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Google-Apple partnership shows hardware's importance amid the AI boom

Jun 17, 2024 - businessinsider.com
The article discusses the rising importance of hardware in the tech industry, with Wall Street increasingly favoring hardware over software. The shift is driven by the boom in generative AI, which requires massive data-center footprints for training, leading to unique partnerships between tech giants like Apple and Google. Hardware tech stocks have outperformed software tech stocks by 30 percentage points this year, with Nvidia and chipmaker Broadcom seeing significant gains. Private-equity giant Blackstone is also betting big on data centers.

In other news, the article highlights the potential impact of the next U.S. presidency on Elon Musk's businesses, the increasing age of America's millionaires, and the role of AI in the advertising industry. It also mentions the upcoming Cannes Lions ad festival and the IRS quarterly tax filing deadline.

Key takeaways:

  • Hardware is becoming increasingly important in the tech industry, particularly in the field of generative AI, leading to unique partnerships between tech giants like Apple and Google or Oracle and Microsoft.
  • Wall Street has taken notice of the increased importance of hardware, with hardware tech stocks outperforming software tech stocks by 30 percentage points this year.
  • Nvidia and chipmaker Broadcom are examples of companies that have seen significant growth, with Nvidia close to catching Microsoft as the most valuable company in the world and Broadcom potentially becoming the next $1 trillion company.
  • Private-equity giant Blackstone is also investing heavily in hardware, specifically data centers, with a $50 billion portfolio and plans to double it.
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