree with the author’s opinions.
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