BiggerPockets Money Podcast · Tuesday, September 15, 2026
Aswath Damodaran expresses caution regarding the profitability of AI products and services, noting that current optimistic revenue estimates of $250 billion over four months might not justify the over $2 trillion invested in AI infrastructure. He suggests that revenues would need to reach $8-10 trillion to validate the upfront capital expenditure.
“Collectively, even the best case estimates of the products and services that come out of AI right now, the revenues from those products and services, even the most optimistic numbers, was about 250 billion over the last four months.”
“If revenues level off at 250 billion, that two trillion is almost entirely going to be written off. Your revenues will have to climb from 250 billion to a much, much, much higher number. How much higher? Well, it depends on what kind of margins and profits you can make. So let's say there's a steady state 10 years from now, 15 years from now. The AI business is well established. We're looking at the collective revenues from that business. You're asking, how much would those revenues need to be to justify the two trillion invested upfront? The revenues will have to be maybe eight, 10 trillion because if you think about the profits and the expenses produced, the revenues and the profits, and the tax on the profits, you're very quickly going to start to scale the latter up to 10 trillion.”