tech
Jim Cramer says the AI trade has shifted
CNBC's Jim Cramer said Wall Street is rewarding the companies supplying the artificial intelligence boom rather than the technology giants funding it.
TL;DR
- Wall Street is rewarding AI suppliers and punishing AI customers.
- The 'Magnificent Seven' have collectively lost significant market value as investors question their AI spending.
- Companies like Amazon, Alphabet, Microsoft, and Meta, which are heavy AI spenders, are now victims of high costs due to supply-demand imbalances for AI infrastructure components.
- Key beneficiaries of the AI boom are suppliers of essential components, including memory chipmakers like Micron and Sandisk, and companies like Intel, Marvell Technology, and AMD.
- Jim Cramer favors Intel, highlighting its CEO's revitalization efforts and the company's strong positioning in CPUs and advanced chip packaging.
- Cramer believes AI suppliers will continue to benefit as long as demand for AI infrastructure outpaces supply.