MW Here's the most unappreciated AI beneficiary right now, according to Ark Invest's Cathie Wood

By Barbara Kollmeyer

ARK chief upbeat over tech under Trump administration

U.S. technology is set to "do very well" under the administration of President Trump, and one sector in particular, said Ark Invest Chief Executive Cathie Wood.

"I do believe the U.S. was at risk of losing innovation. Certainly, under the last SEC Chairman [Gary] Gensler, we almost lost the digital assets revolution to other countries. Now it's coming back," Wood told Bloomberg in a series of interviews on Monday, adding that what's emerging from tariff negotiations "is a tax cut, certainly for the U.S."

"I think under this regime, technology in the U.S. will do very well," she said, pointing specifically to "technologically-enabled innovation" that she views as "highly undervalued."

"We believe the market in the U.S. is going to broaden out and reward some of the companies that have lagged behind badly," said Wood, adding that Ark Invest is actively looking for more "innovative companies" around the world.

And she said they are most enthusiastic on healthcare, on the view AI will dramatically cut drug discovery and development costs.

"We think the number of years it will take to discover and then launch a new drug will shrink from 13 years to eight years. We think that we're going to have molecular diagnostic tests to diagnose disease much earlier. We're going to move from sick-care spending, which in U.S., is 85% of healthcare spending, more toward therapies that actually cure," she said.

Biotech Crispr Therapeutics $(CRSP)$ and synthetic biology group Twist Biosciences $(TWST)$ are two that she likes in the space.

"I think healthcare is the most underappreciated beneficiary of AI out there, but you have to make sure pharma holdings are harnessing these tools," aggressively, she said, or they will find newer companies hot on their heels.

"Robotics, energy storage, AI, blockchain technology and multiomic sequencing in the life science space are going to be the big drivers in the years ahead," she said.

Wood said tech will also get boosted because of "collapsing" innovation costs for AI training and inference when models draw conclusions based on new information.

The money manager admitted that ARK portfolios have faced "tremendous headwinds over the last four years," but have been helped more recently as stock valuations have pared back. Her flagship ARK Innovation exchange-traded fund ARKK is slightly positive for 2025, rallying 19% this quarter after an 8% return in 2024.

And while Tesla $(TSLA)$, which was reduced in the flagship fund throughout late last year, has suffered "brand damage" from chief executive Elon Musk's involvement in U.S. politics, Wood flagged a big positive for the EV maker - an expected "lock" on robotaxis in the U.S.

Read: These are the 10 fund-management firms that lost the most money in the past decade. You'll never guess No. 1.

On the economy side, Wood said she expects upside surprises for U.S. growth in the latter half of the year and downside surprises for inflation, "because technology is inherently deflationary."

-Barbara Kollmeyer

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May 19, 2025 10:42 ET (14:42 GMT)

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