The Future of Artificial Intelligence

By Shaquille Noel – Investment Analyst, Research & Analytics


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As the world becomes more digitized through technological advancement, so too will Artificial Intelligence (AI). AI is the ability of machines to independently perform tasks that would usually require human intelligence to complete. AI is becoming increasingly sophisticated at doing what humans do, but faster, more efficiently and at lower costs. General examples of these tasks include speech recognition, decision making, visual perception and translation between languages. In today’s world, AI applications are much more advanced and are imbedded through the applications in our devices and services we use.

In the past few months, the AI chatbot ChatGPT, built by American artificial intelligence research laboratory OpenAI, has been making headlines following a sharp uptake in usage of the technology. The success of the technology has now seen Microsoft, a longtime partner of OpenAI, incorporate the technology into its Microsoft Bing search engine. Since incorporating AI, page visits on Bing spiked 15.8% while Google visits fell almost 1% as reported by Reuters.

What Exactly is AI?

John McCarthy, American computer scientist and cognitive scientist, and one of the founders of the discipline of artificial intelligence, defined AI in 2004 as, “…the science and engineering of making intelligent machines, especially intelligent computer programs.” In essence, AI strives to replicate the intelligence of humans in machines. This intelligence includes auditory and visual cognitive ability, creativity and problem-solving skills.

AI is achieved by combining large amounts of data with fast iterative processing and intelligent algorithms, allowing the software to learn automatically from patterns or features in the data. In today’s world, through the advent of the internet, a quantum amount of data is readily available, providing a key ingredient to feed the machine learning quality of AI.

Harvard Business Review explained that AI really began to flourish between the periods of 1957-1974 as computers could store more information and became faster, cheaper and more accessible. Machine learning algorithms and practical applicability also improved. Developments and investments continued in the space over the years and it appears to be at another milestone of growth with the breakthrough of chatbots.

Industries Impacted by AI

While AI is primarily part of the technology landscape, it is applied in almost all industries and will effectively impact “every product of every company” according to Google and Alphabet’s CEO. While an actual timeline of how AI will be rolled out and developed is unclear, it appears inevitable nonetheless.


AI in finance leverages technology such as machine learning that mimic human intelligence and decision making to enhance analysis, investment management and protection of money. Natural Language Processing and chatbots are becoming more prevalent in the financial services industry to improve customer service and automate repetitive tasks. Advancement in fraud detection is another benefit of AI in finance as the technology can analyse transaction data to identify fraudulent activities such as money laundering. AI has the capability of quickly analysing large volumes of data to identify trends, evaluate risks and provide forecasts which will support decision making in the industry.


In Healthcare, AI and robotics have been ground-breaking in reshaping the way persons are diagnosed, treated and monitored. It is used for individuals to monitor and manage their health choice, early detection, diagnosis, treatment and end of life care. Health applications on personal devices such as a smartphone are one of the simplest yet effective ways that health is monitored as they track the daily activities of users and promote proactive management of healthy lifestyles. Consumer wearables and other medical devices are combined with AI technology to detect diseases and oversee early-stage disease care, enabling doctors and other caregivers to better monitor and detect potentially life-threatening episodes at earlier, more treatable stages.

According to the Global Newswire the AI healthcare market is expected to grow from USD14.6 billion in 2023 to USD102.7 billion by 2028; it is expected to grow at a compound annual growth rate (CAGR) of 47.6% during the forecast period. The adaptation of AI is likely to be boosted by the imbalance between the increasing requirements of improvised health versus the availability of healthcare workers which is already below demand.

Marketing & Sales

AI is well suited to adapt to the fast pace of Marketing and Sales by analyzing large amount of data such as customer buying patterns which would help companies personalize marketing to different customers. Forbes magazine explains that with AI-powered tools such as chatbots, predictive analytics and personalized email marketing, companies can streamline their operations, gather valuable insights and increase their reach. AI can further draft emails to specific audiences to create the desired effect of maximizing appeal. Chatbots would also be able to quickly respond to customer queries and provide solutions improving the communication between the customer and the entity.


