Ai's Rising Costs Undermine Bullish Bets Beyond Tech
WHO:
Fortune - Airbnb CEO Brian Chesky said employees who only manage people will have no future value and that managers must also contribute technically and stay connected to the product.
Fortune - Chesky cited former Apple chief design officer Jony Ive as an example of balancing product design and team leadership.
Fortune - Netflix co-CEO Ted Sarandos said, “A.I. is not going to take your job. The person who uses A.I. well might take your job.”
Business Insider - Jeff Bezos and JPMorgan CEO Jamie Dimon have proposed shorter workweeks as an alternative to AI-driven unemployment; Elon Musk has proposed government checks for people displaced by AI.
Fortune - Apollo chief economist Torsten Slok said “Maybe that will come in the future. Maybe not,” about whether AI will eventually produce financial returns at scale.
CNBC - Nvidia CEO Jensen Huang said CoreWeave did not need Nvidia’s backstop and that CoreWeave’s cost of capital was decreasing.
CNBC - Equity Armor Investments portfolio manager Brian Stutland questioned whether neocloud companies’ future customer contracts would remain stable.
Fortune - Apollo chief economist Torsten Slok said Corporate America does not need the latest AI model and “doesn’t want to pay for it.”
Fortune - Airbnb CEO Brian Chesky said “pure people managers” and employees who are rigid and resist change “will not survive the age of AI.”
Fast Company - Anthropic said it would dedicate 5% of its shares to a company-owned public benefit trust.
ABC News - Kazakhstan AI minister Zhaslan Madiyev, former Kazakhstan diplomat Dana Masalimova, and Indonesian National Economic Council vice chair Mari Pangestu discussed countries seeking to engage with both U.S.- and China-led AI initiatives.
CNBC - Nvidia CEO Jensen Huang said Nvidia’s neocloud partners had strong customer demand but lacked working capital; Nvidia described its AI cloud partners as constrained by the infrastructure needed to meet demand.
CNBC - Warren Hosseinion, co-founder of Compute Labs, said Nvidia was willing to act as an insurer while the market and industry caught up.
The Nerve - Roger McNamee said AI’s existential-risk claims were hype and argued the industry’s current financial model may be unviable.
The Nerve - McNamee said LLMs’ probabilistic errors can have serious consequences and argued that scaling compute and training data had hit a “speed bump.”
The Nerve - McNamee said neurosymbolic technology is among the alternative approaches being considered.
The Nerve - Roger McNamee said Anthropic’s planned IPO would give existing investors an opportunity to cash out rather than make new investors rich.
Business Insider - Microsoft cofounder Bill Gates said AI could eliminate telesales, telesupport, and accounting jobs; he also said humanoid robots could take over blue-collar work.
CNBC - Nvidia CEO Jensen Huang said neocloud demand was “off the charts” and that “what is missing in the middle is the working capital to fuel that growth.”
CNBC - Nvidia’s portfolio was valued at $99 billion in the second quarter and includes investments in OpenAI and Anthropic.
CNBC - David Trainer, founder and CEO of New Constructs, warned that insufficient compute demand could cause problems if expectations were not met.
Techmeme - Torsten Slok of Apollo Global Management said AI had delivered “zero financial payoff” to U.S. companies outside the technology sector.
Fortune - Torsten Slok is Apollo’s chief economist and issued warnings about the AI boom.
Fortune - Slok said most companies investing in AI had yet to see significant productivity returns.
Fortune - Slok said 80% of the top 1% of AI spenders are backed by venture capital.
Fortune - Mark Habib, S&P’s global head for digital infrastructure, warned about “interconnected financing structures” involving hyperscalers, data-center projects, and smaller AI companies.
Fortune - Meta CEO Mark Zuckerberg was mentioned in connection with a new class of shares intended partly to help him pay for a possible California wealth tax.
WHAT:
Fortune - Chesky said Airbnb’s AI use has been instrumental to the company’s success and called AI “the best thing that ever happened to Airbnb.”
Fortune - Nvidia CEO Jensen Huang said in 2025, “Every job will be affected, and immediately,” and advised everyone to use AI.
Business Insider - Gates said the AI transition could make “none of the things that human labor provides to the economy” necessary for most goods and services.
Yahoo Finance - Meta reported revenue of $64.6 billion, up 26% year over year, and free cash flow of negative $2.1 billion.
Yahoo Finance - Meta raised the low end of its 2026 capital-spending forecast to $135 billion, keeping the range at $135 billion–$145 billion, and announced non-voting shares to facilitate future fundraising.
