Apollo economist: AI has delivered no financial payoff to most companies
The chief economist of private equity firm Apollo Global Management says US companies outside the tech sector have gained no financial benefit from artificial intelligence. Profit margins and revenue per worker appear flat, he found.
Torsten Slok, chief economist at Apollo Global Management, a US private equity firm that formerly owned TechCrunch, has concluded in a recently published note that artificial intelligence (AI) has not improved the bottom line of big American corporations outside the technology industry. The finding matters because companies and investors are pouring very large sums into AI, hoping for higher productivity and profits.
How the analysis was framed
Slok looked at what he calls the S&P 493: the S&P 500 stock index with seven companies removed — Alphabet, Amazon, Apple, Meta, Microsoft, Nvidia and Tesla. In these firms, he found, profit margins and revenue per worker appear flat, with no evidence that AI is boosting productivity.
“Despite massive investments and widespread hype around artificial intelligence, the technology has delivered zero financial payoff to corporate America outside of tech,” Slok said.
Just a matter of time?
Slok is skeptical that non-tech firms are merely lagging behind the tech giants. He argues it will be difficult for corporate America to “turn increasingly cheap intelligence into higher revenue growth and higher profit margins.”
He also wrote that AI may be a great calculator, but in business intelligence is mostly judgment. In his view, AI does not understand accountability, trust, culture, unwritten rules, ethical trade-offs or fairness, all of which shape reputational risk and ultimately drive revenue growth and profit margins.
TechCrunch adds that other recent studies have likewise found that AI has yet to deliver significant productivity gains.
