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AI investment should broaden beyond data centers

Investor sentiment toward artificial intelligence has become increasingly focused on the extraordinary capital required to build the infrastructure underpinning the AI revolution. Headlines are dominated by hyperscaler spending plans expected to run into the trillions of dollars over the coming years.

Authors

    Portfolio Manager and Technology Analyst
    Analyst

Yet this intense focus on costs and capital spending risks obscures a more important development: AI is already generating meaningful business results. Strong growth in cloud revenues and expanding profit margins indicate that investments made by hyperscalers are beginning to generate returns. At the same time, AI startups are scaling rapidly, while enterprises are deploying AI tools to improve productivity, automate workflows and enhance decision-making.

The next phase of AI investing may be less about building infrastructure and more about identifying where adoption is creating durable competitive advantages.

Among the most promising areas is cybersecurity, where AI is helping organizations detect threats faster while also strengthening defenses against increasingly sophisticated AI-driven attacks. Healthcare is another emerging beneficiary, with applications ranging from administrative automation to clinical diagnostics, and drug discovery. Meanwhile, advances in robotics and autonomous vehicles demonstrate AI is making inroads into the physical economy.

Read the full article to explore where the next wave of AI-driven value creation may emerge and why investors may need to look beyond infrastructure beneficiaries to capture the opportunities ahead.

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