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IBM, H2O.ai Tie-Up to Help Users Tap AI for Competitive Edge


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International Business Machines Corporation IBM recently entered into a strategic partnership with H2O.ai at H2O World 2018. Per the multi-year deal, IBM Power Systems will be combined with H2O Driverless AI to deliver Artificial Intelligence (AI) related demands of businesses. Per the press release, customers pertaining to manufacturing, healthcare, retail, Internet of Things (IoT) and financial services are well poised to benefit from the deal.

IBM POWER9 processor-based Power Systems is designed exclusively for compute-intensive AI workloads. When IBM Power Systems will be combined with the automated machine learning (ML) capabilities of H2O Driverless AI, the solution is likely to accelerate business insights up to 5X. The customers will benefit significantly from this efficiency level, which will ultimately expedite their business transformation journey.

Increasingly, enterprises are striving to digitally transform their business methods by leveraging AI. This shift calls for an innovative AI-infrastructure, which dynamically keeps customers abreast with the digital trends. The tech stalwarts are leaving no stone unturned to constantly enhance their solutions, which accelerate AI. Consequently, combining ML tools into their AI platform drives innovation.

Additionally, the respective clients can avail of IBM's Power AI on-ramp deep learning toolkit with H2O Driverless AI capabilities. Moreover, H2O open source libraries have been integrated into IBM's Data Science Experience analytics solution. Customers will be able to access the open source H2O Python modules, H2O Flow and R Modules from within the Data Science Experience solution. As a result, customers will benefit from greater flexibility and a wider choice.

Notably, H2O.ai is quite popular amongst enterprise customers. The company was recognized as a "leader" in the domain of 2018 Gartner Machine Learning and Data Science Platforms.

H2O Driverless delivers customers a data science platform featuring automation and computing capabilities. The rich characteristics of the platform comprise automatic feature engineering, ML interpretability, time-series and an automated pipeline generation to mention a few. The platform attends various requirements of use cases pertaining to every enterprise across each industry.

IBM Power Systems to Help Companies Gain Traction in AI

IBM's new POWER9-based AC922 Power Systems are claimed to be the first to support PCI-Express 4.0, NVIDIA NVDA NVLink and OpenCAPI. The combined solution is estimated to propel time-series workloads by up to 9.5x faster speed compared with the existing PCI-E 3.0 based x86 systems.

We believe, IBM POWER9 coupled with NVIDIA powered GPUs holds promise in efficiently handling cognitive/AI workloads.

The company is exploring the length and breadth of intertwined AI layers by providing solutions pertaining to digitally transforming businesses. IBM's new efficient solutions will enhance its analytics portfolio. The company is well poised to benefit from its growing presence in the AI market on a growing clientele strength clientele.

What Investors Need to Know

Tech companies are ramping up their AI portfolios to meet emerging demands. The basic needs can only be met when the companies enhance their software systems to incorporate modern ML capabilities. This in turn helps them make AI more accessible to their clientele.

In fact, per Gartner data, 40% of new enterprise applications deployed by service providers will comprise AI technologies, by 2021.

Moreover per a Forbes article, ML patents witnessed a CAGR of 34% between 2013 and 2017, making it the most rapidly growing category among all patents granted. The article also reveals that per IDC, spending on AI and ML is expected to grow to $57.6B by 2021 from $12B in 2017.

We perceive that boosting the ML tools is important for an AI-driven future in tech sector and hence, the partnership with H2O.ai will be a tailwind for IBM for years to come. The enterprise AI offerings of IBM are likely to gain substantially from this deal.

Zacks Rank and Stocks to Consider

IBM carries a Zacks Rank #3 (Hold).Some better-ranked stocks are Twitter TWTR and Upland Software, Inc UPLD , both sporting a Zacks Rank #1 (Strong Buy). You can see the complete list of today's Zacks #1 Rank stocks here.


Long-term earnings growth rate for Twitter and Upland Software is currently pegged at 23.1% and 20%, respectively.

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.



This article appears in: Investing , Business , Stocks
Referenced Symbols: IBM , UPLD , TWTR , NVDA


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