Jensen Huang Scores Big in Japan -- Here's How to Follow the Nvidia CEO's Lead as the Country Transforms Into a $124 Billion AI Hub
Key Points
Japan is purchasing 27,500 Rubin processors from Nvidia to build an AI computing hub.
By 2032, the Japanese AI market is forecast to be valued at more than $123 billion.
Four Japanese robotics and automation companies are in the top 10 holdings of the Global X Robotics and Artificial Intelligence ETF.
Nvidia CEO Jensen Huang recently scored a big win in Japan: His company will help that country fulfill its desire to build its own artificial intelligence (AI) infrastructure.
It was announced this past week that Japan will purchase 27,500 Nvidia chips for a computing hub that is expected to launch in 2028. The AI infrastructure will support the development of blending AI with robotics, enabling machines to interact with the world around them.
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"Japan cannot outsource its national intelligence," the Nvidia CEO said during an event in Tokyo. "Japan must own, improve, secure, and deploy Japan AI."
For retail investors interested in potentially benefiting from the opportunities in what could be the next wave of AI in Japan, the Global X Robotics and Artificial Intelligence ETF (NASDAQ: BOTZ) stands out.
Nvidia CEO Jensen Huang. Image source: Nvidia.
Japan's AI sector is taking shape
It's relatively small now, but Fortune Business Insights forecasts that the size of Japan's AI market will grow from $15.6 billion in 2025 to $123.9 billion by 2032. And while investing in international companies directly can be logistically difficult for U.S. investors, BOTZ holds stakes in several Japanese companies.
The largest holding within the entire ETF is Japanese company Keyence, which accounts for 9.6% of its net assets. Keyence manufactures sensors and machine vision systems, among other products, for automation. Its products can identify objects and recognize defects, helping assembly lines operate quickly and efficiently.
There are three other Japanese companies within the Global X Robotics and Artificial Intelligence ETF's top 10 holdings. Fanuc focuses on industrial automation and robotics, and has had more than 1 million of its robots installed worldwide. SMC and Daifuku are both involved in automation and robotics.
Positioned for long-term gains
Compared to other AI-related ETFs, such as the Global X Artificial Intelligence and Technology ETF (NASDAQ: AIQ), BOTZ's performance has been mediocre. As of this writing, AIQ is up 35% over the last 12 months, while BOTZ is up just a little bit more than 9%.
If the next stage of AI does heavily involve blending it with robotics, however, and if Japan invests intensively enough to become an AI leader, BOTZ could become an outperformer in the years ahead.
Jack Delaney has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Nvidia. The Motley Fool recommends Fanuc. The Motley Fool has a disclosure policy.