Apollo economist says AI offers zero payoff to non-tech firms

Torsten Slok, chief economist at Apollo Global Management, stated that AI has delivered zero financial payoff to corporate America outside of the tech industry. Slok analyzed the S&P 493, which excludes major tech firms, and found that profit margins and revenue per worker appear flat. Apollo claims there is no evidence that AI is improving productivity for these non-tech companies. Slok argued that it will be difficult for these firms to turn increasingly cheap intelligence into higher revenue growth and profit margins.

Apollo noted that corporate America is starting to view token spending as a cost center that weighs on company margins. The firm also observed a slowdown in token spending growth, claiming this shows spending is highly price-sensitive. Slok wrote that AI does not understand accountability, trust, culture, unwritten rules, ethical trade-offs, or fairness. Apollo posted charts to its Daily Spark blog to back up these claims.

Some observers pushed back against Apollo's assertion on social media, noting they did not recognize the picture painted by Slok. A PwC report found that the majority of chief executives had enjoyed neither increased revenue nor decreased costs from AI despite heavy investment. Research from Deloitte showed that adopting AI tools has not helped the bottom line for most companies. McKinsey reckons the corporate world is at a turning point, conceding that the number of businesses reporting an actual earnings boost from AI initiatives has remained flat.