There’s a New Line Forming in the AI boom, and Dan Ives Says Investors Are Standing at the Very Front, Not the End.

Tech analyst Dan Ives is doubling down on a simple message. The AI rally is real, it is early and it is nowhere near bubble territory. In a new analysis, he argues that investors are misreading one of the largest technology build-outs since the early internet era.

His reasoning starts with basic adoption. Talking to Yahoo Finance, he said only a small fraction of companies in the United States have adopted AI in a meaningful way, and global penetration is even lower.

That is nowhere near the saturation point that usually precedes bubbles. He frames the current surge as infrastructure demand rather than speculation, fuelled by enterprise deployment, government interest and an industry-wide shortage of advanced chips.

The comparison with the late 1990s, he says, does not hold up. During the dot-com period, the average tech stock traded at extreme multiples on very little revenue. Today’s leaders generate vast amounts of cash, operate at global scale and sell into real markets with real customers.

He points to Nvidia as the clearest example. Its hardware is in short supply because demand outpaces production, not because of hype. Companies such as Amazon, Google and Microsoft depend heavily on its chips to power their AI ambitions.

In the report, Ives highlights 10 companies he believes are central to the AI economy. Microsoft leads the list thanks to its enterprise reach and integration of AI into productivity tools.

Palantir stands out as essential software for governments and large organisations. Nvidia remains the dominant hardware engine, while AMD is poised to capture more share as demand grows.

Tesla appears on the strength of its autonomous technology strategy. Apple makes the list because whatever consumer AI becomes, Apple’s ecosystem will distribute it. Meta is credited for early AI investments that are beginning to convert into revenue opportunities.

Alphabet is included for its Gemini model and home-grown silicon. CrowdStrike and Palo Alto Networks represent cybersecurity, where AI is becoming the core defence layer for businesses.

Absent from the top tier are Amazon, Salesforce, IBM and Intel. Ives is not bearish on them. He includes all four in his broader “AI 30” universe. But he sees them as supporting players rather than category-defining leaders.

The overall message is clear. The AI cycle is still in its opening stages, and the companies that form the backbone of the ecosystem remain well-positioned for what comes next.