In December 2023, UBS researchers published a report on enterprise AI spending intentions, surveying IT executives at approximately 130 organizations regarding their AI plans across various layers, including chip, model, cloud infrastructure, data, security, and application software.
After more than six months, UBS is now presenting updated enterprise feedback, focusing on the incremental changes from November 2023 to May 2024.
In terms of individual companies, the survey’s results showed “a very positive read-through” for Microsoft (NASDAQ:MSFT) and a bullish sentiment for Nvidia (NASDAQ:NVDA) at the GPU layer.
“Among the cloud infrastructure providers, Microsoft has maintained and actually even materially expanded its lead for hosting AI workloads/GPUs,” analysts said in a note.
“Rival AWS held its ground in #2 while Google Cloud faded. Importantly, a full 66% of respondents expect AI initiatives to positively impact core on-premise to cloud migration plans,” they added.
At the applications layer, the planned roll-outs of Microsoft Copilot exceeded expectations, UBS noted. ChatGPT maker OpenAI leads in the creative AI space, and Microsoft's GitHub Copilot has expanded its lead in the code generation market.
The survey also indicated a stronger demand for internally-facing AI applications, which is a positive indicator for ServiceNow (NYSE:NOW).
The survey’s findings showed favorable trends for several other software firms, including Adobe (NASDAQ:ADBE), Databricks, Snowflake (NYSE:SNOW), and Amazon Web Services (NASDAQ:AMZN).
Overall, the biggest change from the November survey is that 52% of respondents have now gone live with at least one GenAI use case, up from 39% six months ago. However, only 10% are in production at scale, with the remaining 90% expected to reach scale by 2025, shifting the ramp timeframe from the second half of 2024 to 2025.