Apollo Economist: AI Boom Benefits Only Seven Firms, Leaving Broader Economy Stagnant

Key points

• Torsten Slok, chief economist at Apollo Global Management, published a report on October 24, 2026, stating that AI has delivered zero financial payoff to corporate America outside the technology sector.
• Inflation-adjusted revenue per worker has risen significantly for the Magnificent Seven (Nvidia, Tesla, Amazon, Microsoft, Alphabet, Apple, Meta), reaching nearly $800,000, while remaining flat at approximately $550,000 for the rest of the S&P 500.
• Profit margins for the Magnificent Seven have increased, whereas margins for the other 493 S&P 500 companies have stagnated at around 10%.
• Slok notes that there is no evidence AI is boosting overall productivity growth, with total factor productivity showing no significant uptick.
• Mainstream corporations are pulling back on AI spending, viewing token costs as a margin-dragging expense rather than an investment in future growth, unlike venture-backed firms which continue to increase spending.
• Slok argues that AI functions as a calculator but lacks the judgment, accountability, and cultural understanding required for business success, making it difficult for non-tech firms to leverage AI for revenue growth.

Background

This analysis follows a period of record highs for U.S. stock markets in October 2026, driven largely by AI-related stocks. In early October, the S&P 500 reached 7,818.93, with Nvidia leading the rally. However, concerns about an AI bubble and potential market corrections have persisted, with some strategists warning of a possible 35% drop in the S&P 500 if AI capital expenditure fails to yield returns. Slok’s report adds to these concerns by highlighting the lack of broad-based economic benefits from AI.

How outlets are covering it

TechSpot and Business Insider both report on Torsten Slok’s findings, emphasizing the stark divide between the Magnificent Seven and the rest of the S&P 500. Business Insider highlights the specific metrics of revenue per worker and profit margins, underscoring the stagnation in the broader economy. TechSpot focuses on the broader implications for macroeconomic trends and the potential for AI to remain confined to a small portion of the economy. Apollo Global Management’s original report provides the detailed data and Slok’s argument that AI’s impact is limited due to its inability to replicate human judgment and cultural understanding. Goldman Sachs’ Jan Hatzius offers a contrasting view, believing that AI investment will eventually pay off, though this perspective is not detailed in the provided sources.

Why it matters

Slok’s analysis suggests that the AI boom may not translate into broad economic growth, potentially leading to a more uneven distribution of benefits and increased financial risks. If mainstream corporations continue to treat AI as a cost rather than a growth driver, the macroeconomic impact of AI could remain limited, affecting overall productivity and profitability. This could have implications for market stability, corporate strategies, and the broader economy, as investors and businesses reassess the value of AI investments.

What to watch

The key question is whether mainstream corporations can eventually leverage AI to improve revenue and margins as models become commoditized and cheaper. If AI remains confined to the tech sector, its macroeconomic effects will likely stay limited. Investors and businesses will need to monitor whether AI adoption translates into broader economic benefits or if the current trend of treating AI as a cost center persists. The outcome could influence market valuations, corporate strategies, and the overall trajectory of the U.S. economy.