When Nvidia delivered yet another blockbuster earnings report this week – $46.73 billion in second-quarter revenue, a 56 per cent increase from a year earlier, slightly above analyst expectations – it looked like a victory lap for the poster child of the artificial intelligence boom.
With its shares up 35 per cent this year, making it the first company to breach a $4 trillion market capitalisation, the US-based chip maker has smashed earnings expectations repeatedly.
But markets, already nervous about the stretched valuations of companies linked to AI, were less convinced. Nvidia’s shares slipped about 2 per cent in early Thursday trading, as uncertainty over its sales in China – amid rising tensions between Washington and Beijing – clouded its growth outlook.
But part of the market anxiety stems from a deeper concern: despite the hundreds of billions of dollars being poured into AI, there is a creeping suspicion it may not yet be delivering real business value.
That suspicion was given further weight by a Massachusetts Institute of Technology report that claimed last week that 95 per cent of organisations have not yet seen any payoff from their investments in generative AI. No boost in productivity. No revenue gains. Not even a noticeable dent in the bottom line.
So where is the disconnect? Why are some companies pouring vast sums into AI infrastructure – Nvidia’s biggest customers, Microsoft, Google, Meta and Amazon are on track to spend $350 billion this year – while so few see meaningful gains?
The uncomfortable truth is that many businesses do not know what they are doing with AI. Too often, tools are used haphazardly – bolted on to legacy IT systems or confined to a handful of specialists – with efforts aimed at small gains in individual productivity, rather than improving how the whole organisation runs.
The result is predictable: scattered results, wasted investment and frustrated expectations.
In theory, generative AI should be transformative, driving productivity gains, cutting costs and unlocking new revenue. In practice, it rarely delivers. Yet real success is possible.
The companies seeing meaningful returns from AI today tend to share three key traits. Firstly, they democratise the technology. Not just training top executives or data scientists, but equipping rank-and-file employees with a working understanding of what AI can (and cannot) do. That means treating AI not as a mysterious force to be outsourced to technology vendors, but as a capability to be embedded across an organisation.
Secondly, successful companies define specific, high-value use cases. Not vague aspirations like “improve customer service” or “optimise the supply chain”, but tangible outcomes with dollar signs attached.
One Asian bank I advise, operating in a tightly regulated market, moved third-party models on to its own IT servers so the AI was able to work with sensitive data that could not be shared externally. It then built custom tools around these models – starting with simple applications for general staff, and later expanding to more advanced tools for bankers – while closely tracking the results at each stage.
Thirdly, the firms that thrive give AI the infrastructure it needs. This is not plug-and-play technology. It requires dedicated engineering, careful integration into existing workflows and well-defined governance frameworks to ensure it delivers real value.
You cannot just throw a large language model at a problem and hope it sticks. Companies that do so often end up with demo-friendly prototypes and no commercial payoff.
Contrast this with a pharmaceutical retailer that approached AI with surgical precision. It categorised its efforts into three clear categories: making existing processes more efficient; optimising operations using historical data; and monetising new products and services. That clarity created the conditions for real impact – and financial returns.
Sam Altman's warning of an AI bubble may be true. But the bigger threat is an AI winter
All of this stands in sharp contrast to the surge that has carried US equities to record highs in recent months, powered by investor bets on generative AI. The S&P 500 is up 9 per cent this year, while tech stocks rebounded strongly from their April lows.
But they lost ground last week, as concerns mounted over the stretched valuations of companies linked to AI. The unease deepened after Sam Altman, chief executive of OpenAI, warned that an AI bubble might be forming.
Nvidia, software group Palantir and chip maker Arm were among those caught in the sell-off, which was reinforced by the publication of the MIT report questioning business returns from generative AI. This was a sharp reminder that hype cannot outrun fundamentals forever.
Mr Altman's warning of an AI bubble may be true. But the bigger threat is an AI winter. If executives continue to overpromise and underdeliver, the shift in investor sentiment we are already seeing will only accelerate – not in a sudden crash, but in a long, quiet chill.
What companies should be doing now is recalibrating, moving past the PowerPoint phase and starting to ask tough questions. Does this AI tool fit with our systems? Can our people actually use it? And does it measurably improve something we care about?
