Is the AI Winter Finally Upon Us?
The tepid reception of GPT-5 and the selloff of CoreWeave could be an inflection point — or a bump in the road.
Open AI CEO Sam Altman has had to backpedal a bit.
Photographer: Justin Sullivan/Getty Images
I wrote at the beginning of the year that Wall Street investors should brace for an “AI winter” in 2025; not necessarily a slowdown in investment, and certainly not in hype from the companies, but in tangible progress. Patience would be tested. Some recent events warrant revisiting the question: Is the AI winter upon us?
GPT-5, the long-awaited new model from Sam Altman’s OpenAI, was released earlier this month to a tepid reception. If it’s a step toward artificial general intelligence, as the company repeatedly said it would be, it’s a tiny one indeed. The model was so poorly received by some ChatGPT die-hards that the company was forced into an embarrassing rollback, making older models available again. Altman’s claim that GPT-5 was like talking to a “PhD-level” expert quickly became a joke.
At the same time, CoreWeave Inc., one of the few pure-play AI stocks, plummeted more than 25% last week after guidance that spooked investors: Revenue growth is expected to be enormously outpaced by capital expenditure increases. (And the IPO lockup was coming to an end, which didn’t help either.)
And while it’s hard to pin down just how beneficial AI has been, or will be, in the business world, one piece of research from McKinsey & Company should give everyone pause. While eight of out 10 companies surveyed said they were implementing generative AI in their business, the consultancy group observed, just as many said there had been “no significant bottom-line impact.”