AI’s biggest profits now come from betting on itself
Across the Magnificent Seven, the group of megacap firms that also includes Microsoft, Meta, Apple, Tesla, and Nvidia, the seven together booked US$315.6bn in net profit for the second quarter, of which US$134.6bn, or about 42 percent, came from investment gains, Satori founder Matt King told The New York Times after adjusting the reported figures for taxes.
That share stood at about 5 percent in the previous quarter, and stripping out the gains would have left group profits roughly flat rather than growing, King said.
He described the dynamic as “circular” in the same interview, warning that the capital funding AI is increasingly AI itself, and adding that the stock market has become one of the economy’s main engines rather than only a reflection of it.
The reported gains are largely unrealized.
Under accounting rules, as The New York Times explained, the paper value of investment holdings at the end of each quarter is added to profit, and a decline in those holdings can subtract from earnings just as readily.
