Apollo Expert: Artificial Intelligence Has No Financial Return Outside Tech
Torsten Slok from Apollo stated that artificial intelligence has not yielded a financial return for American companies outside tech, pointing to the flat profit margins of S&P 493 companies.
Torsten Slok, chief economist at Apollo Global Management, said that artificial intelligence has not yielded a "financial return" for American companies outside the tech sector, despite massive investments and widespread hype around it. Slok based his analysis on what he calls the "S&P 493"—meaning the S&P 500 index after excluding Alphabet, Amazon, Apple, Meta, Microsoft, Nvidia, and Tesla.
Slok found no evidence of improved productivity in these companies' data, as profit margins and revenue per worker appeared nearly flat. "Despite massive investments and massive hype around AI, the tech has produced zero financial return for Corporate America outside of tech," he wrote.
Slok questioned the idea that non-tech companies will catch up with the giants over time, saying it will be difficult for American businesses to "translate increasingly cheap intelligence into higher top-line revenue growth and wider profit margins." He added that AI might be an excellent calculator, but business intelligence is fundamentally about "judgment and discretion," as he put it.
He explained that AI does not understand accountability, trust, culture, unwritten rules, ethical trade-offs, and fairness—factors that shape reputational risks and ultimately drive revenue growth and profit margins. This analysis comes at a time when companies are racing to spend billions of dollars on data centers and models, increasing the pressure to measure the actual return on these investments.
What Do These Terms Mean?
S&P 493: An informal term referring to the S&P 500 index after excluding the seven largest tech companies, used to measure the performance of the rest of the market away from the influence of tech giants.
Profit Margin: The percentage of revenue remaining after deducting costs, used to measure a company's efficiency in converting sales into profits.
Revenue Per Worker: Total company revenue divided by its number of employees, serving as a rough indicator of productivity.
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