Yahoo Finance - Amazon, Alphabet, Meta, Microsoft, and Oracle are projected to spend nearly $780 billion in 2026 and more than $1 trillion annually from 2027 through 2030.
Yahoo Finance - Nvidia fell 4.4%, CoreWeave 10.1%, and Lam Research 11.8%; the iShares Semiconductor ETF fell 6.8%, and the Nasdaq dropped 2.6%.
Yahoo Finance - The equal-weighted S&P 500 rose 0.7%, while the market-cap-weighted S&P 500 fell 1.2%; the Dow rose 0.02% and the Russell 2000 rose 0.11%.
Yahoo Finance - The 2-year Treasury yield fell to 4.64%, and the 10-year yield dropped below 5%.
Bloomberg Markets - Natixis chief APAC economist Alicia Garcia Herrero said rapid AI adoption could be inflationary if data-center construction falls short of compute demand.
Bloomberg - A Blackstone-led $2.3 billion private-credit loan to CoreWeave was described as a blueprint for chip-backed debt, a market projected to reach $1 trillion.
CNBC - Nvidia’s Vera Rubin rack is seven feet tall and contains 72 GPUs; Morgan Stanley estimated it costs more than $7 million.
CNBC - Nvidia’s August financing agreement with six asset managers included up to $125 billion in residual-value guarantees on GPU financing.
The Nerve - Roger McNamee said AI infrastructure borrowing had exhausted investor appetite and could cause hundreds of billions of dollars in write-offs.
The Nerve - Roger McNamee said AI companies’ current products may fail consumer safety standards, citing chatbot involvement in a British Columbia elementary school shooting and several suicides, and studies linking chatbot use to cognitive impairment.
The Nerve - McNamee said the AI industry had invested at least $1.4 trillion while AI processors were still priced like supercomputers; he contrasted this with Google’s early search infrastructure, built using bare Intel motherboards costing about 0.1% of early internet supercomputers.
The Nerve - McNamee said banks were repackaging risky AI debt for pension plans and insurance companies, potentially spreading financial-crisis losses across the population.
Business Insider - Bill Gates said AI-driven job disruption could be “as tumultuous a period as there's been in human history,” and described work as a source of purpose, income, daily routine, relationships, and opportunities to solve problems.
Fortune - Meta’s five-year credit default swaps widened 7.6 basis points to a record 114.79 basis points.
Fast Company - Newman’s Own has reportedly generated more than $600 million in charitable donations since actor Paul Newman founded it.
ABC News - Kazakhstan joined the U.S.-led Pax Silica and became a founding member of China’s World AI Cooperation Organization, which has 28 other initial founding countries, including Pakistan and Russia.
ABC News - Kazakhstan signed an investment deal worth up to $10 billion involving Nvidia to develop a “data center valley”; Chinese foreign direct investment in Kazakhstan reached a record $2.8 billion.
ABC News - China has provided grants and loans for AI-related projects in at least 77 low- and middle-income countries, according to AidData.
TechCrunch - The AI projects and startups roundup cites Apple’s repeatedly delayed Siri AI and OpenAI’s “super app” launch among projects that shut down or missed expectations.
CNBC - Nvidia’s latest fiscal-year revenue was $216 billion, roughly eight times its revenue before ChatGPT launched.
CNBC - CoreWeave, Nebius, and IREN shares were each down at least 30% that month; Nvidia stock was down 7.6% that month, its worst monthly performance since November of the previous year.
CNBC - Australian AI cloud provider Firmus withdrew its IPO plans; U.K. company Nscale and SoftBank-backed SB Energy had filed to go public in the U.S. but had not updated their plans in weeks.
CNBC - Google rents its tensor processing units through its cloud service, while AMD launched its Helios AI rack.
CNBC - Nvidia’s guarantee on the Pike County, Ohio, project can end if OpenAI posts sufficient collateral or achieves a high enough credit rating.
The Nerve - Roger McNamee said AI’s reliance on copyrighted material and private data could expose government information and secrets as training data.
The Nerve - McNamee said AI-related borrowing was compounded by inflationary pressures from the war in Iran and tariffs on imported goods, and said Oracle, SoftBank, and CoreWeave were in financial distress.
Business Insider - Bill Gates said AI could eventually enable robots to build houses, grow food, and perform surgery; he also described possible limits on AI use, similar to the Amish approach.
Yahoo Finance - Social Security’s 2027 cost-of-living adjustment is 3.6%, the third-highest since 2012 and fifth-highest in 35 years.
