Is artificial intelligence guaranteed to make employees productive? Contrary to popular belief, not quite. A recent study by AI research nonprofit METR on a group of seasoned developers has revealed how artificial intelligence doesn’t always help speed up tasks.
The research involved studying a group of seasoned developers who used Cursor, a popular AI coding assistant, to help them complete tasks in familiar open-source projects.
The developers believed that using the AI tool would help them speed up by 24%. Even after completing the tasks, they were of the view that task times decreased by 20%. However, the study found that it increased task completion time by 19% instead.
The findings conclude that artificial intelligence may not always make workers more productive.
“When we watched the videos, we found that the AIs made some suggestions about their work, and the suggestions were often directionally correct, but not exactly what’s needed”.
– Joel Becker, one of the two lead authors
Nevertheless, the majority of the participants from the study, as well as its lead authors, Joel Becker and Nate Rush, continue to use Cursor for their work. They believe that using artificial intelligence makes the development work easier, like improving an essay instead of staring at a blank page.
“Developers have goals other than completing the task as soon as possible. So they’re going with this less effortful route.”
-Becker
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10. Arm Holdings plc (NASDAQ:ARM)
Number of Hedge Fund Holders: 42
Arm Holdings plc (NASDAQ:ARM) is one of 10 Trending AI Stocks on Wall Street. On July 10, Goldman Sachs analyst James Schneider initiated coverage on the stock with a “Neutral” rating and a price target of $160.00.
Goldman Sachs is optimistic that Arm will maintain its lead in the smartphone market, as well as increase its penetration in the data center segment now that hyperscalers are increasingly deploying custom ARM-based CPUs.
Another positive factor highlighted by the firm is the anticipation that ARM will leverage the v8 to v9 transition and greater adoption of Compute Subsystems (CSS) to take advantage of increased royalty rates.
However, the firm believes that both of these factors are already understood by the investors and reflected in the stock price. As such, there is limited upside for the stock.
Arm Holdings plc (NASDAQ:ARM) is a semiconductor and software design company that designs and manufactures semiconductor technology and other related products.
9. GitLab Inc. (NASDAQ:GTLB)
Number of Hedge Fund Holders: 52
GitLab Inc. (NASDAQ:GTLB) is one of the 10 Trending AI Stocks on Wall Street. On July 10, BofA Securities analyst Koji Ikeda reiterated a “Buy” rating on the stock with a $72.00 price target.
The investment firm came out incrementally positive on GitLab’s long-term market potential following a meeting with CEO Bill Staples and CFO Brian Robins. The firm believes that the company’s “Duo strategy” is accurately positioned to gear up increased adoption of premium paid tiers and add-on AI products such as the Duo Pro, Duo Enterprise, and the Agent Platform.
Responding to concerns about code generation competitors likely leading to shrinking seats and technological disadvantages for GitLab, the firm noted that they are baseless and that code generation is “becoming a feature.” Moreover, GitLab’s end-to-end developer workflow efficiency remains differentiated.
The firm anticipates GitLab to uphold durable revenue growth exceeding 20% with expanding free cash flow margins over the medium term. It considers them to be “attractive investment traits.”
GitLab Inc. (NASDAQ:GTLB) develops software for the software development lifecycle in the US, Europe, and the Asia Pacific.