Microsoft, Apple, and Nvidia stand as the world’s only companies to exceed $3 trillion in market capitalization, underlining their unprecedented value. Their continued growth prospects appear robust, particularly with the anticipated advancements in artificial intelligence (AI).
Projections indicate that AI could significantly amplify global economic output:
- Goldman Sachs estimates AI will contribute $7 trillion to economic activity over the next decade.
- PwC forecasts AI to add $15.7 trillion to the global economy by 2030, driven largely by enhancements to existing products.
- Ark Investment Management is notably bullish, suggesting that AI technologies such as OpenAI’s ChatGPT could propel a productivity surge potentially worth $200 trillion to the global economy.
Given these forecasts, even conservative estimates suggest substantial growth opportunities. This leads me to believe that Oracle (NYSE: ORCL) and Alphabet (NASDAQ: GOOG)(NASDAQ: GOOGL) are poised to ascend as two of the world’s most valuable companies in the coming decade. Here’s why.
Oracle is positioned as a leader in AI infrastructure, much like Nvidia dominates with its GPUs essential for data center AI applications. CEO Jensen Huang emphasizes that data center operators could realize substantial revenue from Nvidia’s chips due to high demand for computing power among AI developers.
Oracle stands out with its advanced AI data center infrastructure, featuring proprietary RDMA (random direct memory access) networking technology that accelerates data transfer significantly compared to standard Ethernet networks. This capability translates into faster and more cost-effective AI development.
Moreover, Oracle’s upcoming SuperCluster technology will enable developers to scale computing capacity up to 65,536 Nvidia GPUs, surpassing current offerings like Amazon Web Services, which supports clusters of up to 20,000 GPUs. This positions Oracle as a preferred choice for developers working on large-scale and complex AI models.
In fiscal 2024 Q4, Oracle reported a notable 44% year-over-year increase in remaining performance obligations (RPOs), reaching a record $98 billion, with $12.5 billion attributed to new AI deals. Leading AI firms such as OpenAI and xAI, affiliated with Elon Musk, are among those eager to leverage Oracle’s expanding computing capabilities.