For these companies, Nvidia’s earnings are only a weak signal of what is happening on the ground, even if the world’s most valuable public company is treated as a bellwether for the AI boom.
There is a long lag between the chips Nvidia sells and the business results its customers deliver. Its processors power the training of models such as OpenAI’s ChatGPT and Google’s Gemini – tools that then take months to be built into products and workflows.
If Nvidia ever stumbles, it will say less about what is happening in offices today and more about what could unfold six to 12 months down the line.
Which brings us back to the headlines. Are 95 per cent of companies failing with AI? Perhaps. But the failure has less to do with the technology than with how executives choose to use it.
The companies already seeing results are the ones that spread understanding of the tools across their workforce, tie projects to clear business goals – and put the right infrastructure in place to make them work.
There is no shortage of potential. What is missing is strategy. It is not about the chips companies buy from Nvidia, but what they do with them.
Amit Joshi is professor of AI, analytics and marketing strategy at IMD
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The specs
Engine: 2.0-litre 4cyl turbo
Power: 261hp at 5,500rpm
Torque: 405Nm at 1,750-3,500rpm
Transmission: 9-speed auto
Fuel consumption: 6.9L/100km
On sale: Now
Price: From Dh117,059
EPL's youngest
- Ethan Nwaneri (Arsenal)
15 years, 181 days old
- Max Dowman (Arsenal)
15 years, 235 days old
- Jeremy Monga (Leicester)
15 years, 271 days old
- Harvey Elliott (Fulham)
16 years, 30 days old
- Matthew Briggs (Fulham)
16 years, 68 days old
The%20Killer
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What sanctions would be reimposed?
Under ‘snapback’, measures imposed on Iran by the UN Security Council in six resolutions would be restored, including:
- An arms embargo
- A ban on uranium enrichment and reprocessing
- A ban on launches and other activities with ballistic missiles capable of delivering nuclear weapons, as well as ballistic missile technology transfer and technical assistance
- A targeted global asset freeze and travel ban on Iranian individuals and entities
- Authorisation for countries to inspect Iran Air Cargo and Islamic Republic of Iran Shipping Lines cargoes for banned goods
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Key facilities
- Olympic-size swimming pool with a split bulkhead for multi-use configurations, including water polo and 50m/25m training lanes
- Premier League-standard football pitch
- 400m Olympic running track
- NBA-spec basketball court with auditorium
- 600-seat auditorium
- Spaces for historical and cultural exploration
- An elevated football field that doubles as a helipad
- Specialist robotics and science laboratories
- AR and VR-enabled learning centres
- Disruption Lab and Research Centre for developing entrepreneurial skills
Killing of Qassem Suleimani
Specs
Engine: 51.5kW electric motor
Range: 400km
Power: 134bhp
Torque: 175Nm
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LA LIGA FIXTURES
Friday Athletic Bilbao v Celta Vigo (Kick-off midnight UAE)
Saturday Levante v Getafe (5pm), Sevilla v Real Madrid (7.15pm), Atletico Madrid v Real Valladolid (9.30pm), Cadiz v Barcelona (midnight)
Sunday Granada v Huesca (5pm), Osasuna v Real Betis (7.15pm), Villarreal v Elche (9.30pm), Alaves v Real Sociedad (midnight)
Monday Eibar v Valencia (midnight)
The Buckingham Murders
Starring: Kareena Kapoor Khan, Ash Tandon, Prabhleen Sandhu
Director: Hansal Mehta
Rating: 4 / 5
UPI facts
More than 2.2 million Indian tourists arrived in UAE in 2023
More than 3.5 million Indians reside in UAE
Indian tourists can make purchases in UAE using rupee accounts in India through QR-code-based UPI real-time payment systems
Indian residents in UAE can use their non-resident NRO and NRE accounts held in Indian banks linked to a UAE mobile number for UPI transactions
The specs
Engine: 0.8-litre four cylinder
Power: 70bhp
Torque: 66Nm
Transmission: four-speed manual
Price: $1,075 new in 1967, now valued at $40,000
On sale: Models from 1966 to 1970
RESULTS
2pm: Handicap (PA) Dh40,000 (Dirt) 1,000m
Winner: AF Mozhell, Saif Al Balushi (jockey), Khalifa Al Neyadi (trainer)
2.30pm: Maiden (PA) Dh40,000 (D) 2,000m
Winner: Majdi, Szczepan Mazur, Abdallah Al Hammadi.
