Allianz chief economic adviser Mohamed El-Erian sees growing differences among AI companies as positive after an initial wave of broad investment, with earnings and balance sheets helping identify firms that may endure.
El-Erian made the remarks in a CNBC Squawk Box interview on Oct. 26. “It’s a good thing that we’re seeing differentiation,” he said. He said a company’s earnings outlook and financial footing will factor into its ability to last as the market develops.
He also expects tighter monetary conditions to affect housing and consumer credit more than large technology companies.
For AI to produce broader productivity gains, El-Erian said, progress is needed in frontier innovation, wider adoption and effective risk mitigation. He said innovation at the frontier was the only one of those areas progressing well.
A McKinsey survey cited in EconoTimes’ earlier coverage of AI adoption and earnings found that 44% of respondents said their organizations were scaling AI across the enterprise, while 37% credited AI with a positive effect on earnings before interest and taxes.
