The AI investment frenzy is cooling down. After explosive growth in AI-related stocks and investments until 2025, 2026 has seen a sharp correction. Overhyped expectations are clashing with reality, and the market is now taking a cold, hard look at the actual value of AI.
According to a CNBC report, fears that AI could replace existing SaaS companies have rocked software stocks. Some analysts are calling it ‘irrational panic,’ but several SaaS companies have actually seen double-digit stock price declines. Concerns are growing that AI tools could shake up the very structure of the existing software market. Meanwhile, Yahoo Finance says that if AI ‘took investors on a date’ in 2025, then 2026 is ‘time to foot the bill.’ It means the time has come to prove it with actual profits. The valuations of AI startups have been excessively high compared to their performance, and companies that fail to close this gap will inevitably be weeded out.
TechCrunch predicts that 2026 will be the year AI transitions ‘from hype to pragmatism.’ The analysis is that actual business models and revenue generation capabilities will become the core criteria for evaluating companies, rather than unconditional investment. Large tech companies are also revising their strategies to reduce or streamline AI infrastructure investments. The bursting of the bubble is painful, but it is likely to result in a healthy restructuring where only the most capable companies survive.
The correction in the AI investment market is an inevitable process. There is no need to panic over short-term declines, but the era of receiving high valuations simply for being ‘AI’ is over. Focusing on companies and technologies that create real value will be a wise strategy. I hope this article is helpful in making investment decisions.
FAQ
Q: Is the AI investment bubble really collapsing?
A: Rather than a complete collapse, it’s more of a correction in an overheated market. It’s more accurate to see it as a stage where unsubstantiated overvaluation is being cleared away, and the market is being reorganized around capable companies.
Q: Are SaaS companies in danger because of AI?
A: AI can replace some SaaS functions, but not all SaaS will disappear. Companies that actively adopt AI to enhance their services may actually become more competitive.
Q: Is it okay to invest in AI-related stocks now?
A: It is risky to invest simply because of the AI theme. It is important to select companies with solid actual sales and revenue structures, and it is advisable to approach it from a long-term perspective.