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Wall Street’s Biggest Bull Shines Spotlight On AI ‘Virtuous Cycle’
In the course of doubling and tripling down on what counts as the most bullish call on Wall Street, BofA's Savita Subramanian talked up a "virtuous cycle" set in motion by the AI gold rush.
I should be as clear as possible: Although Subramanian's especially bullish, you won't find too many top-down strategists willing to brave a bearish view on AI. Even Morgan Stanley's Mike Wilson likes the story, particularly as it relates to corporate efficiency, the hottest of hot topics on earnings calls l
Occurs to me that she has, almost surely, investigated planned efficiencies at BAC itself.
That’s all good but I’d argue Klarna using AI to ‘complement’ 700 customer services employees (and saving $40M per year) seems an even more direct way in which AI can improve productivity and profitability… and surely margin expansion is worth something to investors?
https://www.linkedin.com/pulse/from-hold-music-hero-how-klarnas-ai-chatbot-saved-40m-kamel-c6znc/
https://www.forbes.com/sites/quickerbettertech/2024/03/13/klarnas-new-ai-tool-does-the-work-of-700-customer-service-reps/?sh=246a155b5bdf
To convince me they need to use AI to permanently reduce staffing costs = FIRE people.
What do you think is the next step? Like, ‘complementing the workforce’ is stopgap to avoid scaring people/stakeholders…
Growth companies may choose to not hire more people as the business grows and existing employees attrit. Mature and over-staffed companies will do the RIFs.
Great article, have to figure how to use it to move cash to stocks/sectors.