Google Parent Alphabet Sold 79% of Its Stake in Snowflake and Is Piling Into This Supercharged Artificial Intelligence (AI) Stock Instead

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For the better part of the past two years, artificial intelligence (AI) has dominated headlines on Wall Street — and with good reason. The capacity for AI-driven software and systems to learn and evolve over time without human intervention gives this technology utility in most industries around the globe.

Though estimates vary wildly, as you’d expect for a potentially game-changing technology, the addressable market for AI should yield numerous winners. In Sizing the Prize, the analysts at PwC forecast a 26% increase ($15.7 trillion) to global gross domestic product by 2030 solely from the AI revolution.

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Despite this leap forward in innovation, Wall Street’s smartest and most-successful investors have mixed feelings about AI stocks, as Form 13F filings demonstrate. A 13F is a required quarterly filing for institutional investors with at least $100 million in assets under management (AUM) that allows investors to see which stocks the brightest asset managers are buying and selling.

However, 13Fs aren’t just limited to prominent billionaire money managers and hedge funds. Some of Wall Street’s most-influential businesses have investment arms and are required to file a 13F if they hold more than $100 million in AUM.

Though today, Nov. 14, marks the deadline for 13Fs to be filed for the September-ended quarter, Google parent Alphabet (NASDAQ: GOOGL)(NASDAQ: GOOG) released its 13F a few days early. As of the end of September, Alphabet was overseeing a 42-stock, $1.84 billion portfolio.

Though Alphabet’s brightest investment minds weren’t all that active during the third quarter, two trades on the AI front absolutely stand out.

The most eye-popping move made by Alphabet during the third quarter was to send 421,050 shares of cloud-data warehousing stock Snowflake (NYSE: SNOW) packing, which represents a 79% reduction from where things stood at the end of June. Snowflake had been a top-10 holding by market value during the second quarter, but this is no longer the case for Alphabet.

The good news for Snowflake is that it still possesses a couple of well-defined competitive advantages that bode positively for the company over the long run. For instance, its cloud-based platform is built atop the most-popular cloud infrastructure services. This allows its clients to seamlessly share data across competing platforms, which might otherwise be challenging. It’s also incorporated AI and machine-learning capabilities into its platform to allow customers to create generative AI applications and build large language models.

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