LFLearn with Faisal

Is AI a Bubble? Both Sides Have a Point

Faisal Adnan · 05 Nov 2026

The bull case: it is real

  • Revenue is growing very fast. The slide notes Anthropic's revenue grew about 14 times in a year and OpenAI's about 3 times. Anthropic's IPO filing on 26 October 2026, reported by Beinsure, disclosed fast growth. The Decoder reported that in the first quarter of 2026 OpenAI took in $5.7 billion in revenue, triple the year before.
  • Chip demand is strong. AMD's data-center sales were reported up 97% on 3 November 2026. (I could not open that page while writing, so check the original market report.)
  • Big Tech mostly pays from cash flow, not from dot-com-style debt.
  • A 10% correction is normal in markets and does not make a crash.

The bear case: it is frothy

  • Spending is far ahead of revenue. About $800 billion a year is going into infrastructure.
  • The losses are huge. The same Decoder report says OpenAI burned about $3.7 billion in that first quarter, and the slide cites a net loss of $21.3 billion in a single quarter. Anthropic's filing also reported a large net loss.
  • Circular financing inflates demand, as I explained in the post on the spending boom.
  • Warnings from the top. Fortune wrote about Sam Altman's paradox: warning of a bubble while raising trillions, with Altman saying investors are overexcited. The IMF and the Bank of England have both warned of a significant market correction if enthusiasm for AI cools.

What history says

In 2000 the dot-com bubble burst, and the internet still won. Many companies disappeared, and the survivors became the biggest on earth. Whatever happens to share prices, the shift in skills is not going to reverse. A company that learned to run reports with AI will not forget how.

How I plan around it

  • Do not tie your career to the fortune of one company. Tie it to skills that transfer: data, evaluation, security, integration.
  • If the money tightens, businesses will care more about practical use cases and proven savings. That favours people who can show results.
  • Keep your investments and your learning separate. One is about prices, the other about capability.

Sources

Part of the talk "The AI Era" by Faisal Adnan, Riphah International University, 6 November 2026. Nothing here is financial advice.