https://t.co/rxhLFpfwzR [Is China’s AI Capability Real?] Anthropic’s Allegations of Claude Misuse | How Will China’s Memory Production Surge Reshape the Semiconductor Market? | Is the Midterm Election a Buying Opportunity for AI Stocks? | Stocks to Watch Ahead of 2027 [Tomohiro Okawa] Bungei Shunju PLUS Official Channel #AISummary Next Investment Themes Beyond the AI Market and the Impact of U.S.-China Competition and the Midterm Elections 🔳 Semiconductor and Memory Risks Are Rising While semiconductors and memory may still rise further, concerns have been raised that price volatility and earnings risks have increased, suggesting caution against aggressive investment at this stage. 🔳 Next Candidate: Hyperscalers Hyperscalers, which are beginning to monetize benefits from AI investment, are seen as having continued growth potential. 🔳 Focus on Software Companies Leveraging AI Investment themes are expected to expand beyond AI developers to software companies using AI to enhance services. A key advantage is the dual potential for reduced development costs and improved functionality. 🔳 Rejection of the “SaaS Obsolescence” Theory Current AI primarily serves to streamline human tasks rather than fully replace creative work that generates something from nothing, leading to skepticism toward claims that AI will eliminate SaaS or specialized professions. 🔳 AI as an Extension of Digital Transformation Current AI is viewed as a technology that efficiently researches, organizes, and documents content conceived by humans—essentially similar in nature to how spreadsheet software improved business efficiency around the year 2000. ListItemIcon It will take time for AI to widely replace human creative work, and user AI literacy will also be necessary. Skepticism was expressed toward predictions that jobs will vanish dramatically within two to three years. ListItemIcon PCs and Smartphones Will Also Benefit If semiconductor and memory prices fall in the future, PC and smartphone manufacturers that use large volumes of these components could benefit from lower production costs. ListItemIcon Focus on Apple’s Profitability Apple is seen as avoiding the massive data center investment race typical of hyperscalers, instead opting to leverage external AI infrastructure. Its strong customer base willing to pay premium prices was cited as a key strength. ListItemIcon Growing Corporate Demand for Local AI An increasing number of companies want to run AI internally without sending sensitive data to external clouds, driving demand for local environments using PCs and small computers. ListItemIcon Attention on Dell, HP, and Others If corporate adoption of local AI environments expands, PC manufacturers such as Dell, HP, and Lenovo could benefit from increased demand. ListItemIcon Look for Companies That Will Benefit from Falling Semiconductor Prices One investment strategy is to identify companies currently struggling due to high semiconductor and memory prices, aiming to profit from future earnings improvements when prices decline. ListItemIcon Gaming Industry Also a Potential Beneficiary Game console manufacturers use large amounts of semiconductors and memory; lower component prices would improve costs. Increased hardware sales could also boost game software sales, making the broader gaming sector a candidate for investment. ListItemIcon Automotive Sector as a Short-Term Recovery Candidate Due to heavy semiconductor usage in autonomous driving and Software-Defined Vehicles (SDVs), falling semiconductor prices would benefit automakers. Considering the weak yen, Japanese auto stocks may have near-term recovery potential. ListItemIcon Long-Term Competition in Automotive Is Tough While Tesla and Chinese firms lead in SDVs, and Japanese and European manufacturers are also advancing development, long-term competitiveness will hinge on rivalry with U.S. and Chinese companies. ListItemIcon AI Benefits Extend Across Diverse Industries Investment themes are expanding beyond data centers to include software, PCs, smartphones, gaming, automotive, energy, heavy industry, and other sectors benefiting from AI’s ripple effects. ListItemIcon Attention on Allegations Against Chinese AI Anthropic has alleged that Chinese AI companies may have used Claude’s outputs or leveraged them for training. However, the discussion noted these remain unconfirmed claims at this stage. ListItemIcon Views on the Technology Gap Between U.S. and Chinese AI If some Chinese AI systems are heavily reliant on Claude, the technological gap between U.S. and Chinese AI software may be larger than previously assumed. ListItemIcon China’s Presence in Memory Markets In contrast to software, Chinese hardware and memory companies are viewed as a threat. Increased production capacity by DRAM and NAND manufacturers could lead to future memory price declines. ListItemIcon U.S.-Led AI Development Will Continue Although there is ambiguity surrounding efforts to slow AI development, the overall momentum of AI investment and innovation remains unchanged, with continued advancement expected to center on the U.S. for the foreseeable future. ListItemIcon Midterm Elections as a Market Volatility Factor The U.S. midterm elections are seen as potentially causing greater market turbulence than usual, with uncertainties including inflation fears from fiscal stimulus and political debates over AI data centers. ListItemIcon Backlash Against Data Centers Is a RiskRising electricity costs due to increased data center demand and employment impacts from AI could become political issues, potentially leading to short-term corrections in AI-related stocks. 🔳 AI’s long-term trend remains unchanged Even if AI-related stocks experience short-term declines due to political regulations or elections, the underlying trend of companies seeking to improve productivity and profitability will not stop, meaning the adoption of AI technology is expected to continue unabated. 🔳 Government composition may shift energy policy Significant changes in U.S. political dynamics regarding fossil fuels versus clean energy could influence AI investment through their impact on energy costs. 🔳 Key focus areas: software and gaming Software, gaming, and hyperscalers were highlighted as top candidates for growth from year-end through 2027, with emphasis placed on companies that can effectively integrate AI to reduce costs and enhance services. 🔳 Japanese stocks: focus on large restaurant chains with overseas expansion Large food and restaurant companies in Japan were identified as potential candidates. While domestic challenges include rising raw material costs and difficulty passing on price increases, these firms benefit from strong global demand for Japanese cuisine, enabling easier price transmission abroad. 🔳 Companies with high overseas sales ratios have an advantage Firms actively expanding overseas, such as conveyor belt sushi chains, are seen as better positioned to grow while reducing dependence on domestic inflation and consumption trends. 🔳 Condiment companies also have room for overseas growth Food companies tied to Japanese cuisine—such as soy sauce and mirin manufacturers—are expected to benefit from growing global demand for Japanese food. Their business models are easy to understand and offer defensive characteristics, making them attractive to individual investors.