Apollo economist says AI has yet to lift profits or productivity at most US firms
For the S&P 493, outside the largest tech companies, margins and output per worker show little change despite heavy AI spending.
An economist at Apollo Global Management, Torsten Slok, has argued in a recent note that AI has not improved profits or productivity at large US companies outside the tech sector. Looking at the S&P 493, the S&P 500 without Alphabet, Amazon, Apple, Meta, Microsoft, Nvidia and Tesla, he found profit margins and revenue per worker essentially flat despite heavy spending. Slok doubts firms can turn cheaper machine intelligence into faster revenue or fatter margins, reasoning that business success depends on judgment, accountability and trust, which software does not supply. Other recent studies have reached a similar conclusion that AI has not yet produced meaningful productivity gains.
Why it matters
The note suggests that for most large US companies outside tech, AI spending has not yet shown up in the numbers investors and managers look at, such as profit margins and revenue per worker. Slok's argument is that cheaper machine intelligence does not by itself produce higher revenue, because business success rests on accountability, trust and judgment. Other recent studies point the same way, so the gap between investment and measured return is the central question for the coming period.
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