Consumer Reluctance Towards AI Shopping Decisions
Written by Emily J. Thompson, Senior Investment Analyst
Updated: 4 days ago
0mins
Source: Newsfilter
- Trust Deficit: According to Gartner's survey, only 11% of U.S. consumers are willing to let AI make purchasing decisions, indicating a significant lack of trust in AI shopping tools, particularly in low-stakes categories like personal care and household supplies.
- Preference for Supportive Tools: The survey reveals that 31% of consumers are open to AI narrowing choices for household supplies, while 28% are willing to do so for personal electronics, suggesting a preference for AI that aids in product research and comparison rather than making decisions autonomously.
- Accuracy Concerns: Among consumers who used AI for shopping, 54% reported needing to verify the accuracy of the information provided by AI, and 62% felt that the information was a waste of their time, highlighting accuracy as a critical challenge for brands.
- Passive Exposure vs. Active Adoption: While 72% of consumers state that generative AI appears in their internet and app usage, this passive exposure does not equate to active adoption, indicating that brands must enhance consumer control to build trust.
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Analyst Views on IT
Wall Street analysts forecast IT stock price to rise
11 Analyst Rating
4 Buy
6 Hold
1 Sell
Moderate Buy
Current: 161.180
Low
150.00
Averages
190.70
High
240.00
Current: 161.180
Low
150.00
Averages
190.70
High
240.00
About IT
Gartner, Inc. delivers actionable, objective business and technology insights. Its segments include Business and Technology Insights (Insights), Conferences, and Consulting. The Insights segment delivers independent, objective insight to leaders across an enterprise through subscription services that include on-demand access to published research content, data and benchmarks, and direct access to a network of research experts located around the globe. The Conferences segment is designed for information technology (IT) and business executives as well as decision-makers looking to adapt and evolve their organizations through disruption and uncertainty, navigate risks and prioritize investments. The Consulting segment serves chief information officers and other senior executives to optimize technology investments and drive business impact. It also provides solutions for a range of IT-related priorities, including IT cost optimization, digital transformation, and IT sourcing optimization.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
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Consumer Reluctance Towards AI Shopping Decisions
- Trust Deficit: According to Gartner's survey, only 11% of U.S. consumers are willing to let AI make purchasing decisions, indicating a significant lack of trust in AI shopping tools, particularly in low-stakes categories like personal care and household supplies.
- Preference for Supportive Tools: The survey reveals that 31% of consumers are open to AI narrowing choices for household supplies, while 28% are willing to do so for personal electronics, suggesting a preference for AI that aids in product research and comparison rather than making decisions autonomously.
- Accuracy Concerns: Among consumers who used AI for shopping, 54% reported needing to verify the accuracy of the information provided by AI, and 62% felt that the information was a waste of their time, highlighting accuracy as a critical challenge for brands.
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- Shopify Stock Fluctuations: Shopify's stock has dropped 40% since last October, currently valued at $154 billion; despite pressures from slowing sales growth and rising interest rates, its Q1 revenue growth rate of 34% highlights its significance in the future of e-commerce.
- Nice's Customer Service Technology: Nice Ltd, with a market cap of $5.4 billion, derives only 14% of its cloud revenue from AI, yet its Q1 recurring revenue grew 66% year-over-year, showcasing its strong performance and growth potential in the customer service market.
- Viking Therapeutics' Drug Development: Viking Therapeutics is conducting phase 3 trials for its GLP-1 weight-loss drug VK2735, currently valued at $3.8 billion; analysts unanimously rate its stock as a strong buy with a target price of $95.40, reflecting confidence in its market potential.
- Investor Focus on Emerging Stocks: Despite overall market volatility, investor interest in Shopify, Nice, and Viking indicates optimism towards these growth stocks, particularly in the long-term growth prospects within the e-commerce and health sectors.
See More
Analysis of Shopify's Stock Price Decline
- Shopify's Stock Decline: Shopify's shares have fallen 40% since October, driven by slowing sales growth, rising interest rates, and potential threats from AI, although these concerns may be overstated.
- Nice Ltd's Customer Service Edge: Nice Ltd's platform facilitates over 20 billion interactions annually, and while AI accounts for only 14% of its cloud revenue, its annualized revenue has reached $345 million, indicating strong growth potential.
