Topics discussed by CEOs in Q3 2023: Sustainability, AI chips, and generative AI
In summary, the most recent “What CEOs talked about” study states that three themes were particularly prevalent in Q3 2023 earnings calls:
1) AI chips;
2) AI and most of its application areas; and
3) sustainability.
As the preferred AI keyword, ChatGPT is becoming less popular, and concerns and uncertainties about the economy seem to be decreasing.
Economic concerns continued to be a hot subject in boardroom conversations throughout the world in Q3 2023, albeit they were declining on a quarter-over-quarter (QoQ) basis. Inflation was mentioned in 47% of calls, down 5% on a quarterly basis. Concerns about the supply chain had the lowest decline, down 2% QoQ, while the recession saw the biggest decline, down 38% QoQ, and is currently mentioned in 11% of earnings calls.
Leading trends emerging in Q3
1. AI
The topic of AI as a whole increased rather sharply to 29% (+37% QoQ) in Q3 2023, while the prominence of its subfield, generative AI, continued to rise to 10% (+56% QoQ). CEOs seemed to be keeping chatGPT — which decreased this quarter — and AI and many of its related subjects apart during their QoQ earnings calls (as discussed below in “Declining themes”).
The results of our investigation also indicate a substantial increase in the terms “AI strategy” and “AI infrastructure,” with increases of 128% and 103% QoQ, respectively.
In the first quarter of this year, ChatGPTwas the hot new (AI) topic for CEOs. In Q2, generative AI shared the stage with ChatGPT as AI proponents discussed other generative LLMs. Now, in Q3, ChatGPT is no longer the hot topic, but rather, generative AI, AI strategy, AI infrastructure, and AI Chips — with companies realizing that ChatGPT is just one tool of many in the new AI portfolio. However, AI is an evolving topic, and OpenAI continues to conduct research and development into ChatGPT, so there is no reason to suspect ChatGPT will completely fade from discussions in the near term.
AI use cases like coding and chatbots are also starting to climb, but they have not yet reached the same level as the aforementioned topics. These use cases will likely roll out in the next 6–12 months, so we assess these (and other) topics to grow in Q4 and into 2024.
Of the AI umbrella (not counting AI chips, which we dive into more below), generative AI was the most talked about by CEOs. LLMs, AI infrastructure, and AI strategy saw significant rises in discussions, though they only appear within 1%–2% of the earnings reports overall.
The technology and communication services sectors lead most AI and AI subfield discussions. 67.6% of technology sector earnings calls mentioned the general topic of AI, while 50.8% of the communications services sector earnings calls discussed it. Generative AI was also fairly high for both sectors, with it mentioned in 33.9% of technology sector earnings calls and 24.2% in communications services sector calls. Of note, the industrial sector showed the third highest interest in generative AI, with 6% of their earnings calls mentioning the topic.
Coinciding with the topic of AI and subfields is a rise in AI strategy and infrastructure discussions. Though hovering between 0.5% and 1% of earnings calls, they rose 128% and 103%, respectively. This could be a sign that as companies look to AI to increase productivity and assess future investments, they are also considering AI implementation strategies.
AI CHIPS
In Q3 2023 earnings calls, GPUs were mentioned far more frequently than CPUs; the former increased 102% QoQ to 2.8% and the latter 47% QoQ to 1.7%. In relation to AI chips, Nvidia, a manufacturer of GPU chips, is rising 146% in mentions to 1.9% in line with this trend, whereas Intel is only rising to 1.2% (+48% QoQ) and AMD to 0.8% (+11% QoQ).
Also coinciding with the rise in AI discussions are GPUs, most noteworthy Nvidia, the leading GPU vendor in the market. While general discussions of GPUs rose approximately 102% QoQ to 2.8% of earnings calls, Nvidia rose 146% QoQ to 1.9%. On the chipset front, CPUs only saw a 47% climb QoQ to 1.7% of earnings calls. Meanwhile, on the vendor front, Intel saw a decent climb in discussions (~48% QoQ), and AMD a subtle climb (~10% QoQ).
GPUs are becoming the core of choice for AI applications largely due to their architectural advantages over CPUs. While CPUs are optimized for task switching and fast sequential execution with only a few, large cores, GPUs often have many more, smaller cores designed for parallel processing. Deep learning involves performing many mathematical operations, including floating-point arithmetic (often used in rendering graphics) simultaneously, making GPUs a natural fit.
GPUs also offer better cost efficiency for scaling. Though more expensive than CPUs, the time savings they offer for training large language models can more than compensate for that cost. Given that the race is on for AI market dominance, time can actually be money in this case.
Renewable energy, energy transformation, and sustainability
Mentions of sustainability, energy transition,and renewable energy slightly rebounded to 21.4% (+9.2% QoQ), 5.3% (+15.4% QoQ), and 5.2% (+10.9% QoQ), respectively. These topics are lower than their peaks in Q1 2022; however, since Q3 2022, each topic has remained generally consistent in its percentage of earnings call mentions.
Since their peaks in Q1 2022, the rate of discussions of sustainability, emissions, energy transition, and renewable energy in earnings calls have remained generally consistent each quarter, with each topic generally ticking up and down QoQ. This consistency signals a continued awareness of climate impact considerations in the sectors without it being a growing discussion topic in general.
That said, our analysis showed a general trend of CEOs emphasizing real-world projects for energy transition and renewable energy. It is worth highlighting that this emphasis comes amid a year (even quarter) of record temperatures. The US National Oceanic and Atmospheric Administration (NOAA) found that July 2023 had the warmest monthly sea surface temperature of any month and declared August 2023 the warmest August since NOAA started keeping global climate records 174 years ago.
Basic materials, utilities sectors and EMEA companies lead discussions on sustainability
The basic materials and utilities sectors led the discussions on sustainability — 45.7% and 40.9% of their respective earnings calls — with utilities taking the general lead in discussions of emissions, climate, batteries, and renewable energy (including solar power). Of note, the energy sector had the second-highest mentions of emissions (39.3%) and the fourth-highest mentions of sustainability (30.8%).
By region, our analysis showed that European, Middle Eastern, and African (EMEA) companies talked about sustainability the most in Q3 2023, with mentions rising approximately 17% QoQ to 38.5%. Meanwhile, Asia-Pacific (APAC) companies continued to increase their number of mentions over North American companies — the former reaching 28.1% in Q3 2023 while the latter remained stagnant around 17%.
