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Ted and Logan’s Top Ten A.I. Competitors

August 18, 2025

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The Magnificent Seven – Alphabet, Amazon, Apple, Microsoft, Meta, Nvidia, and Tesla – used to compete in distinct lanes. AI has changed that. These 7 are now in a new pool without lanes and with more competitors: OpenAI, Oracle, AMD, IBM, Palantir, IBM, Anthropic, Salesforce.

Over the history of capitalism, no other new technology has attracted as much aggregate investment as AI.

Alphabet, Microsoft, Amazon and Meta alone are set to spend $400 billion on capex in 2025 - most of it on AI.

The competition is intensifying, and investors are looking more critically at (i) total AI investments by each firm, (ii) the vision, (iii) use cases, (iv) the human capital, and (v) returns on early investments.

We have a basic question: Can all of the Mag 7 and others succeed in AI?

Our answer is No. What we said in Webinar no. 1 in April matches recent analysis n the business press: the leading edge will not accommodate that many winners.

So, which companies are doing well in the earlier stages of the AI race?

Let’s start with our Top Four:

  1. Microsoft: Its Windows and Office franchises give it a massive product portfolio and existing customer base to whom it can market its AI products. Plus, Azure is closing the gap with Amazon AWS in cloud computing.

  2. Amazon has shown strong financial performance over the last year and has invested heavily in AI. While its last quarter results disappointed investors, its pipeline from AI investment to revenue is shorter than for many competitors.

  3. Alphabet’s huge investments in AI are showing early returns. So, we’re inclined to dismiss its relatively poor stock performance in the last three quarters. Also, Alphabet’s long-standing commitment to research and well-funded research groups such as DeepMind have generated significant breakthroughs in AI.

  4. NVIDIA: Its chips are indispensable in training all AI models – and no competitor has chips to match. More important, NVIDIA is building an infrastructure for customers that includes software, expert assistance, and chips.

Here are the Next Six:

  1. Apple has struggled to incorporate AI into its products. But its massive hard-to-exit ecosystem gives it an enviable edge.

  2. Tesla: Musk wants to incorporate AI into the physical world, such as AI-powered robots and autonomous vehicles. We don’t doubt that Musk can pull it off, but that will take time.

  3. Oracle boasts a significant customer base - including other companies from our list - whose operations are powered by Oracle’s systems. Switching away from which has proved virtually impossible. Their focus on AI agents looks good so far.

  4. AMD has, of course, eclipsed Intel. AMD is now the closest company to NVIDIA in making hardware needed to power the AI race. Its stock has outperformed Mag Seven last year, and so AMD’s AI ambitions are only growing.

  5. OpenAI with ChatGPT enjoyed the first-mover advantage to help it raise round after round of new capital. Its $12 billion in annualized revenue from ChatGPT subscriptions is no mean feat in the venture world, but stiff competition in like models and its non-orthodox legal status may limit revenue opportunities going forward.

  6. Meta: Zuckerberg can’t hire the people the company needs to become credible - despite gigantic pay packages. Given the lack of a business customer base, what is Meta’s AI strategy? We doubt it will be found in the metaverse.

Honorable Mentions:

  1. IBM has already automated some coding jobs using AI - and might be the most advanced in its work on quantum computing.

  2. Palantir has just reported its first $1 billion in quarterly earnings. Its business model is well-suited for revenue-generating AI-powered features, but the company’s involvement in government surveillance and with the military may pose a social license hurdle down the line.

  3. Anthropic has deftly resisted eye-watering poaching by Meta, but is not nearly as recognizable as its main competitor OpenAI - and only a fraction of its revenues.

  4. Salesforce recently spent $8 billion to buy Informatica in a race to incorporate AI into the customer management sphere.

  5. X has scored notable wins – the recent iteration of its leading AI model, Grok, has compared favorably against rivals – but the company’s future is as uncertain as the actions of its owner Elon Musk.

What to look for going forward:

  • How AI rivals will leverage existing customers?

  • Will they develop products that match use cases?

  • Will they attract the human capital that is essential to success?

Check out selected business news and articles related to the Webinars and high-tech industries.
 

AI Wars:

Meta offering $100 million pay packages to top AI researchers (June 22, 2025)

"Meta’s struggles to develop cutting-edge artificial-intelligence technology" 
Mark Zuckerberg personally recruits top names in AI and "has offered $100 million packages to some people.". "He has tried to recruit OpenAI co-founder John Schulman and Bill Peebles, the co-creator of OpenAI’s Sora video generator [...] Neither of them have joined."

Meta poached three OpenAI researchers (June 25, 2025)

Lucas Beyer, Alexander Kolesnikov and Xiaohua Zhai, who were all working in OpenAI’s Zurich office, moved to Facebook.
"Meta plans to spend up to $65 billion on capital expenditures this year" (!) 
"Some AI researchers have turned down the Meta CEO, and in several cases, OpenAI has counter offered, giving its researchers more money and scope to stay."

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