In a recent Wall Street survey, Google Cloud surpassed Microsoft (MSFT.O) and OpenAI to take the lead in the selection of 'most strategically significant' AI suppliers.

Budget changes. With the holidays approaching, technology procurement heads at major enterprises are busy prioritizing technology spending plans for 2025. These budget adjustments may indicate potential changes in market share and spending direction.

Despite OpenAI and Microsoft being widely recognized in the AI field, a recent CIO (Chief Information Officer) survey shows that Alphabet (GOOGL.O) is rapidly emerging in the competition for corporate AI spending.

Piper Sandler's 2025 CIO survey was released last weekend, which interviewed 81 CIOs to understand their budget priorities regarding different suppliers and technology fields.

'The technology industry will experience dynamic development in 2025,' wrote Piper Sandler's analysis team, 'Generative AI is transitioning from the testing/planning phase to the implementation phase, driving growth in cloud computing spending.'

Analysts point out that 87% of CIOs expect an increase in IT budgets for 2025, the highest percentage since the survey began in 2020.

Compared to the previous two surveys, Google Cloud's popularity has significantly increased. In the selection of the 'most strategically significant' AI suppliers, Google Cloud received 27% support, up from just 15% six months ago. Meanwhile, former leader Microsoft's support rate dropped from 33% to 24%.

In the ranking of AI infrastructure providers, Google Cloud also ranks first. When asked which cloud company they plan to test or implement AI projects with next year, 50% of respondents chose Google Cloud.

Overall, this is good news for major cloud computing infrastructure providers. The rising interest in AI applications and projects has led to increased spending intentions among all suppliers, including Microsoft Azure, Amazon AWS, Google Cloud Platform (GCP), and Oracle Cloud Infrastructure (OCI), compared to six months ago.

This trend is also beneficial for the parent companies of these cloud computing firms—Microsoft, Amazon (AMZN.O), Alphabet, and Oracle (ORCL.N).

Piper's semiconductor analyst Harsh Kumar believes this is also a significant boost for Nvidia (NVDA.O).

All cloud companies are major clients of Nvidia's AI chips. According to analysts, Nvidia holds over 70% of the AI GPU (Graphics Processing Unit) market. Kumar predicts that by 2028, the AI chip market size will exceed $500 billion.

If the budget plans of CIOs are realized, 2025 will be a significant year for AI development. Investors have begun to pay attention to this trend, with Alphabet's stock price rising nearly 15% this month.

Article shared from: Jin Shi Data