Goldman Sachs Executive Warns of Caution in Artificial Intelligence Investments

Speaking at The Information's WTF Summit, Goldman Sachs Investment Banking Co-Head Kim Posnett stated that investors are shifting toward a more cautious approach in the artificial intelligence market due to rising capital costs.

Kim Posnett stated that while she generally believes in artificial intelligence, if high interest rates persist for a long time, artificial intelligence projects might fail to deliver expected returns. Arguing that artificial intelligence is not a bubble on its own, Posnett noted, however, that there is a possibility of a bubble forming in certain specific segments within the sector.

It was noted that investors are beginning to pivot toward vertically integrated companies that produce frontier models, software, and artificial intelligence chips during this process. On the other hand, it was also conveyed that tech giants financing their own suppliers and customers strengthens partnerships while carrying certain risks.