"Artificial intelligence has fueled a multi-trillion-dollar stock market surge over the past few years, propelling companies like Microsoft ( NASDAQ:MSFT ) and Nvidia ( NASDAQ:NVDA ) to record valuations. Investors poured funds into AI on promises of transformative efficiency and new revenue streams, driving the S&P 500 's tech-heavy gains. Yet doubts about AI's staying power are mounting as evidence shows limited returns on investment. Meta Platforms ( NASDAQ:META ), for instance, implemented an AI hiring freeze in August after aggressive poaching, signaling a pause amid restructuring and bubble fears."
"Studies from Gartner, McKinsey, and MIT underscore the issue: Gartner's 2024 forecast predicted 30% of generative AI projects would be abandoned by year's end due to poor data quality and unclear value, while McKinsey's 2025 survey found only 39% of organizations report enterprise-wide EBIT impact from AI, with many citing meager cost savings. MIT research similarly highlighted implementation hurdles yielding under 50% ROI in most cases."
Artificial intelligence drove a multi-trillion-dollar stock-market surge, boosting Microsoft and Nvidia to record valuations as investors anticipated efficiency gains and new revenue. Doubts emerged as evidence showed limited returns on investment, prompting moves like Meta's AI hiring freeze after aggressive poaching. Industry research found many projects failing or delivering weak ROI: Gartner predicted 30% of generative AI projects would be abandoned in 2024, McKinsey reported only 39% of organizations saw enterprise-wide EBIT impact, and MIT documented under-50% ROI in most implementations. Microsoft reportedly reduced AI software sales quotas after sales teams missed targets amid customer resistance to premium pricing.
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