Wedbush: AI-driven cloud service transformation, Microsoft, Amazon, Google, and Palantir race for the new track

Zhitong
2025.05.09 12:33
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Wedbush Securities' latest research report points out that artificial intelligence technology is deeply reshaping the cloud computing industry, with companies like Microsoft, Amazon, Google, and Palantir taking the lead. Over 15% of global cloud services have integrated AI features, driving vendors to incorporate more AI models for revenue growth. It is expected that by 2025, the capital expenditure of tech giants will reach $325 billion. Palantir has performed outstandingly in enterprise-level AI solutions, potentially exceeding market expectations. Despite the optimistic outlook for AI, the report also warns that the price-to-earnings ratios of AI-related stocks have significantly surpassed historical averages

According to the latest research report from investment bank Wedbush Securities, artificial intelligence technology is deeply reshaping the cloud computing industry landscape, with companies like Microsoft (MSFT.US), Amazon (AMZN.US), Google (GOOGL.US), and Palantir (PLTR.US) seizing the initiative. The analysts at the firm emphasize that over 15% of global cloud services have now integrated AI features, with this technology shifting from an "optional add-on" to the core driving force of cloud projects, prompting vendors to achieve revenue growth at lower costs by integrating more AI models into cloud products.

The report predicts that despite uncertainties in the macroeconomic environment, corporate investments in AI and cloud computing will continue to increase. Tech giants represented by Microsoft, Google, and Amazon are expected to reach capital expenditures of $325 billion by 2025, a year-on-year surge of 40%.

In addition to traditional cloud service providers, data analytics company Palantir has been specifically highlighted by Wedbush. Analysts point out that the company is becoming a "hidden champion" in vertical tracks with its enterprise-level AI solutions in healthcare, finance, and manufacturing. As enterprise AI use cases transition from pilot programs to large-scale deployment by 2025, Palantir's technology implementation speed may exceed market expectations.

Wedbush believes that AI technology will drive a turning point in the software industry: "If the past decade was about building infrastructure for cloud computing, the next decade will be the era of AI-driven software revolution." Analysts liken the current software industry to moving from the "party preparation stage" to "dance floor revelry," with Microsoft, Amazon, and Google becoming the most direct beneficiaries due to their "computing power + data + application scenarios" triad advantage.

Despite the optimistic long-term outlook for AI, the report also highlights potential risks: the current price-to-earnings ratio of AI-related stocks in the Nasdaq 100 index has reached 35 times, significantly higher than the ten-year average of 28 times. If the commercialization progress of enterprise AI projects falls short of expectations, it may face valuation adjustment pressure. Investors need to focus on the actual conversion rate of enterprise AI spending in 2025, rather than merely the capital expenditure figures

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