Analyst Dan Ives predicts a strong tech earnings season

Earnings season is almost upon us, and Wedbush Securities analyst Dan Ives thinks it’s going to be a good one for the tech industry.

“You have enterprise spending that looks pretty healthy and consumer [spending] that’s ramping,” Ives told IT Brew. “I think that’s a one-two punch; that’s pretty bullish.”

Here’s what Ives had to tell us about the tech landscape, AI, and consumer sentiment.

This interview has been edited and condensed for clarity.

You’ve been a big booster of AI and its place in the tech industry. How do you see this sector affecting earnings this quarter?

It’s the start of a fourth Industrial Revolution. Earnings season is so important to gauge what the consumer and enterprise spending environment looks like. The Street needs to see smoke signs that are positive to keep the rally going.

On the enterprise, what we’re seeing now is the first wave of AI spending play out, from Nvidia to Microsoft to [semiconductors] to software. But on the consumer side, we’re not going to see full AI use cases till 2025. And that’s really dependent on Apple fully embracing AI, Meta, as well as Google.

What about small and medium businesses (SMB)—do you see them starting to invest more in AI this year?

SMB is going to make up a big piece of overall AI spending over the next decade. It’s starting with large enterprises, but SMBs need to fully adopt the AI revolution over the coming years for this to be fully realized in terms of the potential. So I think the first wave is large enterprises. And that’s starting to happen, but SMB is a key swing factor in terms of overall growth.

Wedbush recently published a consumer survey. Can you tell us about it?

Yeah, we reached out to 1,000+ US consumers. And—we’ve done surveys like this many times—I view them as good barometers, directionally. Significantly more respondents planned to increase spending across categories this year than those who planned to spend less, and I think that’s important.