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C3 AI, BigBear.ai, SoundHound: AI-related stocks fall despite strong demand

The Yahoo Finance Live team discusses the decline in stock price for some AI-related stocks.

Video transcript

[MUSIC PLAYING]

- Welcome back, and turning now to our trending tickers this morning. Artificial intelligence stocks continue their climb on the hype around the technology, this as big tech names, like Microsoft, continue to drive news around the stocks after announcing a multibillion dollar partnership with OpenAI makers of chatGPT.

And Brad, we've been talking about AI in fits and starts. We got interrupted by this big banking panic last month, but ChatGPT has just remained this presence in the headlines. 3.4. The new version, 3.4, was just released a couple of weeks ago. Magnitude of order, just trouncing the previous version, which was only 3.52.

It's just incredible to see the gains. And now, we've seen Elon Musk and others calling for a pause. You can read into that however you like, maybe some ulterior motivations, maybe not, but this technology is here to stay and we're seeing it kind of evolve fits and starts in the investment arena too in some of these smaller stocks.

- Yeah. I'm taking a look at the YFi Interactive on our screen here in-studio. I believe you have it pulled up on your screen as well there, and you're taking a look at some of those AI-related stocks. And this is the move intraday here today. And so coming into this pre-market, we were seeing a concerted move higher. Now here, that has swung to the downside.

And one of the big news items last week that was driving a lot of the AI conversation, aside from Elon Musk's letter. And there you've highlighted the year-to-date as well. I mean, that move is, quite frankly, just bonkers. But as we think about some of the larger names that are intertwined within that, and they are data center, a lot of data center or semiconductor-type of plays, Nvidia video being one of them. Or on the generative AI front, a Microsoft and their $10 billion investment into OpenAI. That has been considerable.

And so the buzz around artificial intelligence certainly has been one of the major stories that has moved from the first quarter, now into the second quarter here of 2023, but it's a larger question of where the artificial intelligence of old will continue to be an actual margin generator for some of the companies like IBM, Big Blue out there, Intel, that had its own webcast last week and tried to continue to shore up confidence to its investors that it was going to have a major stake or a play in the game here.

At the same time, that they're ramping up spending on the fabrication process and capacity there. And so all of that considered, old AI, this is not your father's AI anymore. This is more of this new generative can basically write your term paper in a hot second if you wanted it to.

- And pass LSAT's as well.

- Right, and still have some cybersecurity type of approach to it.

- To do at night. Just one more quick look at the WiFi Interactive. Huge difference in the way-to-play, these companies here. You got the big ones, see Microsoft, Alphabet, Nvidia, even Baidu, and then just about everything else. Some huge variances in the market cap there, Brad.

- Absolutely.