Author: Sabah NovinFar
The End of 2025 and the Artificial Intelligence Bubble
As the end of 2025 approaches, the artificial intelligence bubble has managed to navigate the markets without causing serious damage. Nevertheless, concerns about valuations have increased noticeably. The central question is this: are markets overly optimistic about the real impact of artificial intelligence? And will we witness a “reality check” next year?
Artificial Intelligence and Real Productivity
The general perception of AI is that it makes processes faster and more efficient and increases productivity. Imagine you are an orange juice seller and intend to purchase a highly advanced machine for extracting juice from fruits. People eagerly pay money without worrying about your current profits, because they believe this technology will transform the business.
In reality, the AI market is not yet at the stage of a reality check. The key questions for investors are as follows:
Is the new technology truly efficient?
To what extent have production costs and time been reduced?
Have companies’ profit margins increased in a meaningful way?
The year 2026 will likely be the time when these questions are answered.
Productivity; the Valuation Metric of Technology Giants
Simply investing in artificial intelligence is no longer sufficient; the important point is how this technology translates into real profitability. Investors are no longer attracted solely by promises, and the focus has shifted to productivity and return on investment.
Google and Meta
These companies can clearly demonstrate how AI links productivity to growth in advertising revenue and cloud services. Google, with its cloud business, and Meta, with its social networks, are among the companies that can quickly reveal real effects.
Amazon and Microsoft
These companies have made massive investments to avoid falling behind. Amazon is trying to demonstrate productivity through AI based robots, warehouses, websites, and cloud services. Microsoft has focused its efforts on Copilot software, whose real test will be reflected in the numbers: how many users are willing to pay for AI software?
Nvidia
Nvidia is the primary symbol of the artificial intelligence bubble. The launch of Blackwell chips shows that demand is still outpacing supply, but if major companies like Amazon and Microsoft develop their own proprietary ecosystems, pressure on Nvidia will increase. The key question is this: are investor expectations so high that even the slightest misstep will be punished?
If everything goes according to plan, Nvidia could become one of the first companies with a market capitalization of 5 trillion dollars and, in the long term outlook, even reach 10 trillion dollars.
Conclusion: 2026 - The Year of Productivity and the Reality of AI
2026 is likely to be the point at which technology giants must demonstrate how their investments in artificial intelligence have translated into higher profitability and tangible productivity gains. Investors will no longer be swayed solely by hype and promises; instead, the real, measurable value of AI will determine companies’ standing in the market.