Goldman Sachs TMT Conference: Wall Street's Enthusiasm for AI is High

At Goldman Sachs' annual technology conference, artificial intelligence became the absolute focus, igniting investor enthusiasm and clearly delineating a line of "having" and "not having" within the tech industry. Companies at the forefront of AI infrastructure, chips, and core model development are enjoying market favor, while others face immense pressure to prove the value of their AI strategies.

During the three-day "Goldman Sachs Communacopia + Technology Conference" held this week in San Francisco, the most striking market dynamic did not stem from the upcoming IPO frenzy but from a 48-year-old tech giant. Oracle's stock surged due to its future contract revenue expected to soar by 359%, with much of the growth attributed to its deal with OpenAI. This event vividly showcased the direct explosive effect of AI on market valuations.

The distribution of enthusiasm in the venue also confirmed this. The presentations by NVIDIA and OpenAI became the hottest events, with the main banquet hall fully packed 20 minutes before the speeches began, forcing investors to occupy three breakout rooms to accommodate everyone. In contrast, even the presentations by Meta and Alphabet (Google's parent company) only filled two breakout rooms. This stark contrast intuitively reflects the current focus of Wall Street capital.

For companies not directly building AI data centers, manufacturing AI chips, or developing AI models, the atmosphere at the conference was far less optimistic. This was especially true for software manufacturers, whose progress or lack thereof in AI is under strict scrutiny from investors. The message from Wall Street is clear: demonstrate your AI monetization capabilities, or risk being sidelined by the market.

AI Divide: A Tale of Two Tech Stocks

This conference highlighted the significant differentiation within the tech industry due to AI. For companies directly participating in the AI wave, attendees were in high spirits, while for others, especially traditional software manufacturers, a cautious or even pessimistic atmosphere prevailed.

"We are at a stage where software companies feel they must quickly change their narrative because customers are demanding it," said Matt Lucas, Managing Director of Goldman Sachs' Technology, Media, and Telecommunications Investment Banking Division. These companies are under the spotlight, with their AI progress being closely scrutinized.

Although Goldman Sachs Managing Director and software analyst Kash Rangan amicably stated on stage, "AI will not kill software; in fact, it will make the software industry thrive," the investors in the audience clearly did not share this enthusiasm. Several investors expressed their questions to software manufacturers were very simple and direct: How are customers using your AI features? Are they paying for it, or are they about to pay for it?

Monetization Path: From Cloud Services to Dating Apps

In response to investors' "AI interrogation," some companies began to provide specific answers, showcasing their clear paths to converting AI into revenue.

The speech by Thomas Kurian, head of Google Cloud, attracted the attention of the entire audience as he explicitly stated that Google "has already made billions of dollars through AI," detailing how the company profits from AI infrastructure and agent products Almost every slide he presented was photographed by the audience on site, demonstrating the market's extreme desire for clear AI monetization cases.

Other companies are also striving to prove their AI value. Customer interaction software manufacturer Twilio discussed in a closed-door meeting how its AI agent tools enhance revenue through features like text-to-speech. A company spokesperson stated, "As of last quarter, the annualized revenue of the 10 largest AI startup clients we established over the past three years has reached six figures, with some exceeding seven figures."

George Arison, CEO of dating app Grindr, stated that its latest AI feature will generate a list of "hot potential matches" for paid users by scanning all conversations on the site, thereby driving its premium subscription service. As Matt Lucas said, "Businesses are still exploring how and at what speed AI will change their operations, which has created some strategic tension within software companies."

Data Infrastructure: The "Shovel Sellers" in the AI Boom

Amid the scrutiny of AI monetization capabilities, one type of company has garnered the unreserved favor of investors: database companies. Enterprises like Databricks, Snowflake, and MongoDB enjoyed a "star-studded" treatment at the venue.

Their role in the AI ecosystem is clear and critical: supporting AI infrastructure and classifying, querying, and analyzing the massive amounts of data generated by AI. As the "shovel sellers" in the AI gold rush, their value has been fully recognized by the market.

The performance of the capital markets also confirms this. This year, Snowflake's stock price has risen by 43%, and MongoDB's stock price has increased by 37%. Meanwhile, Databricks recently completed a $1 billion funding round and disclosed that its AI product's annualized revenue has exceeded $1 billion. The enthusiasm of investors for these data infrastructure companies reflects that in the AI era, data processing capability is regarded as one of the core assets