Bill Gates cautioned that the current wave of artificial intelligence investments may not lift all players, describing the AI sector as “hyper competitive” and warning that some companies’ sky-high valuations will inevitably fall.
Speaking to CNBC’s Tania Bryer at Abu Dhabi Finance Week, the Microsoft cofounder said, “AI is the most important thing going on. Does it mean all of these companies with high valuations will be winners? No, it’s going to be hyper competitive.”
He added, “AI is only a bubble in the sense that not all of these valuations will end up going up. Some of them will go down. But it’s a deeply profound technology that will reshape the world — there’s not the slightest doubt about that.”
AI-related stocks such as Palantir and Tesla currently trade at price-to-earnings ratios above 200, far exceeding the S&P 500 average of about 25, fueling concerns of overvaluation. Global markets dipped in November as investors began to question whether the AI boom could turn into a bubble.
Still, Gates said AI’s transformative potential remains undeniable. “This technology will bring huge benefits in health, education, and agriculture,” he said, highlighting how AI tools like virtual doctors and farm advisors could improve productivity across Africa.
The interview followed a $1.9 billion pledge from the Gates Foundation and global leaders to eradicate polio and strengthen public health systems. Gates said 2026 would be “a big year for global health,” as AI begins to play a greater role in delivering vaccines and boosting agricultural output.
“Is this profound and real? Absolutely,” Gates concluded. “Nobody should have any doubt about that.”
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