BlackRock, the world’s largest asset manager, anticipates significant growth in various sectors driven by the ongoing advancements in artificial intelligence (AI). According to Jay Jacobs, the firm’s U.S. head of thematic and active ETFs, infrastructure and cybersecurity are expected to shine particularly in 2025.
Jacobs emphasized the potential of the AI boom, noting that ‘it’s still very early in the AI adoption cycle.’ He explained that as companies continue to integrate AI, they will need to expand their data centers. Furthermore, Jacobs stated, ‘If you think about your data, you want to spend more on cybersecurity as it gets more valuable.’ This perspective positions cybersecurity as not just essential, but also as a promising area for investment in the coming year.
In his recent discussion on CNBC’s “ETF Edge,” Jacobs highlighted that the growth of AI technology will result in rapid revenues for the cybersecurity software community. He noted, ‘We think this is really going to benefit the cybersecurity [and the] software community which is seeing very rapid revenue growth.’
Delving deeper into the implications for investors, Jacobs stressed the importance of acknowledging the physical infrastructure underpinning AI technology. He explained, ‘There’s real physical things on the ground that run that technology, whether it’s power, whether it’s data centers and real estate, whether it’s chips.’ He added that the investment landscape is broadening, stating, ‘It’s not just about megacap tech names. There’s other semiconductor companies, there’s other data center companies, there’s other software companies that are benefiting from the rise of this theme.’
Jacobs pointed to several specific investment vehicles that may benefit from these trends, including BlackRock’s iShares Future AI & Tech ETF (ARTY) and the iShares AI Innovation and Tech Active ETF (BAI). As of now, the iShares Future AI & Tech ETF has reported a return of approximately 13% for the year, while the iShares AI Innovation and Tech Active ETF has seen similar growth since its launch on October 21.
In conclusion, as the landscape of AI and cybersecurity continues to evolve, Jacobs’ insights suggest that investors might find lucrative opportunities in sectors that are critical for the future infrastructure and security of technology.
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