City Analysts Warn AI Bubble May Burst as 42% of Firms Abandoned Projects
Updated
Updated · OilPrice.com · Jul 12
City Analysts Warn AI Bubble May Burst as 42% of Firms Abandoned Projects
3 articles · Updated · OilPrice.com · Jul 12
Summary
42% of organizations abandoned most AI initiatives in 2025, up from 17% in 2024, reinforcing City analysts’ warning that the AI boom is nearing a break.
More than 80% of industrial AI projects fail, a RAND report found, as current systems struggle with complex, variable conditions, weak data and missing real-world context.
Ford’s experience illustrates the problem: after AI systems proved less resilient than expected, the automaker brought back and promoted more than 350 experienced engineers to rebuild lost institutional knowledge.
That skepticism is spreading beyond operations into markets, where investors have piled into seven megacap tech stocks and credit markets earlier signaled strain through widening CDS spreads.