AI Exposure and Growth Outlook

UBS maintains a conviction in AI as a long-term growth driver, citing the rise of consumer agentic AI and strong cloud monetization. Despite recent stock declines driven by higher-than-expected US inflation, the bank favors remaining invested in AI across the value chain.

Key Takeaways

• 1.Consumer agentic AI is emerging as the next significant growth driver for the technology sector, complementing enterprise demand.
• 2.Broad-based supply bottlenecks and price increases in AI-related components (CPUs, packaging) continue to underpin the AI supply chain's performance.
• 3.Robust monetization evidence, with cloud provider growth reaching 40% YoY, is helping to justify high capital expenditure levels in AI.

Table of Contents

• Thought of the day
• Consumer agentic AI may be the next growth driver
• Supply bottlenecks should continue to underpin the performance of the AI supply chain
• What to watch: 14 May
• Caught our attention
• Market update
• Global asset class preferences definitions
• Appendix

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