- Viking Therapeutics' Market Potential: Viking Therapeutics' VK2735 is in phase 3 trials and could disrupt the $200 billion obesity drug market, with analysts setting a target price of $95.40, representing a 200% upside from current levels.
- Cautious Investor Sentiment: Despite stocks remaining above late-March lows, many investors are on the sidelines due to concerns about a market pullback, particularly in the current economic climate, which challenges confidence in reinvesting.
See More
AI Infrastructure Investment Soars to $725 Billion
- Surge in Investment: The top four U.S. hyperscalers, including Google, Microsoft, Meta, and Amazon, are projected to increase capital expenditures to $725 billion in 2023, a 77% rise from last year, reflecting strong demand and confidence in AI infrastructure.
- AI Chip Market Outlook: Gartner estimates that the non-memory semiconductor market will generate $687 billion in revenue, with Nvidia leading the charge as its Q1 fiscal 2027 revenue surged 85% year-over-year to $81.6 billion, showcasing its competitive edge in AI chips.
- AMD's Growth Potential: Although AMD's growth isn't as rapid as Nvidia's, contracts with OpenAI and Meta are expected to drive a 46% year-over-year revenue increase in 2023, with analysts forecasting earnings of $7.37 per share, indicating robust profitability.
- TSMC's Market Position: As the world's largest semiconductor foundry with a 72% market share, TSMC anticipates mid-to-high 50% growth in AI accelerator sales through 2029, further solidifying its leadership in the AI infrastructure market.
See More
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- Surge in Market Investment: The top four U.S. hyperscalers are projected to spend $725 billion on capital expenditures this year, a 77% increase from last year, indicating strong demand for AI data centers and driving significant revenue and earnings growth for related chip companies.
- Nvidia's Revenue Surge: Nvidia's Q1 fiscal 2027 revenue increased by 85% year-over-year to $81.6 billion, with current quarter revenue expected to reach $91 billion, reflecting a staggering 95% year-over-year growth and showcasing its competitive strength in the AI chip market.
- AMD's Steady Growth: Although AMD's growth isn't as rapid as Nvidia's, it anticipates a 46% year-over-year revenue increase in the current quarter, bolstered by significant contracts with companies like OpenAI and Meta, indicating its diversified presence in the AI chip sector is yielding results.
- TSMC's Market Dominance: As the world's largest semiconductor foundry with a 72% market share, TSMC is expected to see its AI accelerator sales revenue grow by over 50% by 2029, making it a safe investment choice for long-term growth in the AI infrastructure market.
See More
Consumer Reluctance Towards AI Shopping Decisions
- Trust Deficit: According to Gartner's survey, only 11% of U.S. consumers are willing to let AI make purchasing decisions, indicating a significant lack of trust in AI shopping tools, particularly in low-stakes categories like personal care and household supplies.
- Preference for Supportive Tools: The survey reveals that 31% of consumers are open to AI narrowing choices for household supplies, while 28% are willing to do so for personal electronics, suggesting a preference for AI that aids in product research and comparison rather than making decisions autonomously.
- Accuracy Concerns: Among consumers who used AI for shopping, 54% reported needing to verify the accuracy of the information provided by AI, and 62% felt that the information was a waste of their time, highlighting accuracy as a critical challenge for brands.
- Passive Exposure vs. Active Adoption: While 72% of consumers state that generative AI appears in their internet and app usage, this passive exposure does not equate to active adoption, indicating that brands must enhance consumer control to build trust.
See More
Intel's Stock Surges 225% Amid Strong Demand and Growth Prospects
- Stock Surge: Intel's stock has skyrocketed nearly 225% in 2026, primarily driven by improved financial performance and increased influence in the AI chip sector, reflecting market optimism about its future growth prospects.
- Profitability Boost: The company reported a 7% year-over-year revenue increase to $13.6 billion in Q1, with non-GAAP earnings per share of $0.29, significantly exceeding analysts' expectations of $0.01, indicating strong performance in its data center and AI segments that will continue to drive earnings growth.
- Strong Customer Demand: Intel's data center and AI business achieved a 22% year-over-year growth in Q1, reaching $5.1 billion, and the company is focused on increasing production capacity to meet rising market demand, particularly for server CPUs.
- Foundry Business Expansion: Intel is set to manufacture chips for Apple, with its advanced 18A process yield improving by 7% to 8% monthly, which will lower production costs and enhance profitability, further solidifying its position in the foundry market.
See More