Yahoo Finance - The Social Security Administration said the Old-Age and Survivors Insurance Trust Fund could pay benefits at the current rate until the fourth quarter of 2032; after depletion, incoming tax revenue would cover 78% of benefits.
Yahoo Finance - The Senior Citizens League said Social Security benefits lost 13.7% of purchasing power from 2016 to 2026.
The Nerve - McNamee said 10 major companies are competing with the same technology, training data, use cases, and customers, and that experience suggests only two may become profitable.
The Nerve - McNamee said the AI industry may face hundreds of billions of dollars in write-offs and that its infrastructure borrowing competes with refinancing U.S. national debt.
The Nerve - McNamee cited hacks of Hugging Face and Australian government agencies, chatbot involvement in a British Columbia elementary school shooting and suicides, and studies linking chatbot use to cognitive impairment.
The Nerve - McNamee said AI-related risks include cybersecurity, fraud, reduced productivity, student and worker deskilling, harmful advice, social isolation, and mistakes in warfare.
The Nerve - McNamee said AI infrastructure costs had fallen by nearly three orders of magnitude between early internet supercomputers and Google’s search infrastructure; he said bare Intel motherboards cost roughly 0.1% of early supercomputers.
The Nerve - McNamee said banks were repackaging risky AI debt for sale to pension plans and insurance companies, spreading potential losses across the population.
The Nerve - Anthropic filed IPO paperwork, with a desired valuation that could exceed $2 trillion.
The Nerve - McNamee said the AI industry invested at least $1.4 trillion in infrastructure and committed an additional $3 trillion or more in future obligations.
The Nerve - McNamee said open-weight and open-source language models were gaining market share because they cost less, could replace frontier models in many uses, and let customers retain control of their data.
Business Insider - Gates said the transition to AI-driven abundance could involve 20 years of disruption, winners and losers, and major job losses.
CNBC - Nvidia reported $36 billion in off-balance-sheet AI-cloud backstops for neoclouds and a guarantee of up to $105 billion for an OpenAI data center project in Ohio; it also signed for $20 billion in future data-center leases to be assigned to third parties.
CNBC - Nvidia’s August filing outlined more than $500 billion in off-balance-sheet commitments, mostly maturing through fiscal 2029.
CNBC - Nvidia and six asset managers announced a $500 billion infrastructure-financing initiative, including up to $125 billion in residual-value guarantees on GPU financing.
CNBC - Nvidia committed up to $6.3 billion to buy CoreWeave computing capacity if CoreWeave could not find another buyer; CoreWeave had about $51.6 billion in total debt, and yields on bonds maturing in 2031 and 2032 exceeded 15%.
CNBC - Nvidia seeded $2 billion in Brookfield’s AI Infrastructure Partners Fund, which aims to raise $10 billion; KKR’s Helix Digital Infrastructure is an $11 billion vehicle, and Valor Equity Partners’ dedicated compute fund is $5.4 billion.
CNBC - Nvidia generated $70 billion in free cash flow in the first half of the year; AMD generated just over $4 billion, while Alphabet was cash-flow negative in the second quarter.
CNBC - Nvidia’s Vera Rubin rack contains 72 GPUs, weighs as much as a pickup truck, and costs more than $7 million, according to Morgan Stanley.
CNBC - Nvidia’s Ohio project guarantee requires use of its hardware for at least 20 years; if OpenAI defaults, Nvidia may take over the lease or cover up to $105 billion of a shortfall if the facility is resold or released below a minimum price.
Techmeme - AI was described as a margin-hurting cost center for U.S. companies outside tech, while venture-backed firms were spending more on tokens.
Fortune - Slok said compute-demand growth had slowed and that the demand curve was flat and highly sensitive to price changes.
Fortune - Slok called the AI bull case’s “core economic flaw” the marginal cost of producing compute exceeding its marginal benefit to users.
Fortune - Slok said the price users will pay for compute—not physical capacity or power—is the main determinant of data-center construction models.
Fortune - Slok said 80% of the top 1% of AI spenders are VC-backed, suggesting startups may be paying compute bills with venture capital rather than organic earnings.
Fortune - Slok said profit margins and revenue per worker were rising for the Magnificent Seven, but not for the rest of the S&P 500.
Fortune - Slok said AI “may be a great calculator,” but business intelligence largely involves judgment, context, accountability, trust, culture, unwritten rules, ethical trade-offs, and fairness.
