Google is not falling behind in the AI arms race. Can the stock price continue to rise after a 40% i

The introduction of ChatGPT into the market has triggered a worldwide race to dominate the AI market. Its exceptional technological prowess and the possibility of exceeding human capabilities have not gone unnoticed by industry giants. The resulting AI frenzy has seen participation from top corporations such as Google, Amazon, Meta, Microsoft, and Apple, all vying for the top spot in this burgeoning industry.

The AI boom has driven tech stocks higher, and Google is set to benefit from it.

With continued investment in AI by tech giants, there have been significant increases in capitalization of tech stocks. So far this year, the Nasdaq Composite Index has risen 30%. Among the super-large-scale AI beneficiaries, Nvidia's stock price has risen 192%, Apple has risen 42%, Microsoft has risen 43%, and Alphabet, Google's parent company, has risen 40%; at the same time, other tech giants have followed suit, with Amazon rising over 49%, Meta rising over 133%, and Tesla rising over 111%.

Goldman Sachs has released a report stating that AI will drive global economic growth by around $7 trillion over the next 10 years and estimates the total market size of AI software to reach $150 billion. Among all technology stocks, Microsoft, Google, Amazon, and Meta are most likely to benefit from this trend, as they are within the top ten weightings of the NASDAQ 100 index.

The AI industry chain typically consists of an upstream data and computing power layer, a midstream algorithm layer, and a downstream application layer. AI has already sparked a global wave of technological innovation and is expected to cover all industries, bringing many investment opportunities. Whenever an industry rapidly grows from scratch, capital will actively seek investment opportunities in relevant stocks.

With the maturity of generative AI technology, Google has introduced more AI technology into the collection field, and the real era of personalized advertising will come soon.

Recently, at the Google Marketing Live China event, Zhang Jun, Vice President of Marketing Insights and Solutions for Greater China at Google, revealed that Google's AI-enabled advertising products can help advertisers actively influence users at various stages of the buying decision process, achieving effective marketing. As search capabilities continue to develop, advertising will also evolve to provide more opportunities for businesses and brands to expand and showcase themselves.

It is understood that in the post-pandemic era, facing environmental and economic uncertainty, global consumers will be more cautious when shopping and will also consider more brands. 73% of consumers have already started trying new brands in the past 12 months.

Previous surveys have shown that advertisers using AI-powered advertising have seen an average increase in conversion rates of over 18% under roughly the same cost per conversion, compared to just 13% a year ago.

In the battle of intelligent AI, Google is not falling behind. A Bank of America strategist once stated in a report that Google AI still has an advantage in the search war compared to ChatGPT, so there is still room for Alphabet's stock price to rise, and reiterated a “buy” rating on Google's stock.

Despite contending with multiple challenges, including elevated interest rates, banking system crises, and intensifying geopolitical risks, global financial markets have registered enhanced volatility this year. Nevertheless, the US equity market has remained resilient and sustained consistent progress. The deceleration in the pace of Federal Reserve rate hikes, in conjunction with the probability of continued leadership by tech stocks, is a positive factor. As a leading technology powerhouse, Google stands to benefit from the burgeoning revolution in AI technology and thus is a promising prospect to anticipate during the second half of this year!