Is AI Fatigue Already Setting in for Financial Executives?

Earnings calls are seeing a slide in AI mentions.

The Financial Times offers an interesting proposition on so-called “AI fatigue.”

A February 15 article notes company executives are mentioning artificial intelligence less and less on quarterly earnings calls. According to FT, the specific terms “AI”, “Generative AI”, and “machine learning were only mentioned 198 times in US, Asia, and Europe-based conference calls during the fourth quarter, 2023. That’s down from a high of 691 mentions.

The original data comes from research by Bloomberg and Apollo Global Management. According to Apollo chief economist Torsten Slok, the AI “fatigue” trend is accelerating. Slok points to the three tech terms mentioned in 517 in the Q4, 2023 earnings season. According to Apollo, that’s way ahead of 198 mentions so far in 2024.

Both numbers, however, are significantly larger than in the fourth quarter of 2022, when AI was only mentioned in 22 earnings calls. On November 30, 2022, Open AI released ChatGPT, which triggered a headlong consumer and business rush into generative AI tools and applications. By the first quarter of 2023, “artificial intelligence” earnings call mentions skyrocketed to 268, Slok noted.

It’s been largely downhill ever since.

“The positive effects of technology continue to support firms, consumers, and economic growth,” Slok told Yahoo Finance last week. “The question is if AI is anything special. So far, AI is not a revolution but a continuation of the tech trend that started in the 1990s.”

AI Becoming “Normalized”

The Apollo data notes that more companies continue to mention terms like “artificial intelligence” or “Gen AI” in conference calls but only use the terms once or twice during earnings briefings. A separate Goldman Sachs Investment Research study noted “the breadth” of S&P 500 companies mentioning AI is still up 36%; it’s just that the terms aren’t used as often as they once were on earnings calls.

Is that a signal company execs are getting weary of AI? Probably not, Slok noted. It’s really a sign that AI is being normalized and there are other issues like the economy, public policy, supply chains, and staffing numbers to talk about.

Plus, the fourth quarter earnings season isn’t over, with just 383 S&P companies out of 500 reporting earnings.

Given those considerations, AI may still be a dominant talking point on earnings – only not as dominant as it was a year ago.

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