There’s no stopping the progress of technology.
That much is clear when you look at things like how smartphones manage to jam more tech in new models each year.
It becomes clear when you see what cars are capable of today compared with even just a decade ago.
It becomes clear when we as a society are at least somewhat seriously talking about the idea of colonizing Mars.
Not even a worldwide pandemic could do much to stop technology’s forward march. If nothing else, it probably accelerated what was already in the works.
It’s a story that’s likely to dominate the next decade as we prepare to put this pandemic behind us.
A Tale of Two Economies
Given how devastating the pandemic has been, it’s likely you know someone who lost their job. It was an all-too-real story for thousands who worked retail, food service, or in some other industry slammed by the pandemic.
While the nation continues coming to grips with those job losses, the tech sector has been thriving the entire time. You already know about how companies like Zoom became household names over the past year. Likewise, it was hard to ignore stories about how Amazon and various streaming companies saw increased user counts as everyone stayed home.
People had to adjust and tech companies were right there to fill those needs.
Profits for tech companies soared, the number of job postings in the sector climbed and eventually fed further profit growth, and the cycle continued. This all happened to the tune of a $3.4 trillion increase in value for just seven tech sector mainstays (Apple, Microsoft, Amazon, Alphabet, Facebook, Tesla, and Nvidia).
As the world shifts to an increase in work-from-home roles and the way we interact with each other, there’s no reason to think the fortunes of these companies and others like them will change.
But the big names are just the surface level of the story.
Like any industry there are smaller, lesser-known companies set to capitalize on the trend that’s affecting the entire industry. These tend to be companies that deal in the nuts and bolts of the sector rather than the end product that consumers use. Think about companies that provide things like computer servers that companies like Amazon rely on for web services.
Think about companies that work behind the scenes to deal with issues like cybercrime and network security.
Think about how the healthcare industry will change. Companies providing software that allows you to video chat your doctor from home will be needed more than ever.
Those are just a few examples, but one big one that many seem to overlook is the computer chips that make all of this technology possible.
Whether we’re talking about your smartphone, your television, your computer, or any other piece of tech you use every day, inside its microprocessors are transistors. Those transistors have been getting smaller and more numerous while computing power has grown.
Everything was great for a while because much of the country’s economic growth was tied to this trend, but the problem is that the trend has hit a wall. These microprocessors can’t get much more powerful, and that conflicts with the very idea that we’ll continue needing increases in processing power for new tech innovations.
Think about everything you’ve been hearing lately about 5G, the internet of things, and artificial intelligence. Right now, these are fairly niche sectors that don’t have widespread adoption. That’s set to change over the next few years as they become standard in pretty much everything we use.
But for that to happen, computing power needs to be able to keep up. Silicon Valley chipmakers have been scrambling to make that happen, but it doesn’t look like the solution will come from one of them. Instead, a DARPA project in its early stages is set to usher in the future of computing.
The opportunity for profit is there if you get in soon enough.
The Computer Chip Crisis
Big-name companies like Intel have been scrambling to find a way to fix the computing power problem. At the same time, the Defense Advanced Research Projects Agency (DARPA) has teamed up with a small company to overcome the issue.
That could put big-name chip manufacturers on the back foot and net big profits for this company. The global microprocessor market is expected to reach $112.7 billion by 2025, so there will be plenty of profit to be had if it pulls this feat off.
With computing only getting more complex and demanding, the company that solves this problem could be well on its way to becoming a household name over the next decade.
The details are in Jimmy Mengel’s newest report.
He explores why this is such a big deal and what investors can do to get in on a coming trend that not many people know about.
Don’t wait too long. This is a problem that’s going to become apparent to the mainstream sooner than later. If you get in now, you can benefit from the solution when the company behind it really takes off.
