BAC Stock Hits Record High After Q2 Earnings – Bank Of America CEO Says It’s A ‘Good Environment’ For AI Buildout

• In an interview with CNBC, Bank of America CEO Brian Moynihan said the AI infrastructure buildout still has significant room to grow.
• Moynihan said investment banking pipelines strengthened during the quarter and attributed much of the surge in trading activity to the AI investment cycle.
• He also stated that the bank remains comfortable financing AI infrastructure projects.

Bank of America (BAC) CEO Brian Moynihan said on Monday that the artificial intelligence (AI) infrastructure boom still has a long runway, arguing that demand for financing AI projects continues to support investment banking activity even after a blockbuster quarter for Wall Street.

"We still have very strong pipelines in investment banking. The IPOs and deals are still getting done, and very strong interest in doing transactions,” he told CNBC in an interview. "The AI buildout still has a lot of debt funding and other funding required, so it's a very good environment."

His comments came after Bank of America reported second-quarter (Q2) earnings that topped Wall Street expectations. The bank posted revenue of $31.6 billion, beating analyst estimates of $30.7 billion. Its earnings per share (EPS) came in at $1.21, ahead of the estimated earnings of $1.13 per share.

BAC’s stock gained over 2% in midday trade after hitting a new record high of over $61 and was among the top trending tickers on Stocktwits at the time of writing.

Retail sentiment around the bank on the platform rose to ‘bullish’ from ‘neutral’ territory over the past day, while chatter remained at ‘normal’ levels.

AI Financing Demand Continues To Support Deal making

In the interview, Moynihan stated that the bank’s investment banking pipeline has strengthened through the quarter. Bank of America's investment banking revenue surged 50% year over year, while sales and trading revenue rose 30%.

Equities trading saw the biggest jump, over 70%, helping drive the bank's strongest quarterly performance in years. Moynihan attributed much of that momentum to the AI investment cycle. "A lot of it's the AI trading,” he said.

He attributed much of the activity over the past year to the global AI buildout, particularly outside the U.S., and dismissed concerns that banks are taking excessive risk in financing AI infrastructure projects such as data centers. The CEO stated that the bank evaluates the long-term tenants occupying data centers and compares contract durations with the assets' useful lives before extending financing.

"We're very comfortable with how we underwrite credit."
– Brian Moynihan, CEO, Bank of America

Bank Of America Expands Internal AI Adoption

Moynihan said the bank has approved more than 100 AI use cases, with around 40 already deployed across the business. He added that the bank’s virtual assistant Erica now serves more than 20 million users, who interacted with the platform 200 million times during the quarter.

Rather than replace workers, Moynihan said AI is helping improve productivity while allowing the bank to manage staffing largely through attrition. "We don't do something just for kicks. We do it because it's going to have a return to it,” he said.

BAC’s stock has gained over 10% this year and nearly 30% over the past 12 months.

Read also: IBM Stock Tanks To 2-Month Lows In Pre-Market – CEO Says Company ‘Faltered’ In Q2 As ‘Large Deals Failed To Close’ On Expected Timelines

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