Emerging AI Investment Opportunities Beyond Big Tech

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The ongoing artificial intelligence (AI) revolution, described as the “biggest platform shift since electricity,” is predicted to create lucrative opportunities for smaller tech firms, according to Clare Pleydell-Bouverie, co-lead fund manager at Liontrust Asset Management.

In an interview with CNBC, Pleydell-Bouverie emphasized that the dominant players of the last tech cycle—referred to as the “Magnificent Seven,” which includes Alphabet, Amazon, Apple, Meta, Microsoft, Nvidia, and Tesla—may not necessarily lead in this new phase of technological transformation. Instead, emerging firms focused on AI applications and infrastructure are poised to become significant players.

“This year, we’ve concentrated on the AI infrastructure layer, which is essential for scaling this technology,” Pleydell-Bouverie stated. She highlighted sectors like silicon chip production, semiconductor equipment manufacturing, and network infrastructure as critical to enabling AI growth. Companies like Broadcom, Amphenol, and Arista Networks are vital in building the foundational layers of AI’s technological stack.

The “stack,” as described by Pleydell-Bouverie, includes several layers:

  1. AI Infrastructure: Firms providing hardware and connectivity, such as chips, cables, and networks.
  2. Foundation Model Providers: Companies creating large-scale machine-learning models, which she characterized as highly competitive and commoditized.
  3. AI Engineering Firms: Those enabling businesses to integrate AI into their operations and services.

While the infrastructure layer currently holds the most value, Pleydell-Bouverie foresees this shifting toward application and integration in the near future.

Nvidia’s Strategic Position in AI
Nvidia remains a standout in the AI space, which Pleydell-Bouverie compares to Apple’s dominance during the smartphone revolution. However, she argues that Nvidia is often misunderstood as merely a chip provider.

“Nvidia is positioning itself as the operating system for the next generation of AI-infused software,” she noted, pointing to the company’s strategic shift toward integrating software and hardware to power AI applications. Nvidia’s shares have surged by over 180% in 2024, fueled by demand for its advanced AI chips like Blackwell.

Pleydell-Bouverie sees Nvidia as the primary beneficiary of the AI boom in 2025, likening its current trajectory to Apple’s rise under Steve Jobs, who combined hardware innovation with software integration to dominate the tech landscape.

As AI continues to redefine industries, investors are encouraged to look beyond traditional Big Tech giants and explore opportunities in emerging firms that are reshaping the AI ecosystem.

 

U.S. Secures Preliminary $225M Deal with Bosch for Chip Production Grants

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The U.S. Commerce Department announced a preliminary agreement with German auto supplier Bosch for up to $225 million in subsidies to manufacture silicon carbide (SiC) power semiconductors in California. These semiconductors are vital for electric vehicles and other industries.

The funding will contribute to Bosch’s planned $1.9 billion investment to upgrade its Roseville, California, facility to produce SiC power chips. Additionally, the department has proposed offering Bosch approximately $350 million in government loans to support the project.

This initiative draws from the $52.7 billion fund established in 2022 to bolster U.S. semiconductor production and research. Bosch aims to begin producing SiC chips on 200-millimeter wafers at the Roseville facility by 2026. These chips are key components in automotive, telecommunications, and defense sectors, helping improve energy efficiency in electric vehicle (EV) operations and charging.

The agreement follows Bosch’s acquisition of TSI Semiconductors in 2023, a move Bosch indicated would depend heavily on federal funding. Bosch, like other automotive suppliers, faced significant challenges during the semiconductor production disruptions in Asia exacerbated by the COVID-19 pandemic.

This deal comes shortly after a similar preliminary agreement in October with Wolfspeed for $750 million in grants for a silicon carbide wafer plant in North Carolina. Once fully operational, the Bosch facility could account for over 40% of U.S.-based SiC device manufacturing capacity, the department stated.

Paul Thomas, Bosch North America’s president, highlighted that the Roseville facility will enable local production of silicon carbide semiconductors, supporting U.S. electrification goals. California Representative Doris Matsui, a co-author of the 2022 semiconductor funding law, praised the grant, emphasizing its role in advancing clean mobility and electric vehicle technologies.

 

Tesla Introduces “Actually Smart Summon” Feature in China

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Tesla has launched its “Actually Smart Summon” feature in China, an advanced autonomous driving capability for vehicles equipped with Enhanced Autopilot or Full Self-Driving systems.

This feature allows Tesla vehicles to drive autonomously from parking lots to a designated nearby location within the driver’s line of sight, providing greater convenience for car owners in crowded or challenging parking situations.

Tesla China announced that the feature will be delivered to customers via over-the-air software updates, making it easily accessible for existing Tesla owners with compatible systems.