In the ever-evolving landscape of artificial intelligence, one sector reigns supreme: Generative AI. As 2023 unfolds, research from ResearchAndMarkets.com reveals that this burgeoning market is not merely a flicker on the industrial radar—it has exploded to a staggering valuation of $20.21 billion! Projections suggest that by 2032, this figure could skyrocket to an astonishing $440 billion, heralding an unprecedented compound annual growth rate (CAGR) of 41.31% across the forecasted timeline from 2024 to 2032.
The North American region currently holds the crown, commanding a hefty 34% share of the Generative AI market. This dominance is attributed to a robust technological infrastructure, a workforce steeped in skill, and a voracious appetite for AI-enhanced content. Meanwhile, Europe is also on the rise, fueled by government investments, a thriving startup ecosystem, and applications tailored to regional needs.
Cast your mind back to 2022, a time when the generative AI market was a domain ruled almost exclusively by established giants, who collectively snatched up 88% of the market share. Fast forward to today, and the tides are turning—new challengers are launching into this competitive arena with increasing frequency.
Sam Altman, the visionary CEO of OpenAI, has recently shed light on future AI innovations, asserting that we may soon witness the dawn of artificial general intelligence (AGI)—a theoretical benchmark in machine intelligence that mirrors human cognitive capabilities—by as early as 2025. At the New York Times’ illustrious DealBook Summit, he expressed optimism about the transformative potential of these technologies, hinting at a remarkable shift in expectations.
“I think it’s possible… in 2025 we will have systems that we look at… and people will say, ‘Wow, that changes what I expected,’” Altman declared, teasing the implications of this forthcoming epoch in AI development.
While Altman does caution that the initial impact of AGI might be subtle, he warns that the reverberations will grow more pronounced than anyone anticipates. Excitingly, OpenAI has recently embarked on testing two new reasoning models, dubbed o3 and o3 mini—demonstrating an aggressive foray into AI capabilities that challenge competitors like Google. Anticipation swells as OpenAI aims to debut o3 mini by the end of January, with a full o3 rollout to follow. These innovations promise to surpass existing benchmarks, fueling new investment avenues and user engagement.
Amidst this flurry of activity, we turn our gaze to CrowdStrike Holdings, Inc. (NASDAQ:CRWD), a titan in AI-driven cybersecurity solutions. With a growing portfolio and a strategic partnership with SHI International, the company has surpassed the $1 billion revenue milestone. Notably, Jefferies has raised CrowdStrike’s price target from $415 to $450, maintaining a bullish outlook. They anticipate that software stocks will experience a muted start as 2025 approaches, as investors recalibrate to the shifts introduced by the incoming administration. Nevertheless, given its solid fundamentals, cybersecurity is expected to weather the storm better than its counterparts in the AI software sector during the early months of 2025.
In this dynamic environment, CrowdStrike firmly stands in second place among our curated list of the most formidable AI stocks. Although it presents an excellent investment opportunity, we believe there exist alternatives within the AI stock universe that promise even higher returns in a shorter timeframe. For those enticed by the notion of investing in undervalued AI stocks that trade under 5 times their earnings, we encourage you to explore our insights further.
This invigorating panorama of artificial intelligence reveals not only where we are but beckons us to consider where we might go next—an adventure filled with both promise and complexity, marked by rapid advancements and competitive races across the technological landscape.
