AI Companies Lose $190 Billion After Dismal Financial Reports
stopthatgirl7@kbin.social to 
futurism.com
Reuters reports that AI-related companies lost $190 billion in stock market value on Tuesday following disappointing earnings reports.
stopthatgirl7@kbin.social to
Thank god the bubbles finally starting to burst. I am tired of hearing about ‘AI’.
Right??? I swear every damn app is trying to shoehorn in some sort of AI nonsense just to hop on the bandwagon.
A lot of them aren't actually implementing anything, they're just changing words on their product description.
Like a spell checking addon suddenly rebranding itself as "AI".
From the very start of all this, it never made sense to call any of this "artificial intelligence", but that marketing stuck, and now we're trying to retroactively apply it to very basic things like text suggestion, further diluting the meaning of the term.
I agree with the first part of your comment, AI is the new buzzword.
But AI is the correct term for LLMs and other technologies using neural networks. That's what computer scientists have been calling them for decades. The sentient AI concept that we have comes from SciFi. I'd argue that the correct term is what experts have been calling it for years.
This misses the fact that even the experts have been using “AI” to refer to whatever technology used to seem impossible, until it becomes commonplace. Before LLMs there were heuristic algorithms, and then expert systems, and then intelligent agents and then deep learning. As the boundaries of what is deemed achievable expand, the definition of AI moves to just beyond the frontier.
You're not going to stop hearing about AI. Perhaps AI companies won't be so high-profile, but AI itself is being integrated into lots of things and it's not going to go away. The only thing that's happened here is that it's proving to be not quite so profitable as expected being an AI-specific company.
Edit: Perhaps not even that, the article appears to be neglecting to mention that this is part of a trend across the whole stock market rather than something AI-specific.
Nobody thinks generative ai will die, but when the bubble bursts maybe we wont get it shoehorned into places it really doesn't belong.
Personally I cheer for employees such as myself. The artificial pressure to compete with LLMs just got a lot softer.
AI isn't new. Algorithms "are" ai. All apps always used it. But it's changed from algorithms to AI.
AI is just a specific subset of algorithms, also not that new - first concept are from 1960 or so (from memory don't quote me) with perceptron. New is parallel computing power of modern chips - that allows for far better performance.
Absolutely is. It's fucking outstanding how big corps are eating it up.
Alrogithm corp = nothing new, boring low evaluation
Change it's name to:
AI corp= 1 BILLION DOLLARS!
I don't see it where it's part of a broader stock market trend. Sp500 is up 1.25% today, 1.52% for the past 5 days, and 4.74% for the last month. Those are spectacular numbers (for people with stock market portfolios).
AI crashing in its own little corner is fine by me.
I don't think that's necessarily true. We aren't hearing about "blockchain," "crypto," or "NFTs" every day anymore either even though they all still exist.
The current state of AI development is going to cost a ton of money until its maturity. Any company that is in “AI” right now is either intentionally spending billions of dollars to solve AGI, which will ultimately open up trillions in marketplace solutions, or is using the press to market fledgling AI “solutions” or “integrations” with fancier versions of narrow AI.
AGI is in its infancy and is progressing on an exponential curve. The first time anyone heard of ChatGPT was 14 months ago and , with proper prompting, it’s already easy to use to write college level essays and is passing higher education tests like SAT, GRE, medical exams, CPA certifications, and the bar. Think of what will happen when it hits its toddler stage, let alone adolescence or maturity.
Any way you look at it, the days of hearing about AI are just starting and it will dominate the press in the next decade.
Lol, no, that's another field entirely. They make the tools an AGI could use someday.
LLMs don't really fall under AGI, they're still static statistical models. Some RL algorithms might be on the track of AGI, but I'm not sure about that.
or we might be failing to understand severe limitations with this model which would ultimately reach its ceiling very short of anything that can reason
Of course its a hype right now. But at the same time AI improved my daily working live in the past year so much! I can outsource a lot of annoying tasks to AI and focus on the more creative tasks and everything strategic.
Can you expand on how AI improved your workflow? The only positive experience I've had with AI has been Githib's copilot in my VS Code instance. All the other ai interactions I have are pretty terrible.
Githubs Copilot
ChatGPT for larger coding tasks (its better at explaining what it does)
Deepl.com/write for proofreading and better texts.
That's a weird take given the actual numbers and relative results per company, but ok.
Microsoft's price didn't change much at all and is still trading at a 35 P/E ratio (17% higher than Apple's) despite being neck and neck in the race for the largest company in the market and allegedly not having its AI efforts actually change product usage. Clearly the market is still pricing it as if it's going to grow more somehow.
AMD is down, but since when is AMD an "AI company"? That's Nvidia through and through, who is still double digit percentage points up from a month ago, and trading at a 81 P/E ratio. The market losing faith in Nvidia's competition seems more like the opposite of this headline, given it's the key area where Nvidia has a market advantage over AMD.
