Morgan Stanley sees Apple’s decision to refocus on generative Artificial intelligence (GenAI) from its electric vehicle (EV) effort, known as effort Titan, as a wise and constructive move. This redirection, as reported by Bloomberg News, took many of the project’s almost 2,000 personnel by surprise. Under executive John Giannandrea, staff members of the Special Projects Group (SPG) will be moving to AI projects. According to Morgan Stanley analysts, Apple will be able to demonstrate cost discipline and strategic focus by reallocating resources to other important initiatives as a result of this shift towards GenAI.
Morgan Stanley praised Dell Technologies’ performance in the AI space. Noting that the company’s AI server backlog and orders greatly exceeded projections. Consequently, Morgan Stanley raised Dell’s price objective and once again recognized it as a Top Pick. Ahead of its fiscal first quarter 2024 results, Broadcom, another tech behemoth. Saw Bank of America lift its price target because to the momentum in the AI sector and the company’s upcoming AI Investor Day.
In contrast, Hewlett Packard Enterprise was downgraded by Wells Fargo despite the company’s recognition of its strategic position in the convergence of AI and high-performance computing, owing to worries about the rate of revenue conversion and underlying profit margins.
Lastly, Macquarie analysts anticipate 2024 to witness significant failures in generative AI technologies. Citing recent incidents like ChatGPT’s malfunction and criticism of Google’s Gemini project for generating historically inaccurate images. These events underscore the challenges and controversies surrounding the rapid development of AI technologies. Signaling a cautious outlook on the sector’s ability to navigate ethical and accuracy-related hurdles.
