As the new year begins, it is evident that market momentum and innovation will continue to be driven by artificial intelligence (AI). Within just three trading days of 2025, shares of major tech companies NVIDIA, Arm, and TSMC have already been observed to rise by 11%, 19%, and 11%, respectively. Additionally, a 10% increase has been reported by ASML, highlighting the growing significance of AI in shaping the economy. These early gains are seen as a testament to the enduring and expanding role AI is expected to play throughout 2025, according to Jean-Paul van Oudheusden, Market Analyst at eToro.
US AI Start-ups Raise $97 Billion in 2024
The surge in AI funding shows no sign of slowing down. In 2024, early-stage AI companies in the United States secured an impressive $97 billion in funding, accounting for nearly half of the $209 billion raised by all American start-ups combined, according to PitchBook. European start-ups also capitalized on the AI boom, raising $62 billion, with a quarter of that amount directed towards AI ventures. A significant portion of this funding came from private sources, with major players like Elon Musk’s xAI, OpenAI, and Anthropic leading the charge in the US. In Europe, Mistral AI is also emerging as a key competitor. These developments further highlight the US as a global hub for AI innovation and investment.
Towards an AI Assistant for Everyone
The growing interest in AI is taking center stage at the Consumer Electronics Show (CES) in Las Vegas. Major tech companies are unveiling products such as laptops, TVs, and displays that showcase AI-powered assistants now within reach of everyday consumers. While challenges remain in perfecting these technologies, NVIDIA CEO Jensen Huang’s keynote speech at CES confirmed that the AI revolution is imminent. In the near future, users will be able to interact with screens that provide real-time data, while humanoid robots will take on increasingly complex physical tasks, though their development is expected to take more time.
NVIDIA, Arm, and TSMC Remain Unassailable for Now
Central to the success of AI technology is the need for immense computing power. This demand is being met by companies like NVIDIA, Arm, and TSMC. NVIDIA’s advanced chips, referred to as “AI factories,” are manufactured by TSMC based on Arm’s designs. Together, these companies form a powerful trio that is driving the AI revolution. Their dominance has attracted not only end-users but also investors, with major tech giants like Google, Amazon, Apple, Meta, and Microsoft increasing their combined market capitalization by an astounding $8 trillion since the launch of ChatGPT in autumn 2022.
Investors Cannot Ignore AI in 2025
The AI race extends far beyond securing funding and developing hardware; it is also about attracting top talent, fostering innovation, and creating the most conducive environments for technological breakthroughs. According to PitchBook, Europe has already fallen behind in this race, with many start-ups in traditional sectors struggling to secure the necessary funding. As a result, investors in 2025 will need to prioritize AI to stay ahead of the curve and capitalize on its vast potential.
News Source: Golin Mena