Google, whose revenue is 90% ads, is down in response to falling short on ad sales. Which if anything may be a result of increased chatbot usage reducing search volume and Google's chat offering being the Bing of AI chatbots.
This is clickbait analysis.
Are you ignoring Github Copilot?
Microsoft's performance was actually strongest in their Azure services in their earnings report, and I can't think of any AI products tied directly to that part of their business
Although to be fair, their big push now is baking copilot directly into Windows 12, so it would be fair to think their long term outlook is tied to that service
Didn't they already bake it into 11? I'm not caught up with 12 having only recently gotten 11 but dang.
What a clickbait "article". The whole stock market is correcting insane growth of last year and in fact the company with the biggest AI investments (Microsoft) crashed the least!
It's rewording the real article from Reuters: https://www.reuters.com/technology/ai-companies-lose-190-billion-market-cap-after-alphabet-microsoft-report-2024-01-31/
Swelling, more like
It's not a toomah!
All scams come to an end when they run out of marks to steal from.
Look at the reuters article cited: https://www.reuters.com/technology/ai-companies-lose-190-billion-market-cap-after-alphabet-microsoft-report-2024-01-31/
I don't know that I would say this has anything inherently to do with AI...
The reuters article for AMD specifically: https://www.reuters.com/technology/high-flying-chipmakers-hit-after-amds-forecast-falls-short-2024-01-31/
Maybe they should try making products that work instead of trying to shove ads down our throats? How's that for a business model: give the customer what they want?
Many of their customers want them to produce ads.
Fair - but I would hope for a functional product supported by delivery of ads, rather than ads that exist for the purpose of ads so that there can be more ads delivered along with the ads (oh yeah, and somewhere in there, a product... which itself is little more than merely another thinly-disguised advertisement).
Google is the perfect example: it made its name bc it WORKED, then it started to be supported by ads - okay fine so far - then the ads took over and now very often, it merely passes on SEO "ads" (except crucially: remember that was supposed to be the product) rather than show actual results. Plus on top of that, it also shows the ads. The latter are fine but the former are most definitely not, especially when it pushes out real results so that like even on page 5 you can't find what you were looking for, which might still be the very top result of DuckDuckGo hence cannot be that hard to produce. It exemplifies the process of enshittification for us all.
Those products exist. There are plenty of AI products that don't involve ads at all, you pay for a service that uses AI to help do whatever it is the service is about (for example GitHub Copilot). There are open source products that give you those services for free, even.
Some people use those services to create advertising, but it's not like advertising is the only field that this stuff is useful for.
Believe it or not, but at one point Google (and similarly many of the products that it owns now, like YouTube) did not have ads in them either...
I am okay with adding ads to them though, to help support future product development. And likewise contributing packages delivered as open source, ofc I am happy with that.
I just do not like watching products, like Google search, lose out on services, not b/c of traditional ads but rather the newer style of ads in the form of SEO, i.e. not "ads" so much as "misinformation", which Google made far too easy to game the system with as compared to the previous incarnation, where it was based more on "reputation" e.g. linking to & from other sites. Though similar to ads in that it is a way for companies to promote themselves, jumping straight to the front of the line rather than play "fair".
Nowadays you can zoom in on Google maps and not see the store you are looking for until you are practically on top of it or manage to click it directly - instead Google prioritizes what it wants to show you, based on who ponies up what amount of dough to Google, rather than what you as the customer want to see.
And as for AI, it simply was not ready. It was itself an advertisement to executives from people trying to sell it before having made a viable product yet. Thus I am not surprised that they lost billions due to mismanagement of this highly interesting and promising field, that will eventually offer everyone a great deal, one day.
They're doing just that, alright.
But people buying the products are not the customers of these big publicly traded companies.
That's the same reason that the Windows OS sucks so bad: the "customer" is the companies paying for licenses, not individuals wanting things to "just work" without an entire IT department at their backs.
Although I would guess that even stockholders would not like the fact that these companies lost billions of dollars.:-|
The companies didn't lose that money. Their investors didn't even lose that money. A number went down temporarily, that's all.
I remember YouTube videos or podcasts where presenters said that we'd have very advanced AI by GPT-5 and singularity is just around the corner. Marketing stuff of these companies pushing language models made us all fools (including me). Now finances are catching up to all this bullshit.
The same thing was said about self-driving. I recall arguing with people on reddit back in like 2018 who called me an idiot because I didn't believe we'd have full autonomous driving within the next few years. I swear these people jump from one fad to the next and dive into each one head first.
Uh yes, they do. It's the same group of people falling for this stuff over and over. Crypto, NFTs, Self Driving, AI now. What's important to them is being able to point at this stuff and make a wojack face
If / then / switch / while
All of these are examples of what executives are calling AI there are many scams its hilarious.
Grifters gunna grift they face no clawbacks from lying to investors.
