AI boom will send ‘tech bears back to their caves,’ tech analyst Dan Ives says

AI “is the biggest transformational tech trend, which is why I believe we’re in the early stages of the next tech bull market,” Wedbush Securities managing director Dan Ives told Bloomberg TV on Monday. “That’s going to send the bears back into their caves in hibernation mode.”

Ives went on to call AI the biggest technology development since the internet. What made him particularly eager to sing AI’s praises was his argument that tech companies were starting to finally reap real revenue from their AI businesses. Microsoft, in particular, he said had proven as much in its earnings last week. 

Ives was unbothered by companies like Meta and Alphabet, whose stocks dipped last week after their disappointing earnings that he attributed mostly to economic factors like the rise of the 10-year Fed rate. 

“Big Tech was an A- this week in terms of the actual fundamentals,” Ives said. “The stocks reacted C+.”

Meta’s stock tumbled 3% following its third-quarter earnings after executives said the Middle East crisis made for an uncertain ad market that could affect the company’s revenue for the remainder of the year. 

Alphabet has fallen 10.3% since its high on Tuesday after its cloud division missed analyst expectations for revenue. Last week, after the stock dropped, Ives said the selloff was overblown and that owning Alphabet stock for its cloud business, instead of its extremely lucrative ad business, was like “rooting for Michael Jordan to play baseball.” 

On Monday, he added that the “Alphabet selloff was just a massive head scratcher.”  

Third-quarter ad revenue across Alphabet, which owns Google and YouTube, was $59.7 billion, up 9.5% from the same period last year and above analyst expectations. Overall, Alphabet had $76.7 billion in revenue, an 11% increase…