AI May Not Be Worth The Cost — Here’s Why

In 2025, nearly 50,000 workers have been laid off in the name of AI, and yet a growing number of companies are quietly discovering that the technology costs more than the humans it was supposed to replace. Uber blew through its entire 2026 AI budget in four months. Microsoft is cancelling AI licenses across divisions. One Nvidia executive said the cost of compute is now "far beyond the cost of employees." This is the central tension of the current moment: the AI industry is preparing to launch the three largest IPOs in history — SpaceX, OpenAI, and Anthropic, with a combined valuation of roughly $4 trillion — just as the customers paying for all that compute are starting to ask whether it's worth it.

The IPO mania and what's different this time

The last time the IPO market looked like this was 1999, and the comparison is both instructive and misleading. Then, the NASDAQ lost 70% of its value over two years. Then, companies like TheGlobe.com went up eightfold on their IPO day with no profits to speak of. Then, Google was still a PhD project, Amazon was a money-losing book company, and Yahoo was the most important media company in the world.