JPMorgan Vice Chairman Says AI Valuations Are Too High

JPMorgan Vice Chairman Daniel Pinto said at a financial leaders summit hosted by the Hong Kong Monetary Authority that AI valuations are still too high, and he expects a correction in the industry.

Pinto believes productivity will see a major boost and AI will have a big impact, but the pace of growth needs careful attention. Someone eventually has to pay for all the AI products being developed. Industries outside AI must pay trillions of dollars to these companies to justify the investments. Market expectations for revenue and profit growth may be too steep compared to current prices, which could lead to a repricing of the whole sector.

JPMorgan Asset Management strategist David Lebovitz said earlier that investors are getting better at telling apart AI risks and rewards, judging which parts of the industry chain may face oversupply and which still have strong demand, instead of blindly buying anything AI-related.