What it is
An LLM is a type of artificial intelligence built using deep learning techniques, specifically transformer architectures. It learns patterns, grammar, and context by processing enormous amounts of text data from the internet, books, and other sources. This extensive training enables it to perform various language-related tasks, such as generating coherent text, translating languages, summarizing documents, and answering questions, by predicting the next most probable word in a sequence.
LLMs are foundational to many modern AI applications, appearing in products like chatbots, search engines, and content creation tools. Their development and deployment drive significant investment in compute infrastructure and AI startups. When an LLM powers a service, its performance, cost, and capabilities often dictate the user experience and market competitiveness, influencing technology stock valuations and enterprise AI adoption trends.
Why it matters
LLMs are at the core of new AI products that can change how we work and access information, impacting tech innovation and investment opportunities.
Reviewed under editorial standardsUpdated September 26, 2026Not investment advice