Three years after OpenAI released ChatGPT, artificial intelligence has become the dominant driver of U.S. stock market gains, according to Bloomberg. The technology has fueled a surge in Big Tech shares, created new market leaders, and left companies considered at risk of AI disruption struggling to keep pace.
The S&P 500 has risen 64% since the launch of ChatGPT on Nov. 30, 2022, with the seven largest tech companies — Nvidia, Microsoft, Apple, Alphabet, Amazon, Meta Platforms, and Broadcom — accounting for nearly half of that growth, Bloomberg data shows. Analysts say the rally underscores the market’s top-heavy concentration in AI-driven stocks.
Nvidia has been the biggest winner, with shares up 979% since ChatGPT’s release. The chipmaker’s graphics processing units dominate the AI computing market, and its revenue is projected to exceed $200 billion this year, Bloomberg reports. Nvidia’s net income is expected to top $170 billion, surpassing the combined profits of roughly a third of S&P 500 companies.
Big Tech’s gains have also driven unexpected beneficiaries in the energy sector. Companies such as Vistra, NRG Energy, and Constellation Energy have surged as AI computing infrastructure has boosted power demand, Bloomberg notes. Nuclear energy startups have similarly benefited from renewed interest in high-capacity power sources.
However, not all companies have prospered. Stocks deemed vulnerable to AI disruption, including staffing firms, software makers, and online education companies, have fallen sharply. LivePerson and Chegg have each lost 97% of their value since November 2022.
The concentration of gains in a small number of companies has made the S&P 500 more top-heavy. The seven largest firms now account for about 35% of the index’s market capitalization, up from roughly 20% in late 2022, Bloomberg data shows.
Despite concerns about overconcentration and market risks, analysts say AI remains the defining theme of the current bull market. “Every bull market has a dominant theme, and the dominant theme of this bull market is technology and AI,” said Keith Lerner, chief investment officer at Truist Advisory Services.
