So, you know how everyone's been talking about AI demand for what feels like forever? Well, according to Wedbush analyst Dan Ives, it's not just talk—it's actually getting stronger. He just got back from a trip to Asia, and he says what he saw there made him "incrementally more bullish" on the whole tech sector.
The big takeaway: there are "no visible cracks" in the current AI buildout cycle. Demand is accelerating across the supply chain, from Taiwan outwards, and it's not just about the chipmakers. Ives says this surge is creating a "bright green light" heading into earnings season, with the good vibes expected to ripple out to the software industry too.
Supply Chains Are (Surprisingly) Calm
Here's the part that might surprise you: for all the chatter about energy worries and raw-material issues in places like Taiwan, South Korea, and Japan, Ives says the supply side is actually pretty stable right now. He's not seeing any immediate red flags.
His estimate? There's a buffer of several weeks to a few months before any potential supply disruption could become a real problem. So, for the moment, the story is being driven by roaring demand, not by worries about whether companies can get their hands on the parts they need. It's a demand-pull market, not a supply-crunch panic.
The Software Rebound Is Real
Remember when software and AI stocks took a bit of a beating not too long ago? Ives calls that sell-off "the most disconnected" he has seen. His view is that a recovery is underway, and the companies that will really cash in on this AI wave are the hyperscalers and the enterprise software folks.
He name-checked a couple of key players as barometers for this trend: Palantir Technologies Inc (PLTR) and ServiceNow, Inc (NOW). The big cloud giants—Microsoft, Alphabet, and Amazon—are obviously central to the whole story as well.
Now, Ives isn't saying all the questions are answered. He acknowledges that concerns around actual software adoption still need to be validated. But his overall stance is pretty clear: we're still early. He described the AI cycle as being at "the top of the third" inning. In baseball terms, that means there's a lot of game left to play.
As for the stocks themselves, it was a slightly down day for some of the giants when this news was circulating. According to market data, Microsoft shares were down 0.44% at $420.94, Alphabet shares were down 0.75% at $339.11, and Amazon shares were down 0.63% at $248.99. Sometimes the market takes a breath, even when the fundamental story sounds as strong as this one.
