Palihapitiya: The surge in the cost of calling AI words will erode corporate profits
Technology investor Chamath Palihapitiya said that large-scale use of artificial intelligence may have a negative impact on the profitability of some companies. Palihapitiya said in an interview with the American Consumer News and Business Channel: "In my opinion, the CEOs and CFOs of major companies are most likely completely unaware of the scale of unrestrained consumption of words within the company." Nowadays, more and more investors and technology executives are collectively warning that the era of uncontrolled overdraft of AI tokens is coming to an end, and Palihapitiya is one of them. Technology investor Chamath Palihapitiya said on Tuesday that large-scale deployment of artificial intelligence by enterprises will drag down the profits of some companies. One of the core reasons is that corporate executives have to deal with a huge expense that they were "completely unaware of existed within the company." "In my opinion, CEOs and CFOs of major companies are almost unaware of the seriousness of the unrestrained consumption of AI words within their own companies." Palihapitiya said in an interview. "I predict that there will be a scene like this in the future: the financial report of a certain quarter is less than expected, and the earnings per share is directly less than a few cents. At that time, the CEO will question the CFO: Where is the problem?" Palihapitiya is the founder of venture capital firm Social Capital, CEO of AI company 8090, and the host of the technology podcast "All-In." He is quite controversial in Silicon Valley: During the COVID-19 epidemic, he vigorously promoted special purpose acquisition companies (SPACs, shell companies listed on backdoor listings). Now a large number of related SPACs have collapsed, causing huge losses to investors. Talking about past SPAC investments, he said on Tuesday: "It was all speculators who lost money. I do feel sorry for them, and my interest position was not consistent with ordinary investors at that time." Palihapitiya said that "a few projects have been successful" in this batch of SPAC investments, but he also admitted that hyping SPACs on social media was a "major mistake." Last year, he launched a new SPAC - American Excellent Acquisition Company A (stock code AEXA), focusing on acquiring companies in the fields of artificial intelligence, energy, national defense, and decentralized finance. In 2024, Palihapitiya founded AI company 8090, which builds a collaboration platform for users to jointly develop enterprise-level software based on AI agents. In June this year, the company completed the Salesforce ) led a $135 million financing. At present, many investors and technology executives are warning that the "word overdraft era" in which companies encourage employees to use AI without restrictions and consume words like crazy is over, and Palihapitiya is one of the voices. He revealed in March this year that his startup’s annual AI-related expenditures may exceed $10 million. As a startup founder, this figure is “shocking.” Palihapitiya’s views on Tuesday about the high cost of AI coincide with the concerns of Palantir CEO Alex Karp. Earlier this month, Karp publicly criticized OpenAI and Anthropic’s per-term pricing model. Karp said in "Squawk Box": "I am not deliberately discrediting the two companies, but there are fundamental problems with this pricing model. The current common mentality of major domestic companies is: build it casually and waste a lot of budget on AI word consumption."