Investors can add the fallout from a Massachusetts Institute of Technology study on what's pressuring artificial stocks. AI stocks, including Palantir Technologies and Nvidia, tumbled again on Wednesday as the Nasdaq composite retreated.
"There has been sizable investor interest on the takeaways from MIT's "The GenAI Divide: State of AI in Business 2025," said Evercore ISI analyst Amit Daryanani in a report. He added: "The report's central finding underscores that 95% of generative AI pilots have produced no measurable impact for enterprises. The report further notes that genAI deployments at an enterprise level are not yet generating adequate return on investment."
The MIT report draws on a survey of 300 public enterprise AI deployments, 150 leader interviews, and 350 employee responses. The study attributes most failures not to AI quality, but to a "learning gap" — organizations failing to adapt systems, processes and cultures around AI tools.
Palantir stock fell 3.6% to near 152 in midday trading on Wednesday, while Nvidia stock dipped over 1% to 173.48. With Wednesday's retreat, Palantir stock is down about 20% from its all-time high of 190 on Aug. 12..
CoreWeave, Oracle, Arista Networks and Credo Technology also fell on Wednesday as the Nasdaq retreated.
In one development for AI stocks, the chief executive of well-funded, fast-growing startup OpenAI on Monday said the AI "bubble" could soon burst.
"Are we in a phase where investors as a whole are overexcited about AI?" said OpenAI CEO Sam Altman. "My opinion is yes."
AI Stocks: Software Hit
There's growing investor angst over the "per seat" licensing business models of some software companies if artificial intelligence results in the elimination of jobs. Companies adopting AI tools aim for productivity gains. But if AI means fewer staffers, that could result in fewer people using software, according to the bearish view.
But Evercore's Daryanani sees an opportunity for some tech companies. "The MIT report highlights the barriers to scaling AI within enterprises and reinforces the critical role of IT services/infrastructure vendors in alleviating bottlenecks and enabling meaningful return on investment from genAI adoption," he said.
Follow Reinhardt Krause on X, formerly Twitter, @reinhardtk_tech for updates on artificial intelligence, cybersecurity and cloud computing.
