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Everywhere you look, analysts and commentators claim AI is in a massive bubble that will burst shortly.

The facts do not support this claim. Yes, there are certain AI companies that are extremely overvalued (PLTR trades at a P/E of 400+). But it is VERY difficult to argue that AI is a bubble when the Big Tech hyper-scalers are trading at LOWER forward P/E ratios than Walmart or Costco.

NVDA trades at a forward P/E or 23… and Costco trades at a forward P/E of 42. What kind of AI bubble is this?

Moreover, for all the hype and hope about AI in the financial media, the reality is that corporate America has BARELY begun to introduce the technology. According to research by Bank of America/ Merrill Lynch, only 15% of large companies have actually adopted AI technology. That’s somewhere between one in six or one in seven!

Put another way, 85% of large corporations are NOT using AI currently. And please note that adoption rates actually peaked for large companies in mid-2025 and have seen been declining!

It’s tempting to blame this low level of AI-adoption by large companies on corporate inertia; large companies are slow to pivot and introduce new strategies or technologies. Well, take another look at that chart and you’ll see that AI adoption rates for smaller firms are even lower at a mere 7%!

That’s just ONE IN FOURTEEN!

But wait… there’s more.

Even amongst those companies that have adopted AI technology, thus far few if any been able to generate any significant results! As I noted earlier this year, a review by MIT titled “The GenAI Divide: State of AI in Business 2025,” found that 95% of companies fail to achieve measurable financial returns from their AI initiatives, with only 5% demonstrating rapid revenue acceleration or significant business value.

Put simply, for all the hype and hope, AI adoption at corporate America has been minimal (only 1 in 7) and out of that 15% of companies that have introduced AI, only 5% have seen a meaningful uptick in financial results. This means that less one out of 100 companies (0.7% of corporate America) could truly be considered an AI success story as of late 2025.

The implications of this are vast. For one thing, it means we are much earlier in the AI cycle that most people realize. Either AI proves to be a complete dud and the market collapses into a bear market led by Tech… or we are on the cusp of widespread adoption and the AI bubble does in fact get a LOT larger.

I believe we are on the cusp of widespread adoption. And as I’ll detail in tomorrow’s article… the markets agree with me.

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