Fortune - A handful of hyperscalers were estimated to spend $800 billion on capital expenditures this year, with next year’s spending expected to exceed $1 trillion.
Fortune - Meta planned to spend $135 billion–$145 billion this year. Its five-year credit default swaps reached a record 114.79 basis points after widening 7.6 basis points.
Fortune - CoreWeave stock fell more than 30% this month, and its five-year credit default swaps rose to 1,145 basis points.
Fortune - Habib said, “It is safe to assume that there is more (debt) out there that we are not seeing,” and said undisclosed liabilities may not be visible to S&P.
Fortune - Meta announced a new class of shares, partly to help Zuckerberg pay for a possible California wealth tax.
WHERE:
CNBC - Nvidia’s proposed OpenAI data center in Pike County, Ohio, is planned as a 10-gigawatt facility.
ABC News - France is pursuing AI development through startup Mistral; Japan may use lower-cost Chinese AI models for lower-risk applications.
ABC News - Kazakhstan is seeking investment and AI partnerships from both the United States and China; Indonesia has joined China’s World AI Cooperation Organization, and Singapore is considering joining it.
ABC News - Anthropic is establishing an Asia office in Singapore; Saudi startup Humain unveiled a platform built on a Chinese company’s open model.
ABC News - China-backed AI project recipients include Nigeria, Zambia, Ghana, Bangladesh, Senegal, Cameroon, and Kenya.
CNBC - Nvidia CEO Jensen Huang discussed neocloud demand at the company’s GTC conference in Berlin.
CNBC - Nvidia’s proposed OpenAI data-center project is in Pike County, Ohio.
Fortune - Habib made his remarks during a roundtable in London.
Fortune - The reported lack of AI financial payoff applied to U.S. companies outside major hyperscalers.
WHEN:
Business Insider - Gates described a 20-year transition before AI creates “true abundance.”
Business Insider - Gates described the period before AI creates “true abundance” as the next two decades.
WHY:
Fortune - Chesky said companies that are prepared to change and transform are more likely to benefit from AI, while companies that do not change risk disruption.
Fortune - Chesky said workers need a “growth mindset” to learn AI tools and adapt to changing company structures and work.
Business Insider - Gates said work provides purpose, income, daily routine, relationships with colleagues, and opportunities to build things and solve problems.
Yahoo Finance - Meta said peers’ recent capital raises and expected fundraising by Anthropic and OpenAI have created an “increasingly challenging fundraising environment.”
Yahoo Finance - Broadcom CEO Hock Tan warned capital could become AI development’s biggest constraint; BlackRock CEO Larry Fink said competition for capital was the fiercest of his career.
ABC News - The U.S. State Department said countries cannot be trusted Pax Silica partners while substantively participating in initiatives advancing a competing vision for superintelligence.
Fortune - Chesky said managers need to combine people leadership with technical work and remain connected to the product; workers need to adapt and learn AI tools.
ABC News - Countries are weighing access to advanced U.S. chips and AI against China’s more affordable, open-source systems while trying to avoid losing partnerships or influence.
CNBC - Nvidia said its financing support helps customers build infrastructure to meet chip demand and can enable AI labs to develop models and services that generate further demand for Nvidia products.
CNBC - Nvidia said its AI cloud backstops generally require payment only if project participants default.
The Nerve - McNamee argued that general-purpose AI products require customers to spend substantial time and money integrating them into existing systems, unlike narrowly focused applications with immediate returns.
The Nerve - McNamee said AI companies used existential-risk language to portray AI as inevitable and avoid accountability for negative consequences.
Fortune - Slok said companies will pay high prices for compute only if it generates higher revenue growth, bigger profits, or substantial savings; he said there was little evidence those outcomes existed at scale.
Fortune - Slok said slow-to-materialize returns implied growing reluctance among firms to pay for AI services.
HOW:
The Nerve - Roger McNamee said open-weight and open-source language models are gaining market share because they cost less, can substitute for frontier models in many uses, and allow customers to retain control of their data.
CNBC - If OpenAI defaults on the Pike County facility, Nvidia can take over the lease, seek a new tenant, or ask SB Energy to sell the facility; for a sale or release below a minimum price, Nvidia’s guarantee can cover the difference up to $105 billion.
Fast Company - Anthropic’s proposed public benefit trust would hold 5% of its shares; the article estimated that equivalent shares reserved by Google before its 2004 IPO would be worth $184 billion today.
CNBC - Nvidia’s support for neoclouds can include guaranteeing minimum resale prices or minimum hourly chip-offtake prices; deals with Sharon AI and other neoclouds have also included revenue-sharing agreements.
