Workflow
2 AI Stocks That Could Supercharge Your Portfolio
DOCNDigitalOcean(DOCN) The Motley Fool·2025-01-11 10:37

AI Industry Overview - The AI revolution is still in its early stages, with tech giants and startups heavily investing in AI infrastructure, exemplified by Microsoft's planned 80billioninvestmentinAIdatacentersthisyear[1]−TheindustryisshiftingfocusfromtrainingAImodelstoAIinference,ascurrenttrainingmethodsfacelimitationsandAI−generateddataisincreasinglyusedfortraining[3]Cloudflare′sAIStrategy−CloudflareisfocusingonAIinference,leveragingitsglobalnetworkofAI−capableserverstorunAImodelsclosetousersasquicklyaspossible[2][4]−Thecompany′sWorkersplatformsupportsawiderangeofAImodelsfortasksliketextgeneration,imageclassification,andtranslation[4]−CloudflareoffersanAIGatewaytohelpdevelopersmanageAImodelsrunningonthird−partyplatforms,withmostfeaturesbeingfree[5]−WhileAIiscurrentlyasmallpartofCloudflare′sbusiness,thecompany′sextensiveplatformandlargeuserbase(221,000payingcustomers,including3,200spendingover80 billion investment in AI data centers this year [1] - The industry is shifting focus from training AI models to AI inference, as current training methods face limitations and AI-generated data is increasingly used for training [3] Cloudflare's AI Strategy - Cloudflare is focusing on AI inference, leveraging its global network of AI-capable servers to run AI models close to users as quickly as possible [2][4] - The company's Workers platform supports a wide range of AI models for tasks like text generation, image classification, and translation [4] - Cloudflare offers an AI Gateway to help developers manage AI models running on third-party platforms, with most features being free [5] - While AI is currently a small part of Cloudflare's business, the company's extensive platform and large user base (221,000 paying customers, including 3,200 spending over 100,000 annually) position it well for future growth in AI [6][7] DigitalOcean's AI Approach - DigitalOcean, a traditional cloud computing provider, is expanding into AI with a focus on simplicity and accessibility for individual developers and small businesses [8][9] - The company acquired AI platform Paperspace in mid-2023 and is now offering GPU-backed virtual servers for AI workloads and a new GenAI platform for training and deploying AI agents [9][10] - DigitalOcean has over 600,000 paying customers, including more than 150,000 spending at least $50 monthly, and aims to capture a greater share of cloud spending as AI proliferates [11]