Tech execs didn't just start talking about AI -- but they are talking about it a lot more

Mentioned: AVGO GOOG GOOGL NVDA

By Emily Bary

Mentions of artificial intelligence in earnings calls are up 75% so far this year, even as the number of companies referencing the technology has barely budged, MarketWatch analysis finds

Do you feel like you've been hearing a lot more about artificial intelligence in 2023? A MarketWatch analysis shows you probably have, though mentions of the technology are coming from roughly the same number of sources.

The number of AI mentions on corporate earnings calls spiked more than 75% so far this year relative to the same period in 2022, according to a MarketWatch analysis of AlphaSense/Sentieo transcript data for companies worth at least $5 billion.

The topic of AI has come up on roughly 280 of those calls in 2023, comparable to what was seen in the same period a year ago. But executives are getting more breathless in their discussions, with 1,770 mentions of AI or artificial intelligence so far this year, up from 1,006 last year. Those counts also include references from analysts who ask questions about AI.

Looking at a broader swath of companies that includes smaller ones, February 2023 saw a record number of earnings calls that discussed artificial intelligence, though that growth still didn't come close to the increase in the number of mentions. There were 488 transcripts mentioning AI in February, besting the 440 from November 2021 by nearly 11%.

Previously: Tech execs can't stop talking about AI after success of ChatGPT

The AI discussion continues to get more global, according to Nick Mazing, the research director at AlphaSense/Sentieo. Additionally, it's spanning more industries, as marketers, real-estate companies and medical businesses find new applications.

Tempting as it may be to inform investors of involvement with a hot trend, companies have been warned to tread carefully with their AI mentions. A Federal Trade Commission lawyer cautioned recently that companies wouldn't be able to get away with "baseless claims" of "AI-enabled" products.

For more:Watch your 'AI hype,' feds warn tech companies

The AI mania arrived in the wake of OpenAI's public launch of ChatGPT, a generative-AI chatbot that showed more people what could be done with artificial intelligence. Stocks that can claim a strong commitment to AI have been rewarded amid the buzz: C3.ai Inc. (AI) has gained more than 150% so far this year, and BigBear.ai Inc. (BBAI) has increased more than 385%.

AI has also come up often on tech earnings calls from much bigger names so far this year. Executives from Google parent Alphabet Inc. (GOOGL)(GOOGL), Broadcom Inc. (AVGO) and Nvidia Corp. (NVDA) were among the chattiest.

The topic of AI came up 62 times on Alphabet's early February earnings call, more than double the count from the corresponding call a year before, as the Google parent company looked to assure investors of its AI prowess after rival Microsoft Corp. (MSFT) invested in OpenAI and integrated its services.

See more: Microsoft still has 'a mountain to climb' despite AI and ChatGPT efforts

"AI is the most profound technology we are working on today," Alphabet Chief Executive Sundar Pichai said early on in the call, according to a transcript provided by AlphaSense/Sentieo. "Our talented researchers, infrastructure and technology make us extremely well positioned as AI reaches an inflection point."

Executives and analysts mentioned AI 88 times on Nvidia's late-February earnings call, up from a still-sizable 69 times on the corresponding call in 2022.

Chief Financial Officer Colette Kress also called out an "inflection point" for AI.

"Generative-AI applications will help almost every industry do more faster," she said.

Read: Nvidia adds to AI hype with new cloud-based service, stock jumps on forecast

There was also a big pickup in AI discussion on Broadcom's latest earnings call, with participants bringing up the topic 47 times, compared with just seven times in all of the earnings calls the company held in 2022, according to AlphaSense/Sentieo data.

"We're doing $200 million as far as we could estimate of silicon, Ethernet switches and fabric that goes into those AI networks as far as we could identify in hyperscalers," Broadcom Chief Executive Hock Tan said on the company's early March call.

See more:Broadcom stock moves higher after earnings, forecast beat

On Hewlett Packard Enterprise Co.'s (HPE) most recent call, AI garnered 34 mentions, versus only four on the call a year earlier.

"The traction of our portfolio is the result of our winning strategy, aligned to major market trends around the edge, cloud and AI," Chief Executive Antonio Neri said.

AI came up five times on Box Inc.'s (BOX) call in early March. Prior to that, neither executives nor analysts had mentioned AI on an earnings call since a single reference in May 2020.

"The recent breakthroughs in AI and large language models enable a new universe of use cases that we can also solve for customers," Chief Executive Aaron Levie said, noting that the company is using the technology to help customers "generate more value from their content."

Box CEO in MarketWatch interview:"We are in the era of AI-first enterprise companies to save time and improve productivity"

There were also plenty of mentions by companies outside the technology industry, like from Range Resources Corp. (RRC), a natural-gas company.

"This past year, Range pilot-tested the use of artificial intelligence in our production operations," Chief Operating Officer Dennis Degner said. "Working in conjunction with our AI technology provider, an algorithm was created to monitor well production and make automated changes to perimeters within our flow logic that enhance production and reduce downtime."

Those were the first mentions of AI on a Range call since a lone reference in 2017.

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A Dine Brands Global Inc. (DIN) executive referenced an AI call-center application back in 2021, in what was then the only mention of the technology on one of the Applebee's parent company's earnings calls until this March, when Chief Executive John Peyton discussed a use case related to loyalty members.

"We're adding artificial intelligence and predictive analytics to help recommend to them what their next purchase should be," he said.

Michael Manelis, the chief operating officer of apartment manager Equity Residential (EQR), managed to sneak in a tangential AI reference in discussing the slower recovery of the Seattle and San Francisco markets.

"Both of these cities remain hubs of the tech industry and share an entrepreneurial spirit that will continue to incubate the next big idea, be it AI or other innovations we find changing our lives a decade from now," he said on the latest earnings call.

Equity Residential was chattier about AI on past calls, with executives mentioning in previous years that the company employs artificial intelligence in communications with prospective customers.

For more:These 20 AI stocks are expected by analysts to rise up to 85% over the next year

-Emily Bary