According to a Deloitte’s survey on AI adoption in manufacturing, 93% of companies believe AI will be a pivotal technology to drive growth and innovation in the sector. The manufacturing sector is expected to continue investments geared towards accelerating the adaptation of emerging technologies to improve efficiency and safety. The headwinds presented by the pandemic in recent years including labor shortages and supply chain issues highlighted ways the sector could benefit from incorporating AI into their operations.

Smart manufacturing technologies remain at the forefront of manufacturing trends as manufacturers continue to explore innovative ways to improve their operations. A smart factory is a digitized manufacturing facility that uses connected devices, machinery and production systems to continuously collect and share data. The smart manufacturing practices used by smart factories are enabled by a variety of technologies including artificial intelligence.

Figure 1: Global Artificial Intelligence Market Size (by industry) (in 10 billion US dollars)

Source: Gartner

Investment in AI

Investment in AI remained tepid up until 2017 when it reached USD52.33 billion according to estimates from ‘Our World In Data’. In 2020 and 2021, investment in AI jumped to approximately USD125.15 billion and USD176.47 billion, respectively. The increase in investments in 2020 and 2021 were boosted by the COVID-19 pandemic as firms substantially increased their uptake in digital software and hardware to adapt their processes to account for the infectious disease. Over the period, mergers and acquisitions and private investment in the technology stood out.

Figure 2: Annual Global Corporate Investment In Artificial Intelligence (by type)


Many experts believe 2023 will be a defining year in the evolution of AI with the launch of ChatGPT showing the impressive capabilities of the technology. In March 2023, Microsoft introduced Microsoft 365 Copilot, which aims to blend AI into their existing suite of productivity tools including Outlook, Excel and Word. In February 2023, Google introduced Bard, their experimental conversational AI service. The Financial Times reports that Google is racing to upgrade their search engine through their latest AI project named, Magi, to compete with Bing. Elon Musk, co-founder and former member of OpenAI, has created a new AI company called X.AI Corp where he has so far been recruiting researchers with the goal of creating a rival effort to OpenAI according to the Wall Street Journal. Inc.’s cloud computing division announced new artificial intelligence offerings in April 2023, becoming the latest tech giant to cash in on generative AI, the technology behind ChatGPT. Amazon’s Amazon Web Services is targeting corporate customers rather than providing the service for the general public.

Investment Opportunities in AI

For investors interested in AI technology, a good start to investing would be in the tech companies which are primarily responsible for innovation in the sector. Microsoft is among the top contenders given their USD10 billion investment in OpenAI and the subsequent rollout of Bing with new AI-powered search features. Stocks from companies like Nvidia, IBM, and Amazon are also amongst the top companies to follow and consider for investing in AI.

Makers of medical devices are also an attractive area for investments. According to Seeking Alpha, in 2022, the US FDA approved 91 AI or machine-learning enabled devices to its list of such approved devices. More than 500 AI-enabled devices have been approved by the FDA since 1995 according to Margaretta Colangelo, an AI consultant at Insilico Medicine. Medtronic, Abbott, Johnson & Johnson and GE Healthcare were among the top medical devices companies in the world in 2022 based on revenue. Analytics firm GlobalData, believes that the AI-based products will grow to USD93 billion in 2023, up 12% from 2022.

Investors who prefer to gain more holistic or diversified exposure to the AI market at a relatively low cost can choose from a host of AI Exchange Traded Funds (ETFs). Exchange-traded funds (ETFs) are a type of index funds that track a basket of securities much like a mutual fund. ETFs like Global X Robotics & Artificial Intelligence ETF and ROBO Global Robotics and Automation Index ETF are among the top AI ETFs.

Like any investment investors need to look past the hype and excitement of AI and place more focus on the fundamentals and the outlook of the technology. While AI has been around for some time the development of the technology is still touted to be in its early stages. Implementation of AI may also take longer in some applications and industries than others so timing and knowing where to invest in the AI market is important. Investors also need to be wary of the regulations expected to be developed within the space which may slow the rollout of AI. Lastly, the acceptance of AI in society represents another hurdle to the technology should the human element be preferred in some industries and through the role it may play in displacing workers.


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