The AI market is tipped to splinter in 2026.
The last three months of 2025 were a rollercoaster of tech sell-offs and rallies, as circular deals, debt issuances, and high valuations fueled concerns over an AI bubble.
Such volatility may be an early sign of how AI investment is set to evolve as investors pay closer attention to who is spending money and who is making it, according to Stephen Yiu, chief investment officer at Blue Whale Growth Fund.
Investors, especially retail investors who are exposed to AI through ETFs, typically have not differentiated between companies with a product but no business model, those burning cash to fund AI infrastructure, or those on the receiving end of AI spending, Yiu told CNBC.
So far, “every company seems to be winning,” but AI is in its early innings, he said. “It’s very important to differentiate” between different types of companies, which is “what the market might start to do,” Yiu added.