Yahoo Finance - The Social Security program has drawn on its trust fund since 2009 because tax revenue has not covered benefit payments.
The Nerve - McNamee said AI systems that hacked organizations were programmed to hack and lie about it, and argued that describing AI as acting independently can evade accountability.
Business Insider - Gates suggested early retirement and limits on working hours could help preserve some human employment; he also described reserving activities such as art, sports, cooking, and childcare for people.
CNBC - Nvidia’s customer support includes equity investments, loan guarantees, minimum resale-price or chip-offtake guarantees, and revenue-sharing agreements.
Fortune - Slok said AI startups’ compute spending may be funded by venture capital, while AI firms’ financing deals can involve providing money or guaranteeing debt for other companies that are also major customers.
Fortune - Meta’s five-year credit default swaps were used to insure its debt against default.
(UPDATED October 26, 2026 04:06 UTC)
AI investment is surging, but questions are growing about whether it will deliver returns and how its costs will be financed. Apollo economist Torsten Slok said most companies investing in AI have yet to see significant productivity gains, and businesses outside tech have seen no financial payoff. Nvidia chief Jensen Huang said demand for AI cloud services is exceptionally strong, but providers lack the working capital to expand. He also said CoreWeave does not need Nvidia’s financial backstop. Meanwhile, Meta reported revenue of $64.6 billion and raised the low end of its 2026 spending forecast to $135 billion, as major technology companies’ planned spending continues to climb. Airbnb’s Brian Chesky said managers must contribute technically and stay close to products, warning that people managers resistant to change may not survive the AI era.
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(UPDATED October 26, 2026 02:14 UTC)
Concerns are growing over whether the enormous spending on artificial intelligence will generate lasting returns. Apollo economist Torsten Slok said most companies investing in AI have yet to see significant productivity gains, and businesses outside technology have seen no financial payoff. Meanwhile, Amazon, Alphabet, Meta, Microsoft, and Oracle are projected to spend nearly $780 billion in 2026. Meta reported revenue up 26% to $64.6 billion, but free cash flow was negative $2.1 billion, and it raised its capital-spending forecast to as much as $145 billion. Nvidia chief Jensen Huang said neocloud providers have strong demand but lack working capital, while defending CoreWeave’s finances. Technology stocks fell sharply, with Nvidia down 4.4% and the Nasdaq down 2.6%. Investors also face warnings about risky AI-related borrowing and uncertain demand.
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(UPDATED October 26, 2026 00:01 UTC)
Nvidia is stepping in to support a booming but cash-strapped AI infrastructure market, as CEO Jensen Huang says neocloud demand is “off the charts” and partners need working capital to grow. The company has offered financing guarantees, while CoreWeave’s cost of capital is falling, Huang said. Still, investors are questioning whether future contracts and demand will justify the spending. Apollo economist Torsten Slok says most companies have yet to see significant productivity gains from AI, and businesses outside technology have seen no financial payoff. Investor Roger McNamee warns that costly infrastructure borrowing could trigger major write-offs, while arguing the industry’s financial model may not hold up. Microsoft cofounder Bill Gates says AI could displace jobs in sales, support, accounting, and blue-collar work, making disruption deeply consequential for workers.
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(UPDATED October 25, 2026 23:01 UTC)
Nvidia chief Jensen Huang says demand for AI cloud services is surging, but smaller providers lack the working capital to build enough infrastructure. Nvidia has offered support, while its partners face financing risks and some AI-related stocks have fallen sharply. Apollo economist Torsten Slok says companies outside technology have seen little financial payoff from AI, and most have not recorded significant productivity gains. He also says businesses don’t need the newest models and don’t want to pay for them. Investor Roger McNamee warns that AI’s costly business model may not be viable, citing errors, safety concerns, and borrowing that could spread losses. He says the industry may need alternatives to simply scaling up computing. Meanwhile, Bill Gates warns AI could disrupt jobs from telesales and accounting to physical labor, while Anthropic plans to place 5% of its shares in a public benefit trust.
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(UPDATED October 25, 2026 18:59 UTC)
The AI boom is drawing sharp warnings even as investment and demand surge. Nvidia chief Jensen Huang says demand from AI cloud partners is “off the charts,” but they lack the working capital and infrastructure to keep up; Nvidia is willing to help bridge the gap. Its latest fiscal-year revenue reached $216 billion, while several AI cloud stocks have fallen sharply and one provider withdrew its IPO plans. Apollo economist Torsten Slok says most companies investing in AI have yet to see significant productivity gains. Investor Roger McNamee questions the industry’s financial model, warning that costly infrastructure, borrowing and unreliable AI outputs could bring serious risks. Anthropic has filed IPO paperwork, while McNamee says cheaper open models are gaining ground. Meanwhile, Kazakhstan has joined U.S.- and China-led AI initiatives and signed a deal worth up to $10 billion to develop a data-center hub.
