Columbia Business School professor Aswath Damodaran has challenged the prevailing market narrative that artificial intelligence infrastructure providers will remain the primary beneficiaries of the technology boom.
In a recent analysis, the valuation expert argued that the next dominant AI company will not be a chipmaker like Nvidia or a model developer like OpenAI, but rather an enterprise that successfully integrates AI into end-user applications to drive productivity gains.
Damodaran’s perspective offers a counterpoint to the current concentration of capital in semiconductor and data-center stocks.
While companies like Nvidia have seen valuations soar on the back of insatiable demand for AI chips, Damodaran suggests that the long-term value creation will shift toward firms that can demonstrate tangible efficiency improvements for businesses.
He views AI not as a job-eliminating force or a fleeting trend, but as a productivity enhancer that will replace specific roles while creating new economic value.
This view contrasts with the recent market focus on the "picks and shovels" of the AI revolution.