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02 Apr 2025

The AI Supercycle™ Report: Chip outperformance, measuring ROI, and AI across sectors

The AI Supercycle™ Report: Chip outperformance, measuring ROI, and AI across sectors

Key Takeaways:

  • Semiconductors Fuel AI Growth: Semiconductor stocks have outperformed the broader U.S. market by nearly 3:1 since 2023, driven by surging demand for AI infrastructure, highlighting their pivotal role in the AI supercycle.
  • Enterprises Focus on AI ROI: As AI adoption grows, organizations are prioritizing governance and infrastructure to capture tangible value, creating opportunities for companies that enable measurable AI outcomes.
  • AI Expands Across Industries: From manufacturing to marketing, AI is transforming diverse sectors, with non-traditional tech companies and creative industries leveraging AI for innovation and efficiency.

Quote of the Week:

“AI will drive growth, but only Authentic Intelligence can empower the world.”
— Matt Garman, Chief Executive Officer of Amazon Web Services, via World Economic Forum

Top 5: AI in the Headlines

AI is moving fast—so are the investment opportunities. The AI Supercycle™ Report highlights the key recent developments that AI investors interested in capturing the entire supply chain need to know. The report also include examples of companies well-positioned to capitalize on these trends, as well as the Chart of the Week.

1. Reuters: Foxconn Unveils First Large Language Model

  • Why It Matters: Foxconn, a major electronics manufacturer, has entered the AI race by launching its first large language model, signaling the growing role of non-traditional tech companies in AI development. This move highlights opportunities for investors in companies that leverage AI to enhance manufacturing and supply chain efficiency.
  • Key Quote: “Foxconn’s entry into AI underscores the potential for manufacturing firms to drive innovation in the AI space.”
  • Stock Exposure: VistaShares Artificial Intelligence Supercycle ETF (AIS) holds Foxconn Industrial Internet Co Ltd (601138 C1), a key player in smart manufacturing and AI-driven industrial solutions that is potentially positioned to benefit from Foxconn’s AI advancements.

2. Medium: The State of AI in 2025: How Organizations Are Rewiring to Capture Value

  • Why It Matters: This article highlights that, while AI adoption is at an all-time high, many organizations are still struggling to translate AI investments into tangible business value, emphasizing the need for better governance and infrastructure. For investors, this underscores the importance of AI companies that enable enterprises to rewire their processes and achieve measurable AI-driven outcomes.
  • Key Quote: “Organizations must rewire their processes, invest in talent, and establish robust AI governance to truly capture value in 2025.”
  • Stock Exposure: AIS holds Synopsys (SNPS), a company providing AI-driven design tools that help enterprises optimize AI hardware, supporting strategic AI implementation for better governance and ROI.

3. Synthesia: 8 AI Trends to Look Out For in 2025

  • Why It Matters: This report highlights AI’s impact across industries, including healthcare and manufacturing, and the growing need for regulation. For investors, this signals opportunities in AI solutions tailored for specific sectors, as well as companies addressing regulatory challenges.
  • Key Quote: “AI’s impact will extend across all industries, introducing new capabilities and combinations that will spur the emergence of novel use cases and applications.”
  • Stock Exposure: AIS holds Cadence Design Systems (CDNS), which provides AI-driven tools for semiconductor design, supporting AI applications in diverse industries like healthcare and manufacturing.

4. IDC Blog: From Metrics to Value: A CIO’s Guide to Improve Measurement of Digital Transformation

  • Why It Matters: IDC emphasizes the need for better metrics to measure AI’s impact on digital transformation, particularly in enterprise settings. This trend highlights opportunities for investors in companies that provide AI analytics and measurement tools to ensure ROI.
  • Key Quote: “Organizations need to rethink how they assess AI investments, optimize infrastructure, and navigate regulatory risks.”
  • Stock Exposure: AIS holds Arista Networks (ANET), a company providing high-speed networking solutions that support AI-driven analytics, helping enterprises measure and optimize their AI initiatives.

5. Reuters: Adobe rolls out AI agents for online marketing tools

  • Why It Matters: Adobe’s introduction of AI agents for marketing tools demonstrates the growing integration of AI into creative industries, offering new revenue streams for companies in this space. This trend points to investment opportunities in AI-driven marketing and content creation.
  • Key Quote: “Adobe’s AI agents enable marketers to automate and optimize campaigns, showcasing AI’s potential in creative industries.”

Chart of the Week: Semiconductor Stocks vs U.S. Stock Market

Closing Insights

The AI supercycle in 2025 is being propelled by the semiconductor sector’s remarkable growth, with the Morningstar Global Semiconductors Index up 117.4% since 2023, far outpacing the broader U.S. market. This underscores the foundational role of semiconductors in AI’s expansion, from powering large language models to enabling enterprise digital transformation. Meanwhile, as organizations across
manufacturing, healthcare, and marketing sectors integrate AI to drive efficiency and innovation, the focus on achieving measurable ROI highlights the importance of robust governance and infrastructure.
Investors can seize opportunities by targeting companies that support AI’s diverse applications and infrastructure needs, ensuring they capture the full potential of this transformative trend. At VistaShares, we focus on capturing the entire AI supply chain—not just the obvious winners. The VistaShares Artificial Intelligence Supercycle ETF (AIS) is designed to provide exposure to the companies driving AI infrastructure, computing power, and connectivity. As AI investment themes evolve, we
remain committed to identifying opportunities beyond the headlines, ensuring that investors are positioned for AI’s long-term supercycle.

Investors should consider the investment objectives, risks, charges and expenses carefully before investing. For a prospectus or summary prospectus with this and other information about the Fund,
please call (844) 875-2288. Read the prospectus or summary prospectus carefully before investing.

Investing involves risk, including possible loss of principal.

For the VistaShares Artificial Intelligence Supercycle ETF (AIS) top holdings & fund details, please visit: https://www.vistashares.com/etf/ais/#holding

Artificial Intelligence Risk. Issuers engaged in artificial intelligence typically have high research and capital expenditures and, as a result, their profitability can vary widely, if they are profitable at all. The
space in which they are engaged is highly competitive and issuers’ products and services may become obsolete very quickly. These companies are heavily dependent on intellectual property rights and may be adversely affected by loss or impairment of those rights.
Equity Market Risk. Common stocks are generally exposed to greater risk than other types of securities, such as preferred stock and debt obligations, because common stockholders generally have inferior
rights to receive payment from specific issuers.
Technology Sector Risks. The Fund will invest substantially in companies in the technology sector, and therefore the performance of the Fund could be negatively impacted by events affecting this sector.
Market or economic factors impacting technology companies and companies that rely heavily on technological advances could have a significant effect on the value of the Fund’s investments.
Foreign Securities Risk. Investments in securities or other instruments of non-U.S. issuers involve certain risks not involved in domestic investments and may experience more rapid and extreme changes in
value than investments in securities of U.S. companies.
Index Strategy Risk. The Fund’s strategy is linked to an Index maintained by the Index Provider that exercises complete control over the Index.
New Fund Risk. The Fund is a recently organized management investment company with no operating history. As a result, prospective investors do not have an extensive track record or history on which to
base their investment decisions.

Foreside Fund Services, LLC, distributor.