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Investors are “overexcited” about artificial intelligence even as the world’s largest technology companies are expected to spend about $320 billion this year building AI infrastructure, OpenAI CEO Sam Altman has warned.
“When bubbles happen, smart people get overexcited about a kernel of truth,” Altman told The Verge recently, comparing the current AI boom to the late-1990s dot-com frenzy. He added that some investors may eventually be “burned” as hype fades, but maintained that AI’s long-term potential remains enormous.
Altman’s comments come as Microsoft (NASDAQ:MSFT), Meta Platforms (NASDAQ:META), Amazon (NASDAQ:AMZN) and Alphabet (NASDAQ:GOOGL, GOOG)) continue racing to dominate the fast-growing AI industry.
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Microsoft announced in January that the company plans to invest about $80 billion this year in AI-enabled data centers — its largest infrastructure budget to date.
Meanwhile, Amazon, Meta Platforms and Alphabet are also increasing their capital spending. According to Amazon’s Q2 earnings report released in July, the company is scaling up its cloud infrastructure for AI-driven services.
Meta said in July that capital expenditures in the range of $66 billion to $72 billion and Alphabet said the same month that continued investment in data-center infrastructure remains a major cost driver. Altogether, analysts estimate total AI-related investments among major tech firms could exceed $320 billion this year.
OpenAI itself continues to expand. On Oct. 6, at its DevDay event in San Francisco, OpenAI introduced new tools that allow developers to integrate ChatGPT into apps and workflows. The event highlighted OpenAI’s growing focus on enterprise adoption and partnerships that extend the use of its AI systems across industries.
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The “AI revolution will fuel a tech bull market for the next two to three years at least,” Wedbush Securities analyst Dan Ives told Fortune, describing this stage as “a 1996 moment, not 1999.” While Altman sounded cautious, several analysts see continued opportunity.
