Salesforce and Google recently unveiled their new AI-powered tools, Agentforce 2.0 and Gemini 2.0 respectively. This move highlights the growing competition among tech giants to develop artificial intelligence (AI) solutions.
Experts say that AI can contribute to revenue growth for software giants, but the expected impact is a relatively small percentage – around 1%. KeyBanc analyst Jackson Ader stated that this might seem underwhelming, but considering the size of the companies involved, even a small boost can be significant.
International Data Corp. President Crawford Del Prete agrees that AI can drive growth, but emphasized that the numbers are substantial. For example, if Microsoft converts 5 million devices to its Copilot service, it would generate almost $2 billion in revenue.
However, some analysts downplay the expected benefits of AI monetization. Wedbush analyst Daniel Ives predicts that AI spending will exceed $1 trillion by 2025, but notes that investors must be patient and focus on long-term growth.
Meanwhile, Broadcom’s earnings report highlighted the momentum of AI trends, but also underscored the importance of patience. Melius Research analyst Ben Reitzes believes that investors should focus on the future potential of AI revenue, which could reach $9 billion by 2027.
Despite these positive views, some analysts are more cautious. Monness Crespi Hardt’s Brian White downgraded shares of data software company MongoDB to sell due to concerns about generative AI monetization. He argues that the hype around AI has not materialized into revenue growth for enterprise software companies.
The battle between tech giants and their AI tools is set to intensify in 2025. With companies like Microsoft, Google, and Amazon competing to prove their AI solutions are superior, it’s clear that trust will be a major issue. As Rebecca Wettemann, CEO of Valoir, notes, “No one wants to be the next McDonald’s” – a reference to the high-profile stumble of the tech giant’s AI tool last summer.
As companies proceed with caution about embracing AI, fear of messing up has become a significant barrier to adoption. With this in mind, investors and analysts will need to carefully assess the long-term potential of AI-powered tools before making any investment decisions.
Source: https://www.investors.com/news/technology/ai-stocks-artificial-intelligence-revenue-2025