Apollo Chief Economist Torsten Slok: AI Benefits Concentrated in the Magnificent Seven; Other Industries See Only Costs, No Returns
Torsten Slok, chief economist at Apollo Global Management, a US asset management firm, analyzes that despite massive AI investment, profit margins and revenue per employee for US companies outside the tech sector have hardly changed, while token spending is shifting from a growth driver to a cost burden. He argues that AI excels at computation but not judgment, and commercial value ultimately depends on handling context, trust, and accountability.
Torsten Slok, chief economist at Apollo Global Management, a major US asset management and financial investment firm, recently released an analysis with the core conclusion that despite huge AI investments and high market enthusiasm, this technology has not yet delivered any measurable financial benefits to US companies outside the tech industry.
Slok’s research framework focuses on the S&P 493 index, which deliberately excludes the "Magnificent Seven" (including Tesla, Microsoft, Nvidia, Apple, Meta, etc.). His data shows that since early 2023, revenue per employee among the Magnificent Seven has risen significantly, with profit margins climbing from around 10% in 2020 to approximately 30%. In contrast, other industries within the S&P 493 have seen their profit margins and revenue per employee remain largely unchanged, aside from minor fluctuations.
Slok explains the mechanism as follows: when AI expenditures do not appear on income statements, the business community is re-evaluating the nature of these investments. In his report for Apollo, he wrote that US businesses are reclassifying token spending from a source of growth to a cost burden. This assessment aligns with a survey by Bitkom, the German Information Technology Association, where about one-third of responding German companies reported being caught off guard by high AI costs.