3pm: Handicap (PA) Dh40,000 (D) 1,700m
Winner: AF Athabeh, Tadhg O’Shea, Ernst Oertel.
3.30pm: Handicap (PA) Dh40,000 (D) 1,700m
Winner: AF Eshaar, Bernardo Pinheiro, Khalifa Al Neyadi
4pm: Gulf Cup presented by Longines Prestige (PA) Dh150,000 (D) 1,700m
Winner: Al Roba’a Al Khali, Al Moatasem Al Balushi, Younis Al Kalbani
4.30pm: Handicap (TB) Dh40,000 (D) 1,200m
Winner: Apolo Kid, Antonio Fresu, Musabah Al Muahiri
COMPANY%20PROFILE
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Red flags
- Promises of high, fixed or 'guaranteed' returns.
- Unregulated structured products or complex investments often used to bypass traditional safeguards.
- Lack of clear information, vague language, no access to audited financials.
- Overseas companies targeting investors in other jurisdictions - this can make legal recovery difficult.
- Hard-selling tactics - creating urgency, offering 'exclusive' deals.
Courtesy: Carol Glynn, founder of Conscious Finance Coaching
Libya's Gold
UN Panel of Experts found regime secretly sold a fifth of the country's gold reserves.
The panel’s 2017 report followed a trail to West Africa where large sums of cash and gold were hidden by Abdullah Al Senussi, Qaddafi’s former intelligence chief, in 2011.
Cases filled with cash that was said to amount to $560m in 100 dollar notes, that was kept by a group of Libyans in Ouagadougou, Burkina Faso.
A second stash was said to have been held in Accra, Ghana, inside boxes at the local offices of an international human rights organisation based in France.
Key findings of Jenkins report
- Founder of the Muslim Brotherhood, Hassan al Banna, "accepted the political utility of violence"
- Views of key Muslim Brotherhood ideologue, Sayyid Qutb, have “consistently been understood” as permitting “the use of extreme violence in the pursuit of the perfect Islamic society” and “never been institutionally disowned” by the movement.
- Muslim Brotherhood at all levels has repeatedly defended Hamas attacks against Israel, including the use of suicide bombers and the killing of civilians.
- Laying out the report in the House of Commons, David Cameron told MPs: "The main findings of the review support the conclusion that membership of, association with, or influence by the Muslim Brotherhood should be considered as a possible indicator of extremism."
Juliet, Naked
Dir: Jesse Peretz
Starring: Chris O'Dowd, Rose Byrne, Ethan Hawke
Two stars
SWEET%20TOOTH
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Dubai World Cup factbox
Most wins by a trainer: Godolphin’s Saeed bin Suroor(9)
Most wins by a jockey: Jerry Bailey(4)
Most wins by an owner: Godolphin(9)
Most wins by a horse: Godolphin’s Thunder Snow(2)
Zimbabwe v UAE, ODI series
All matches at the Harare Sports Club:
1st ODI, Wednesday, April 10
2nd ODI, Friday, April 12
3rd ODI, Sunday, April 14
4th ODI, Tuesday, April 16
UAE squad: Mohammed Naveed (captain), Rohan Mustafa, Ashfaq Ahmed, Shaiman Anwar, Mohammed Usman, CP Rizwan, Chirag Suri, Mohammed Boota, Ghulam Shabber, Sultan Ahmed, Imran Haider, Amir Hayat, Zahoor Khan, Qadeer Ahmed
Pharaoh's curse
British aristocrat Lord Carnarvon, who funded the expedition to find the Tutankhamun tomb, died in a Cairo hotel four months after the crypt was opened.
He had been in poor health for many years after a car crash, and a mosquito bite made worse by a shaving cut led to blood poisoning and pneumonia.
Reports at the time said Lord Carnarvon suffered from “pain as the inflammation affected the nasal passages and eyes”.
Decades later, scientists contended he had died of aspergillosis after inhaling spores of the fungus aspergillus in the tomb, which can lie dormant for months. The fact several others who entered were also found dead withiin a short time led to the myth of the curse.
