Jim Covello has been saying the quiet part out loud about AI investing for two years now. The difference is that in 2024, the market mostly shrugged. In June 2026, with over $1 trillion in planned AI-related capital expenditures on the books and profitability still largely theoretical, the shrugging has gotten a lot harder to justify.
Covello, Goldman Sachs’ head of Global Equity Research, used a recent podcast appearance to lay out what he sees as a widening disconnect between what companies are spending on AI and what they’re getting back. His assessment was blunt: the economics of AI are “more questionable today than two years ago.”
The trillion-dollar question nobody wants to answer
Goldman Sachs has noted over $1 trillion in planned AI-related capex. And yet, as Covello points out, the buyers and developers pouring money into AI infrastructure have yet to establish clear profitability from those investments.
Covello distilled his concern into a single line:
