What it is
A neural network is a series of algorithms that mimic the structure and function of the human brain to identify underlying relationships in a dataset. It consists of interconnected nodes, or "neurons," organized in layers: an input layer, one or more hidden layers, and an output layer. Data flows through these layers, with each neuron processing its input and passing the result to the next layer, learning to map inputs to outputs through iterative adjustments of connection strengths, known as weights.
Neural networks are foundational to modern AI and appear in news regarding advancements in machine learning, particularly deep learning applications. Their performance and size, often measured by the number of parameters, are key metrics discussed when new AI models are announced. Investors follow news about companies developing powerful neural networks, as they drive innovation in areas like computer vision, natural language processing, and predictive analytics across various industries.
Why it matters
Understanding neural networks helps retail investors grasp the core technology behind many AI products and the potential for market disruption.
Reviewed under editorial standardsUpdated September 26, 2026Not investment advice