When Amazon founder Jeff Bezos agreed that AI is in an ‘industrial bubble’ with investors who …

Amazon founder Jeff Bezos has once again cautioned that artificial intelligence is presently an ‘industrial bubble’, even he insisted that the technology itself is real and will ultimately deliver huge amounts of benefits to the society. Recently, speaking at the Italian Tech Week alongside Exor CEO John Elkann, Bezos said that the excitement around AI has led to unusual investor behaviour, with billions of dollars flowing into companies regardless strong fundamentals.Bezos explained that bubbles are characterised by inflated stock prices and a rush of funding into both good and bad ideas. This makes it difficult for the investor to distinguish.Bezos further outlined the hallmarks of bubbles. He said that the current AI climate as one where “every experiment or idea gets funded,” even if the fundamentals are weak. He pointed to unusual behavior such as small companies with only a handful of employees receiving billions of dollars in investment. This, he said, is a hallmark of industrial bubbles, where excitement drives capital into ventures indiscriminately.

‘AI is for real’

Despite this caution, Bezos feels that the technology itself is genuine and transformative. “AI is real, and it is going to change every industry,” he told the audience. He further compared the situation to the biotech bubble of the 1990s, which witnessed many companies fail but ultimately produced some life-saving drugs. Industrial bubbles, he argued, are not necessarily harmful; when the dust settles, society benefits from the inventions that survive.

Investor concerns beyond Jeff Bezos

Bezos’ remarks echo a growing chorus of warnings from business leaders. Sam Altman, CEO of OpenAI, has previously said the AI market is in a bubble. At the same event in Turin, Goldman Sachs CEO David Solomon cautioned that investor excitement often overlooks risks, predicting a “reset” or “drawdown” in valuations. Similarly, Karim Moussalem, chief investment officer at Selwood Asset Management, recently said the AI trade is beginning to resemble “one of the great speculative manias of market history.”