The Earnings Double I Found While Traveling With AI
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| By Michael A. Robinson |
Dubrovnik, Croatia — In a hat-tip to John Steinbeck’s “Travels with Charley,” I’m calling today’s tech-investing piece “My Travels with Chad.”
Chad’s my nickname for ChatGPT, the AI tool that’s quietly taken over the world.
I consult Chad all the time at home in California. And I just learned that Chad is great to take around the world, too.
My wife and I used him during our two-week tour of Croatia, Greece and Italy for our 30th anniversary.
In fact, it’s how we ended up here at Buza Bar, a unique spot carved into the rocky cliffside of the Adriatic Sea.
We sat at Buza, sipping drinks and enjoying the gorgeous blue waters and the old city below.
Our newfound reliance on Chad shows just how AI is changing our daily lives.
Whether for shopping, finance or travel, Chad and other bots are there to help.
Imagine getting the chance to invest in ChatGPT, which is valued at $500 billion.
For now, at least, keep on dreaming. Shares of its owner, OpenAI, remain in private hands.
That’s OK, though. Because today, I want to show you a tech leader that just got an estimated $50 BILLION contract with Chad’s owner and is on pace to double its earnings in as little as two years.
AI’s Role in Travel
With Chad’s help, my wife and I found a restaurant in Florence where we had one of best meals of our lives.
He also verified the authenticity of an art dealer and a glass sculpture we purchased during our last day in Venice.
Perhaps our favorite find was a rustic winery off the beaten path outside of Katakalon, Greece. Our cruise ship had docked there the night before.
We blew off an official tour from our luxury cruise line, Seabourn, and used Chad to guide us around town. That’s how we ended up at Mercouri Estate, family-owned since 1864.
I could go on. But you get the point. Chad has changed the way Tracy and I travel. And we’re far from the only ones.
In a 2024 survey of 1,000 travelers, more than 22% said they used AI to plan or assist with travel. That’s up from 16% in 2023, for a 37.5% increase in just a year.
Other experts estimate that roughly 40% of travelers around the world have used AI-based tools to help with travel plans.
Tools like ChatGPT certainly have their place when it comes to travel. For starters, they can research and inspire ideas.
Once a destination is picked, the bot can create personalized travel plans, complete with pre-travel checklists.
AI can also offer tips on unique places to visit like Buza Bar in Dubrovnik or a rustic winery in Greece.
In other words, much like it’s doing to other industries, AI is changing the way we travel.
No wonder the company behind Chad, OpenAI, has achieved such a historic rise. It now boasts some 800 million active weekly users.
That’s pretty impressive for a technology that only launched three years ago this month!
To keep growing, the startup is buying tons of computing power.
In fact, it just struck a deal with one of the world’s top chipmakers.
This one’s been a quiet force behind advances in digital tech for decades.
There’s Real Money in AI’s Physical Presence
That company is Broadcom (AVGO).
Based in Silicon Valley, Broadcom quietly powers the physical backbone of the AI economy — from hyperscale data centers to the chips inside next-gen servers.
It operates in more than 30 countries and serves a range of sectors from data centers to wireless to autos.
Of course, these days Broadcom is focused on AI. Which brings us back around to its new deal with OpenAI …
In simple terms, Broadcom is building the high-speed data highways that OpenAI’s models will run on.
And they’ll need a lot of them.
The first wave of these AI systems will roll out in 2026 and ramp all the way through 2029.
Neither firm has said how much the deal is worth.
But they did reveal it covers 10 gigawatts of AI power — about the output of a dozen coal-fired plants.
At that scale, industry sources say the pact could easily be worth in the range of $10 billion to $50 billion.
With the cost of AI chips rising fast, I believe $50 billion is a modest forecast.
And that’s not the only big win on Broadcom’s board. AI startup Anthropic just expanded its collaboration with Google — another project built on Broadcom’s tech.
The deal is a vote of confidence in Google’s advanced hardware and Broadcom, which is the primary hardware firm in this pact.
The Backbone of Digital Connections
In fact, Broadcom isn’t merely an innovator.
It’s the backbone of digital connections.
You see, it makes chips and controllers that manage how data flows within a server. And when you scale up to a data center, Broadcom becomes even more crucial.
Its chips are inside network switches that direct packets of data between servers. For large-scale systems, Broadcom provides things like optical devices and other gear that enable high-speed data to move over fiber optic lines.
The firm even offers network management and monitoring software. This helps control how data flows. That way, traffic doesn’t get caught in a bottleneck.
As my travels with Chad show, we’re seeing AI creep into nearly every part of our lives, with hundreds of millions of us using it often.
And behind the scenes, Broadcom plays a key role in the rise of AI.
It’s no wonder earnings are doing so well.
Over the last three years, earnings growth averaged a respectable 18%. Most recently, though, they doubled to 36%.
At that rate, Broadcom would achieve an earnings double in just two years.
And when earnings rise, stock prices often do, too.
Add it all up and you can see that this is a great way to invest in AI for the long haul.
Best,
Michael A. Robinson
P.S. I was years early on Nvidia, in 2016. And just last week, it became the first company to surpass $5 trillion in market cap.
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