3 ASX shares using AI to help supercharge profits

Artificial intelligence could be the next trend to boost businesses.

| More on:
appen share price

Image source: Getty Images

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

Key points

  • Temple & Webster is using a variety of tools to help improve its conversion and revenue of customers
  • Volpara is using the latest AI to help analyse breast screening images and identify risk
  • Sonic has teamed up with an AI business to create a new era of pathology analysis

Artificial intelligence (AI) is disrupting a number of different services and industries. Some ASX shares are finding opportunities to boost the profit margin by using AI.

Companies that are able to grow the revenue and profit margin can grow their bottom line at a pleasingly fast rate, which can be a good thing for shareholder returns.

Businesses don't necessarily need to be classified as an ASX tech share to use AI. I'm going to tell you about three ASX shares that are looking to utilise AI to boost profit.

Temple & Webster Group Ltd (ASX: TPW)

Temple & Webster is an ASX retail share that sells all of its 200,000 products online. It has a large array of furniture and homewares on its website, as well as a growing home improvement range and products for home improvement.

The company recently gave a business update which included an AI update.

It said that ChatGPT now powers all pre-sale product enquiry live chats (which accounts for 25% of customer enquiries. This led to an "increase in live chat customer satisfaction, an increase in customers adding products to their carts, and an increase in conversion rates from this channel."

The ASX share has increased its investment in Renovai, an Israeli start-up that is disrupting how customers shop. At the moment, this powers product recommendation mood boards on the site which have shown a "significant increase in conversion rate for customers who interact with this tool."

Finally, it has used AI to generate "enhanced product descriptions across all 200,000 products on the site, a task not possible to do at scale efficiently with a human team." Company testing has shown this has led to an increase in the conversion rate, add to carts and revenue per visit.

Sonic Healthcare Ltd (ASX: SHL)

Sonic is a global pathology business, but it's involved in AI in a couple of different ways.

The ASX healthcare share has a 20% stake in AI business Harrison.ai which has an existing joint venture called Annalise.ai, which is seen as a market leader in radiology AI.

Sonic's joint venture with Harrison.ai is called Franklin.ai which aims to "develop best-in-class AI diagnostic tools for pathology. Sonic will use Franklin products in-house to "enhance efficiency and quality in its global operations."

Franklin's strategy is to sell AI solutions to the global market. The ASX share's management believes there are "powerful synergies between Sonic (medical) and Franklin (AI) teams."

Volpara Health Technologies Ltd (ASX: VHT)

Volpara is an ASX healthcare share that provides software for medical professionals to carry out breast screening and analysis to help them analyse a patient's risk and help inform them on the next steps.

The company says that its "focus on customer value" means that its "AI-powered image analysis enables radiologists to quantify breast tissue with precision and helps technologists produce mammograms with optimal image quality."

Volpara says that it has a "substantial growth outlook" which includes leveraging AI to create new models for image analysis and interpretation, as well as new applications of research data.

The ASX share has also revealed that Volpara's AI team is working with Microsoft on software to identify heart disease.

Motley Fool contributor Tristan Harrison has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has positions in and has recommended Microsoft, Temple & Webster Group, and Volpara Health Technologies. The Motley Fool Australia has positions in and has recommended Volpara Health Technologies. The Motley Fool Australia has recommended Sonic Healthcare and Temple & Webster Group. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

More on Share Market News

Man in mining hat with fists raised and eyes closed looking happy and excited about the Newcrest share price
Share Market News

Why BHP and these ASX dividend stocks are buys

The mining giant and these shares have been named as buys by brokers.

Read more »

a woman holds her finger to the side of her face and looks upwards as she thinks about something.
Share Market News

Where to invest when the ASX 200 hits an all time high?

With the ASX creeping towards a record high, here are some options to consider

Read more »

A male sharemarket analyst sits at his desk looking intently at his laptop with two other monitors next to him showing stock price movements
Share Market News

5 things to watch on the ASX 200 on Friday

Will the market end the week on a positive note? Let's find out.

Read more »

Young man with a laptop in hand watching stocks and trends on a digital chart.
Share Market News

Which investment trends drove equity markets in May according to Macquarie?

The ASX 200 increased 4.2% in May.

Read more »

Person pretends to types on laptop drawn in sand.
Share Gainers

Here are the top 10 ASX 200 shares today

It was a miserly session for investors today.

Read more »

Modern accountant woman in a light business suit in modern green office with documents and laptop.
Opinions

Too high? These 2 ASX shares might be due for a correction

These popular blue chips are looking dicey to me.

Read more »

A man clenches his fists in excitement as gold coins fall from the sky.
Broker Notes

These ASX 200 shares could rise 20% to 35%

These shares are being tipped to deliver market-beating returns by analysts.

Read more »

Keyboard button with the word sell on it.
Broker Notes

8 ASX All Ords stocks downgraded to sell ratings

Find out which shares are out of favour with the experts.

Read more »