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(UPDATED October 25, 2026 17:57 UTC)
Nvidia is backing an AI infrastructure boom even as its cloud partners struggle to finance expansion. CEO Jensen Huang says demand is “off the charts,” but working capital is missing; Nvidia has disclosed billions in cloud backstops and a guarantee for an OpenAI data center project in Ohio. The company also reported more than $500 billion in off-balance-sheet commitments, while CoreWeave carries heavy debt and faces high borrowing costs. Nvidia’s revenue has surged, but its shares and several AI cloud companies have fallen sharply. Investors and economists warn that AI spending may not deliver expected returns: Apollo’s Torsten Slok says companies outside tech have yet to see meaningful financial gains. Investor Roger McNamee questions the industry’s business model and warns of costly risks, while Anthropic has filed IPO paperwork.
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(UPDATED October 25, 2026 17:02 UTC)
Warnings are mounting that the AI boom may be built on spending and borrowing that are difficult to sustain. Investor Roger McNamee says major companies are competing with similar technology, while only a few may become profitable; he also argues that AI’s financial model may be unviable. Apollo economist Torsten Slok says companies outside tech have seen little financial payoff, and that compute demand is slowing as customers resist prices. Meanwhile, Nvidia has made extensive commitments tied to AI cloud providers and data-center projects, including guarantees and future obligations worth hundreds of billions of dollars. Analysts warn that complex financing could spread losses if demand falls short. Nvidia says demand from cloud providers is exceptionally strong, but McNamee questions whether scaling data and computing power can continue. He also points to errors and safety risks, while Bill Gates warns that AI and humanoid robots could eliminate many jobs.
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(UPDATED October 25, 2026 16:00 UTC)
Nvidia’s expanding financial ties to the AI boom are raising questions about how much risk is building across the industry. The company has reported hundreds of billions of dollars in commitments, including guarantees tied to neoclouds and an OpenAI data center in Ohio, plus agreements to buy computing capacity and support chip financing. Nvidia says demand is surging, but Apollo economist Torsten Slok says most companies outside major technology firms have yet to see meaningful financial returns from AI. He warns that compute costs may exceed the value businesses receive, while venture capital may be funding much of the demand. Investors are also watching CoreWeave, whose shares have fallen sharply and whose debt costs have climbed. Meanwhile, Anthropic has filed IPO paperwork targeting a valuation above $2 trillion. Bill Gates warns AI could disrupt jobs for decades, including office and blue-collar work.
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(UPDATED October 25, 2026 07:59 UTC)
Nvidia is backing the AI boom with a web of financing commitments, while economists warn that returns may not justify the spending. The company reported more than $500 billion in off-balance-sheet commitments, including guarantees for AI cloud providers and up to $105 billion tied to an OpenAI data-center project in Ohio. It also announced a $500 billion infrastructure-financing initiative with six asset managers. CEO Jensen Huang said demand from specialized cloud providers was “off the charts,” but said working capital was needed to support growth. Apollo economist Torsten Slok said most companies investing in AI had yet to see significant productivity gains, and that AI had delivered no financial payoff outside technology. He also warned that compute demand was slowing and users’ willingness to pay would shape data-center construction. Credit concerns are emerging: CoreWeave’s shares fell more than 30% this month, while its debt-insurance costs surged.
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(UPDATED October 25, 2026 07:08 UTC)
Apollo chief economist Torsten Slok says AI has yet to deliver significant financial returns for most U.S. companies outside major technology firms. He describes AI as a cost center that can squeeze margins, while warning that compute demand has slowed and is highly sensitive to price. Slok says companies will pay more only if AI boosts revenue, profits, or savings, and evidence of those gains at scale remains limited. He also points to a divide: profit margins and revenue per worker are rising at the biggest technology companies, but not across the rest of the S&P 500. Meanwhile, a small group of hyperscalers is expected to spend more than a trillion dollars on capital projects next year. At a London roundtable, S&P executive Mark Habib warned of hard-to-see debt links among data centers, hyperscalers, and AI startups. Meta’s debt-insurance costs have also climbed to a record.