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The artificial intelligence (AI) stock that is now attracting the attention of billionaires is not Nvidia, but another. Why this rush towards this new action?
Why billionaires are leaving Nvidia
In recent years, Nvidia has attracted considerable attention in the stock market thanks to its central role in the generative AI revolution. However, after an increase of almost 700% in two years, several influential investors are wondering how much further the stock can rise in the short term.
Iconic figures like Israel Englander of Millennium Management, Ken Griffin of Citadel, as well as John Overdeck and David Siegel of Two Sigma, began cashing in their profits. They redirect their funds towards other investments that are potentially more promising in the short term.
Amazon’s growing appeal in AI
As Nvidia continues to thrive, billionaire investors are turning their attention to another company: Amazon. These recent investments show that they consider Amazon as a safer and more promising value in the field of AI.
Some key figures:
- Englander purchased 2,476,287 Amazon shares, an increase of 34%
- Griffin acquired 4,673,930 more shares, an increase of 246%
- Overdeck and Siegel added 364,950 shares to their position, an increase of 41%
Amazon and its involvement in generative AI
Both Amazon and Nvidia are invested in generative AI, but in very different ways. While Nvidia creates the graphics processing units (GPUs) that power generative AI, Amazon focuses on developing applications that use the technology.
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For example, Amazon Web Services (AWS), Amazon’s cloud computing segment, offers a range of generative AI applications to its customers. These tools help create chatbots, virtual assistants, code prompts for developers, and advanced data analytics.
Amazon Web Services: A Massive Opportunity
For Amazon, the opportunities are multiple. AWS is already the world’s leading provider of cloud services. By integrating generative AI tools, Amazon can not only retain existing customers, but also attract new ones.
Companies like DoorDash are already using these tools to optimize their operations. DoorDash, in particular, created a self-service contact center for its delivery workers using AWS generative AI tools.
Amazon’s competitive advantage
In addition to its advances in AI, Amazon uses machine learning and data analysis in its e-commerce. This technology helps make accurate recommendations to customers and optimize delivery routes to reduce costs and increase speed.
Additionally, Amazon uses this infrastructure to strengthen its advertising business. With millions of Prime members and other shoppers, Amazon can target its ads with remarkable precision, increasing sales for sellers and for Amazon itself.
Why Amazon might be a better choice right now
Despite Nvidia’s strength, some investors are concerned about its high valuation and growing competition. In contrast, Amazon stock, even after a 32% rise this year, has only risen 9% over the past three years, still leaving plenty of growth potential.
With massive and diverse opportunities in AI and cloud computing, Amazon seems to be a safer and promising position, especially recommended by many billionaire investors.
