Recent reporting suggests $ACN has capped AI budget at $29 per month per employee as some employees were spending upwards of $1000. This adds another wrinkle to the AI story. As earnings expectations rise and companies are trying every possible way to reign in costs, how much are they willing to spend on AI on a continuous basis? $NVDA$AMD$AVGO$MU might be saying their is insatiable demand for AI tools but there's other side of story where companies are unable to afford token costs and are capping/cutting on AI expenses. If AI costs which companies are willing to take on are capped, will the frontier model companies be able to grow their revenues at a rate which investors are expecting? And then that leads to questions further down the chain? If usage slows, how much of the buildout in progress and projected is truly needed? That is exactly the question which $IT was asking last week. That is one of the reasons why $CRWV bond yields spiked last week !! Again urge all investors caution before buying every dip. ✌️✌️
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2 Comments
Dividendmoney @compoundculture · 6h
Great for ACN, not great for Ai stocks.
Scott S@scottsinvesting · 6h
I’ve been hearing similar stories from tech folks I know here in the SF Bay Area. I expect cap per seat AI budgets like ACN’s will increase over time, but primarily due to less seats being needed, eg. reduced headcount.
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