The rise of AI is obviously getting a lot of airtime, and rightly so, this is one of the ‘Megatrends’ that will remain in the spotlight for many years to come, however, for now, it’s the large, well-known beneficiaries of this theme that are attracting the most attention. The companies that run the cloud, Amazon, Google, Microsoft & Oracle, and the providers of processing power such as Nvidia (NVDA US), but there are many other companies in the space that MM should stay firmly across, Snowflake being one of those we already hold in the International Equities Portfolio, and while the position is up ~20%, it has underperformed.
In simple terms, Snowflake is a cloud data company that manages huge data sets, enabling query optimisation and a bunch of other things in a secure way – data is the foundation of AI, and Snowflake allows companies to use the power of AI without sharing their proprietary information with the world. We view this as a critical cog in the chain, but it’s a higher-risk play on the AI theme and how it will progress.
Snowflake reports quarterly earnings after market tonight in the US, obviously important for SNOW themselves, but equally so in looking at the trends around data consumption. We’ve seen the market underestimate the huge investment being pushed into the space, led by Microsoft and others, and we’ll get some good insight tonight into how this is all progressing.
- We hold a small ~3% position in Snowflake, which reports quarterly earnings tonight
MM is cautiously bullish SNOW US ~$US170
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