Companies have poured enormous sums into artificial intelligence. So where is the payoff? According to Apollo Global Management’s chief economist, Torsten Slok, the honest answer for most of corporate America is: not yet.

In a note published on October 24 titled “No Signs of AI Payoff Outside the Tech Sector“, Slok argued that AI has so far delivered zero financial payoff to companies outside of tech. TechCrunch picked up the analysis on October 25, and it has since become one of the most discussed takes in the ongoing debate about whether AI spending is paying off.

This article is for general information only and is not investment advice.

What the data shows

Slok’s analysis splits the S&P 500 into two groups. The first is the “Magnificent Seven”, the giant tech companies Alphabet, Amazon, Apple, Meta, Microsoft, Nvidia and Tesla. The second is everyone else, often called the S&P 493.

According to Slok, revenue per worker and profit margins have been rising for the Magnificent Seven. For the S&P 493, those same measures have been essentially flat. In other words, the companies selling AI and the infrastructure behind it are seeing gains, while the much larger group of companies buying and using AI is not yet showing a clear improvement in its numbers.

He also found no sign yet of an AI boost in total factor productivity, a broad measure of how efficiently an economy turns workers and capital into output, based on a data series from the Federal Reserve Bank of San Francisco.

Why the payoff may be missing

Slok’s explanation comes down to how companies are treating AI. According to his note, much of corporate America still treats spending on AI tokens, the units AI models use to process and bill text, as a cost centre rather than a source of new revenue. With no impact on the bottom line, he writes, mainstream corporate America is starting to pull back. Venture-backed companies keep spending more on tokens, but he argues that mainstream corporate America “does not need the latest model and is unwilling to pay for it.”

His most quoted line sums up the argument: “AI may be a great calculator, but in business, intelligence is mostly judgment.” He added that AI “does not understand accountability, trust, culture, unwritten rules, ethical trade-offs or fairness,” all of which shape revenue and margins. In other words, AI can speed up tasks, but turning that speed into profit depends on decisions that are still very human, such as what to build, what to cut and how to reorganise work.

His conclusion is that the real test of AI lies outside the tech giants: “The AI story will be decided in the S&P 493.”

The other side of the argument

Not everyone reads the situation the same way. Supporters of AI argue that big technology shifts often take years to show up in productivity statistics, because companies need time to redesign processes, retrain staff and rethink how teams are organised.

Others argue that the biggest gains may come from changes that take time, such as reorganising teams, redesigning workflows or changing how many projects one manager can oversee. Changes like that would not appear overnight in revenue-per-worker figures.

There is also a timing question. Slok’s note is a snapshot. If companies are still experimenting, the payoff could arrive later, or it could stay concentrated among the firms selling AI. The data does not settle that debate yet.

What it means for businesses

For business owners and managers, the takeaway is not that AI is useless. It is that buying AI tools is not the same as getting results from them. A few practical lessons stand out:

  • **Start with a business problem, not a tool.** Pick a process with a clear cost or bottleneck and measure it before and after.
  • **Track outcomes, not usage.** The number of prompts or tokens used says little. Time saved, errors reduced or customers served says much more.
  • **Invest in people.** If intelligence in business is “mostly judgment”, then training staff to use AI well matters as much as the software itself.
  • **Be patient but honest.** Give projects time, but be willing to stop those that are not delivering.

The bottom line

Apollo’s chief economist has put a sharp question on the table: if AI is transforming business, why are most companies’ numbers not showing it yet? The tech giants are clearly benefiting. Whether everyone else follows will depend less on the technology itself and more on how well companies learn to use it.

Image: New York Stock Exchange Entrance by Balon Greyjoy via Wikimedia Commons, CC0 1.0