Despite massive investments in artificial intelligence and growing business interest in the technology, companies outside the technology sector have so far not shown any notable improvement in financial performance thanks to AI. This is the conclusion reached by Torsten Slok, chief economist at investment firm Apollo Global Management, after analyzing data from the largest U.S. corporations.

Slok examined the so-called S&P 493 — the S&P 500 index excluding the seven largest technology companies: Alphabet, Amazon, Apple, Meta, Microsoft, Nvidia, and Tesla. In his assessment, profitability and revenue per employee among the remaining 493 companies have remained virtually unchanged. This does not suggest that AI adoption has already led to a noticeable increase in productivity.

“Despite massive investments and widespread hype around artificial intelligence, outside the technology sector this technology has delivered no financial return to corporate America,” Slok wrote.

Why AI is not increasing profits

One might assume that companies in other industries are simply lagging behind the tech giants and will eventually also begin to see tangible benefits from AI. However, Slok is skeptical. In his view, businesses will find it difficult to turn increasingly accessible intelligence into faster revenue growth and higher profits.

The economist believes that AI’s ability to process information and solve specific tasks does not in itself guarantee better business results. An important role is played by factors that are difficult to reduce to computation and data analysis.

“AI may be an excellent calculator, but in business, intelligence is above all the ability to exercise judgment,” Slok notes.

According to him, AI does not understand responsibility, trust, corporate culture, unwritten rules, ethical trade-offs, and principles of fairness. Yet these are precisely the factors that affect companies’ reputational risks and, ultimately, revenue growth and profitability.

The impact of AI adoption still remains to be proven

Slok’s conclusions are consistent with the results of other studies, according to which the widespread adoption of AI has so far not led to significant growth in labor productivity. Companies are actively implementing new tools, but this does not always translate into a measurable economic effect.

At the same time, the absence of noticeable changes in financial indicators does not mean that AI is useless or incapable of improving the efficiency of individual processes. The result may depend on exactly how companies integrate the technology into their operations and whether they are able to restructure business processes to take advantage of its capabilities.

The key question is whether businesses will be able to turn the growing accessibility of intelligent tools into sustained growth in revenue and profits. So far, data from the largest U.S. companies outside the technology sector do not provide convincing grounds to conclude that this has already happened.