Dan Ives is pushing back on the market's biggest AI anxiety. As tech earnings kick off, the Wedbush analyst says this isn't a 1999-style excess cycle - it's mid-1996, when spending accelerates, doubts linger, and the biggest gains are still ahead. His message is clear: upcoming results should validate a massive AI buildout that the Street continues to underestimate in both scale and duration.

Why Earnings Matter More Than Valuations Right Now

Ives expects a strong fourth-quarter earnings season led by Big Tech, backed by field checks showing robust enterprise AI demand at Microsoft (MSFT  ), Alphabet (GOOG  ) (GOOGL  ), and Amazon (AMZN  ). More importantly, he believes investors are still underappreciating what comes next - an estimated $3 trillion in AI spending over the next three years, with more than $550 billion in capex already in motion.

That framing matters because AI is moving beyond infrastructure. As deployments mature, the opportunity shifts toward platforms that monetize usage, workloads, and execution, not just chip sales.

3 AI Stocks Levered To The Next Phase

Snowflake

Snowflake Inc (SNOW  ) is the quintessential AI consumption proxy - customers pay for data processed, not seats. As AI workloads increase, so does consumption revenue. "Enterprise consumption phase is ahead of us into 2026," says Ives.

Snowflake currently trades at an enterprise value well below long-term growth comps (~EV/NTM Revenue ~10-11x vs peers at 15x+), implying the market still treats it like a post-hype laggard. With usage increasing across AI projects, Snowflake's model stands to benefit disproportionately as enterprises scale AI workloads.

MongoDB

MongoDB Inc. (MDB  ) has emerged as a go-to database for modern AI applications, especially those needing real-time, flexible data structures for LLMs and analytics. Ives sees the "launch of LLM models across the board."

Wall Street analysts see 40%+ long-term revenue growth, driven by expanding ARR and higher attach rates of cloud services. Its Atlas platform - a cloud subscription engine - already represents the majority of revenue and is growing faster than legacy segments, reflecting deepening adoption.

Palantir

Palantir Technologies Inc (PLTR  ) is one of the few pure plays turning AI into operational decisions for enterprise and government clients. With recent multi-year contracts in defense and health care - some exceeding $100 million annually - Palantir's AI-driven platform is moving from proof-of-concept to mission-critical.

The company has already guided to stronger cash flow and margin expansion, a rare combination in the AI ecosystem. And as Ives says, "true adoption of generative AI will be a major catalyst for the software sector."

Why It Matters For Investors

If Ives is right and this is 1996, not 1999, the risk isn't chasing what already worked - it's overlooking the ecosystem as AI spending shifts from buildout to consumption.

Snowflake, MongoDB, and Palantir aren't about the first inning of AI hype, but the next innings of adoption - where earnings, not narratives, do the talking.