Starboard Value’s Jeff Smith called artificial intelligence a key technological advance similar to the internet, and said many companies will benefit from the megatrend. “AI is an enormous opportunity,” Smith said on CNBC’s ” Squawk on the Street ” Tuesday. “There’s been a few technology advancements over the last 20 plus years that have been able to do things like that. The internet was one to start with … maybe you talk about cryptocurrency blockchain and then you might talk about AI.” AI has been dominating headlines this year, creating a buying frenzy on Wall Street that pushed chipmaker Nvidia over a $1 trillion market cap. Buzzy chatbot ChatGPT, capable of taking written inputs from users and producing a human-like response, was an instant phenomenon globally, becoming the fastest-growing software in history. “I do believe that technology will continue to advance,” Smith said. “I believe it will do two things. It will make companies more efficient. It will also increase demand for products for the companies that do it right.” Smith said AI is an “enormous opportunity” for Salesforce , the software company that he took an activist stake in in 2022. Shares of Salesforce have rallied more than 70% this year. “What they’ve done is pretty dramatic. I mean, they’ve raised their their margins by 800 basis points. Revenue growth did slow a little bit, which was expected,” Smith said of Salesforce. The hedge fund manager said there’s more room for Salesforce to grow and the stock can rally another 30%. “We think it’s probably $15 a share in free cash flow in the next couple of years. We think that means the stock should be over $300 a share. It’s still undervalued,” Smith said. “There’s still more to be done and I think they would agree.” Smith said he’s also bullish on software name Splunk , which he said is slightly behind Salesforce in terms of execution. “It’s a similar opportunity as a company that was not focused on profit margins, but instead just focused on growth and now they’re focused on a balance of revenue growth and profitability,” Smith said. “With that focus, we actually think that they can almost double their free cash flow per share in the next couple of years.” Shares of Splunk have risen more than 20% this year. Smith spun his New York-based hedge fund out of investment firm Ramius in 2011.