The narrative of bubble from Altman coincides with some rhetoric around concerns about excess spending in AI space from some experts and analysts. Alibaba co-founder Joe Tsai, Bridgewater Associates’ Ray Dalio and Apollo Global Management chief economist Torsten Slok had all raised similar warnings. Last month, Slok stated in a report that he believed the AI bubble of today was, in fact, bigger than the internet bubble, with the top 10 companies in the S&P 500 more overvalued than they were in the 1990s.

But some investment professionals do not buy this sort of argument, indicating that the risks related bubble will be company-dependent. They believe that from the perspective of broader investment in AI and semiconductors, the narrative of bubble is not reasonable. The fundamentals across the supply chain remain strong, and the long-term trajectory of the AI trend supports continued investment. But there is an increasing amount of speculative capital chasing companies with weaker fundamentals and only perceived potential, which could create pockets of overvaluation.

Seemingly there is some noise around AI space at this point. Are we in a phase where investors as a whole are overexcited about AI? Is AI the most important thing to happen in a long term horizon? Do the returns of massive spending in AI space from Mega techs are supportive, or in another words, whether the returns of AI spending are good enough to justify the current multiple of Mega techs? These are the most important metrics investors should keep close eye on to judge and assess if we are in an AI bubble phase accurately.

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