“AI Winter is coming”
-Ned Stark
I’ll never forgive D&D for what they did to that show. It was omnipresent in public consciousness for like a decade, and they fucked the last couple seasons so badly it’s now all but forgotten. It’s almost impressive in a depressing kind of way.
Oh we try to forget...
I was a huge fan. Watched it from season one on. Even had a House Stark banner. Now I don’t even think about it unless I see it mentioned on social media. Married with Children and Aqua Teen Hunger Force spontaneously pop into my mind 10 times more often than Game of Thrones.
Tbf, I don't think we as a society think about Aqua Teen Hunger Force nearly enough.
That nice lady is in the Beacon 23 show.
Shame.
Does that have anything to do with the IP power grab that is apparently under way? I've seen the propaganda and the mood seems to be that AI should be monopolized by the few super rich.
I thought the mood was that everything should be monopolized by the super rich.
If the last 40 years has taught us anything, it's that the time is always right to short ai companies
Artificial Intelligence at this stage is Artificial Ignorance. It's not ready to be unleashed onto anyone who blindly trusts anything they read.
Listening to Peter talk about GPT as if it was an all comprehending oracle when he was interviewed on Hannah Reloaded was unsettling, because I know he's not alone in thinking it's (paraphrased) "a pattern detecting intelligence, that can see things we can't" my brother in Christ it is a better Markov chain engine.
lol rekt
based
23 skidoo
ChatGPT says:
Investing in AI, like any other sector, carries risks that could potentially lead to financial challenges or even bankruptcy for companies. Some factors include:
High Initial Costs: Developing AI technologies often requires significant upfront investments in research, development, and infrastructure. If these costs are not managed well or if the technology doesn't gain traction, it can strain a company's financial resources.
Market Uncertainty: The AI market is rapidly evolving, and success depends on staying ahead of technological advancements. If a company fails to adapt or faces competition with superior innovations, it may struggle to maintain market relevance.
Regulatory Challenges: The AI industry is subject to evolving regulations, and changes in legal frameworks can impact operations. Non-compliance or unexpected regulatory hurdles can lead to financial setbacks.
Cybersecurity Risks: As AI systems become more integrated into various sectors, the risk of cyber threats increases. A significant cybersecurity breach could result in financial losses, reputational damage, and legal consequences.
Limited Adoption: If the adoption of AI technologies is slower than anticipated, companies heavily invested in AI may struggle to generate expected returns on their investments, potentially leading to financial distress.
It's important to note that while AI presents significant opportunities, prudent management, market understanding, and strategic planning are crucial to mitigate risks associated with investing in this dynamic and evolving field.
The irony of using ChatGPT for this of all articles.
Yeah, just goes to show that the AI hype may be peaking, it's not going away.
This is the best summary I could come up with:
Following disappointing quarterly earnings results by Microsoft and Google owner Alphabet, Reuters reports that AI-related companies lost a whopping $190 billion in stock market value.
Microsoft may have eked out a win, with the promise of AI services convincing investors, but even its stock dropped by 0.7 percent in extended trade, per the report.
Google's parent company fared much worse, dropping 5.6 percent after missing ad revenue expectations.
Microsoft beat Apple by becoming a $3 trillion company earlier this month, a massive vote of confidence for its doubling down on the tech.
According to Deutsche Bank strategist Jim Reid, the downturn may be "signaling some overextension of the recent strong rally," according to a note seen by Yahoo Finance.
"This knee-jerk reaction [to tech results] is noise, the AI revolution has started," Wedbush analyst Dan Ives told Yahoo Finance.
The original article contains 331 words, the summary contains 139 words. Saved 58%. I'm a bot and I'm open source!
it's "AI" not AI...
The term "artificial intelligence" has been in use in this field for a very long time now, applying to a broad range of techniques. Some of them much, much more primitive than the LLMs and such that are revolutionizing the field currently. There is nothing wrong with using AI to refer to them.
It's AI not AGI
It's A "I," not "AI"
no, it's quite literally AI. It's a research field in IT that is quite old.
Or are you ranting for years already that the AI that computer games use is also not really AI? Because they do that for decades as well.
People like you are really starting to be a problem, as they water down the discussion of real problems this topic has by blabbering on about "iTs nOt ReAl Ai". Stop it. It's not productive. Concentrate on the real problems instead of doing armchair bullshit like this
Yeah, AI is pretty generic: simple pathing algorithms in games are called AI.
The "AI" being hyped a lot at the moment falls in the subgroup called Machine Learning (or ML) for short, which excludes algorithms (so something like the A* pathing algorithm is AI but not ML) and isn't even all that young (I learned Neural Networks back at Uni about 3 decades ago).
It's just that computing power, the advances over time in the algorithms in Neural Networks and the use of massive datasets (LLM stands for Large Language Model) have brought us over a threshold were ML can produce output in text, imagery and audio good enough to usually deceive the average person, hence all the hype which is being backfitted to hype just about all kinds of AI, even the algorithmic stuff.
I mean I was kinda just riffing on the pattern cause I thought it was funny.