Companies and investors dramatically increased AI spending in early 2025, with AI startups raising over $44 billion in the first half and total investments projected to approach almost $200 billion by year-end. Investors have effectively bet on unprecedented labor productivity gains from AI. MIT researchers found that 95 percent of attempts to incorporate generative AI into business are failing and only about 5 percent of businesses achieve rapid revenue acceleration. Leading AI products complete roughly 30 percent of real-world office tasks, and previously projected contributions of over $6 trillion by 2030 would require exponential productivity improvements to materialize.
With AI software increasingly hogging the enterprise spotlight, companies and investors are spending like never before. In the first half of 2025, AI startups raised over $44 billion, more than all of 2024 combined. By the end of this year, a Goldman Sachs analysis estimates that total investments in AI will soar to almost$200 billion. But all that money is, to put it gently, a reckless gamble.
A new report by researchers at MIT, first covered by Fortune, found that a staggering 95 percent of attempts to incorporate generative AI into business so far are failing. According to the report, titled "The GenAI Divide: State of AI in Business 2025," the MIT researchers found that only around 5 percent of businesses succeed at "rapid revenue acceleration," with the vast majority falling flat.
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