Overall, J.P. Morgan Research estimates generative AI could increase global GDP by $7–10 trillion, or by as much as 10%. “We affirm our extreme bullish outlier view, established over a year ago, on the importance of generative AI. The technology is driving a powerful tech investment wave, with co-pilots and other generative AI product cycles launching in the near term,” Murphy said. “Indeed, VC investments are pivoting rapidly from cloud and crypto to generative AI, and a material percentage of Y Combinator companies are also in this space.”
While generative AI is undoubtedly a massive boon for the software industry, hardware companies also stand to benefit from the uptake of the technology. “The AI-related supply chain is buoyant, with continued strong demand for AI training hardware and emerging demand for various AI inference solutions — both likely to sustain AI demand into 2024 and beyond,” Hariharan noted. This will boost the global semiconductor market, which is forecast to see a 16% growth in revenue in 2024 and increased demand into 2025.
Investments in other AI infrastructure will also continue to grow, particularly for servers, switches and optics, according to Samik Chatterjee, Head of the IT Hardware and Networking Equipment research team at J.P. Morgan. “The leverage to AI for certain sections of our broader hardware coverage is likely to be a windfall moment,” Chatterjee said.
AI end-point devices such as smartphones and PCs will also likely see a pick-up in product launches in the second half of 2024, with more material adoption in 2025. “These will focus on local inferencing to enable low latency and personalized experiences, while also leveraging more complex audio and visual interactions such as gesture and facial recognition,” Chatterjee added.
