'Generative AI Quietly Tamp Down Expectations' - The Information
Portfolio Pulse from Benzinga Newsdesk
Executives and staff from major cloud providers including Microsoft, Amazon Web Services, and Google have indicated that customers are cautious about increasing spending on new AI services due to the high costs associated with running the software. This suggests a tempering of expectations around the adoption and financial impact of generative AI technologies in the short term.

March 12, 2024 | 2:03 pm
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Amazon Web Services faces cautious customer spending on new AI services due to high operational costs, potentially impacting short-term growth expectations for its AI offerings.
Amazon Web Services (AWS), as a leading cloud provider, could see a negative impact on its short-term growth expectations for AI services due to customer caution around spending. The high costs of running AI software are a significant barrier, potentially leading to slower adoption and reduced revenue growth from these services in the near term.
CONFIDENCE 85
IMPORTANCE 70
RELEVANCE 80
NEGATIVE IMPACT
Google's short-term growth prospects for its AI services could be negatively impacted by customer caution in increasing spending on these services, attributed to the high costs of operation.
Google, a major player in AI and cloud services, faces potential short-term growth challenges for its AI offerings due to customer concerns over the high costs of running AI software. This caution in spending could lead to slower adoption rates and negatively impact revenue growth from AI services in the short term.
CONFIDENCE 85
IMPORTANCE 70
RELEVANCE 80
NEGATIVE IMPACT
Microsoft's revelation that customers are cautious about increasing spending on new AI services due to high costs could temper expectations for its AI-driven revenue growth in the short term.
Given Microsoft's significant investment in AI technologies, any indication of customer hesitation or reduced spending in this area could negatively impact anticipated revenue growth from these services. The high costs associated with running AI software are cited as a primary concern, which could lead to slower adoption rates and, consequently, a negative short-term impact on Microsoft's stock.
CONFIDENCE 85
IMPORTANCE 70
RELEVANCE 80