Over half of the U.S. population is aware of the AI chatbot ChatGPT, with nearly a third having used it. However, only 7% use it daily.

While ChatGPT is the leading AI tool, new AI applications are continually emerging. Many companies are still figuring out how to monetize AI, with some using the term “AI” mainly to attract investors or customers.

The adoption of groundbreaking technologies like AI, similar to the iPhone and e-commerce, is a gradual journey.

As AI becomes more integrated into various products, everyday usage will increase, leading to significant growth in AI stocks.

The belief that the AI trend has peaked is mistaken.

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More than half of the U.S. population has at least heard of AI chatbot ChatGPT. And nearly one-third of the population has used it.

On the surface, it looks like AI has already made a huge dent. However, when you look deeper… the story is quite different. Only around 7% of the U.S. population uses ChatGPT daily. Most people who reported using it only did so a handful of times.

And that’s only in the U.S. We have a higher percentage of ChatGPT users than any other country besides Denmark.

While ChatGPT is the most-used tool by far… there are new AI tools launching every day. They cover everything from translation to image generation, and even houseplant care—most of which have a fraction of the users ChatGPT has.

Companies are still trying to figure out how to use AI. Very few make money from it yet. And most of them, especially small-scale businesses, use the word “AI” to attract investors or customers.

Keep in mind that Big Tech giant Apple (AAPL) only sold 5 million iPhones in its first year. The iPhone couldn’t even consistently outsell the iPod for the next four years.

By 2013, though, Apple had sold 150 million units. Folks were quick to say that the iPhone had peaked.

A decade later, it sold 232 million units… or 43 times more than its first year.

The same thing happened on the e-commerce front. After the dot-com bubble burst in 2000, e-commerce controlled nearly none of U.S. retail. It took nearly 20 years for it to get to 10% market share.

Just one year later, partially thanks to the pandemic, e-commerce controlled 15% of all retail.

Of course, in each step of this growth story, people kept saying the same thing with the iPhone case, the surge is over.

Technology adoption is a journey, not an event and it often lasts longer than people expect. We’re just seeing the baby steps of a life-changing technology.

ChatGPT and other large language models (“LLMs”) aren’t fully packaged, ready-to-use end products. They’re more like an interface of AI technology.

Although they’re making life easier to some extent, these inventions are just tools right now. And only a handful of people that know how to use them have done so daily.

As new products integrate AI technology—and as we find new ways of using AI—we’ll see a jump in users.

And this time, they’ll be everyday users… not just one-time visitors.

The last time we saw anything like this, at least 10 different stocks soared 1,000% or more… while millions of Americans saw their stock portfolios devastated.

We can expect plenty of growth in AI usage from here… Conscious and beneficial usage in particular will bring money to AI stocks.

Anyone who believes the AI story has played itself out is mistaken.

Best regards,

Joel Litman & Rob Spivey

Chief Investment Strategist &
Director of Research
at Valens Research