The biggest risk to the artificial intelligence (AI) trade may not be Nvidia (NVDA) or any of the mega-cap tech stocks investors have crowded into. According to "Big Short" investor Steve Eisman, it could be two private AI companies sitting at the center of the spending boom: OpenAI (OPEAZZX) and Anthropic (ANTHZZX).
“The entire AI ecosystem food chain is dependent upon the future health and success of Anthropic and OpenAI,” Eisman said in an interview on Friday with David Lin. “It’s a little nerve-racking that the entire U.S. economy is dependent upon two companies that lose billions.”
The dependence spreads throughout the broader technology ecosystem, from chip sales by Nvidia (NVDA) to cloud revenue for hyperscalers, said Eisman. He referred to the concentration of AI spending and said the future performance of OpenAI and Anthropic might have big repercussions for the entire tech sector. If corporate spending on AI starts to slow, he said, "the whole tech space sells off."
Eisman said he was more concerned about OpenAI, which he described as the “weak sister” of the two. OpenAI’s income growth has cooled, he added, and expenses were mounting rapidly. By his numbers, income at OpenAI was up nearly $1 billion sequentially, while costs soared by some $3 billion during the same period. “That’s not the right direction,” Eisman said.
Eisman said that for buyers, making money might not be the most important thing right now, but revenue growth remains critical. He said that a slowdown in the second half of the year could be very bad for the AI trade as a whole. When asked what a drop in business-to-business spending on AI could mean for tech stocks, he said, "I think the whole tech space sells off." However, Anthropic was still not out of trouble, Eisman hinted.
Eisman said he foresees Anthropic’s revenue story remaining healthy during the first half of the year. But he suggested the second half could be more telling as corporations become more aware of their AI spending. He pointed to the end of what he called “token maxing,” when firms were throwing money at AI tokens without much concern for cost.
The time of heavy spending ended in June, he said, meaning the future quarters will be a more crucial test for both Anthropic and OpenAI. Eisman said he was especially interested in the financial disclosures that could come when Anthropic eventually files for an IPO, which could provide investors a fuller view of the company’s growth and economics.
The concentration of the AI trade is a big market risk, Eisman warned. He thinks the outcome for both OpenAI and Anthropic might decide if the current AI investment bubble continues. He later went further, adding that if OpenAI were to fail, the U.S. economy may see an imminent recession and markets could see a significant correction.
“If tomorrow OpenAI failed, the U.S. economy I think, would go into an immediate recession, and the market would have a massive correction,” Eisman said.
He emphasized that he was not predicting such an outcome, and that the timing of any potential problems was unknown. However, Eisman regards this issue as the most significant risk to markets today.
Earier this month, Eisman warned that ‘Achilles' heel’ of the AI boom was the growing dependence on OpenAI and Anthropic, adding that if these two companies lose market share to cheaper Chinese openweight AI models, it could trigger a price war and create problems across the larger AI ecosystem.
On Stocktwits, retail sentiment around OPEAZZX and ANTHZZX were in the ‘bullish’ zone.
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