E46: AI – The Apex Technology of the Information Era?
KEY TAKEAWAYS
- Citi Research outlines a structural bull case for the S&P 500, arguing that the index's increasing concentration in growth-oriented technology, powered by the AI theme, provides a strong foundation for long-term earnings growth.
- The S&P 500's composition has shifted to be more growth-oriented and less economically sensitive. This structural change, combined with AI-driven productivity gains, supports higher valuations and more resilient long-term earnings growth.
- The current AI investment wave, focused on infrastructure “providers,” is expected to broaden to a much wider application of “users,” sustaining long-term earnings growth and profitability across a larger swath of the market.
Citi Head of Research Lucy Baldwin sits down with Heath Terry, Head of Tech and Communications Research, to discuss AI as the apex technology of the Information Age. Topics discussed include the pendulum swings in investors’ views of AI, what we’re learning from AI use cases, the future of the enterprise tech stack, and the critical role of private companies.
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Lucy Baldwin, Global Head of Research, Citi
Lucy Baldwin is a Managing Director and Global Head of Research at Citi. Lucy is responsible for managing Citi’s global independent research across all asset classes. Lucy joined Citigroup in April 2021 from Credit Suisse, where she was Global Head of Equity Sales. Prior to Credit Suisse Lucy was at Bank of America as Head of European Equity Sales (2015-2019), and at Goldman Sachs as a Director of European Equity Research and in a variety of research analyst roles (2006-2015). Lucy started her career at Cazenove as an equity research analyst covering the building materials sector.
Heath Terry, Global Head of Technology and Communications Research, Citi
Heath Terry is the global sector lead for Tech & Communications Research at Citi Research. Prior to joining Citi in May 2025, Heath led the centralized research effort in TMT for Balyasny Asset Management and was a managing director at Third Point Ventures, leading its growth stage venture capital practice. Before that Heath worked for more than 20 years in equity research, most recently as the head of Goldman Sachs Global Investment Research’s Technology, Media and Telecom Group following time at Credit Suisse and Merrill Lynch. While at Goldman Sachs, Heath led the firm’s working group in research on artificial intelligence and created its venture capital research practice. He is a trustee for the Southern Environmental Law Center and vice chairman of the University of Alabama President’s Cabinet.
