Tech investor Chamath Palihapitiya warned on Tuesday that artificial intelligence usage could negatively impact some companies' earnings, stating that C-suite executives will have to contend with spending they "didn't know existed inside of their organization." Palihapitiya, founder of investment firm Social Capital and CEO of AI company 8090, told CNBC that CEOs and CFOs "probably have no idea how much tokenmaxxing is going on inside of their organizations." His comments reflect growing industry concerns about untracked AI expenditures as companies rapidly adopt AI tools without clear cost oversight mechanisms.
Palihapitiya Warns Executives About Hidden AI Token Costs
Palihapitiya told CNBC he suspects companies will experience earnings misses due to unaccounted AI spending. "I suspect what'll happen is one day you're going to have a miss, and EPS will be off by a few pennies, and the CEO will say to the CFO, 'What happened?'" he said. The investor hosts the tech podcast "All-In" and has become a controversial figure in Silicon Valley due to his role in promoting special purpose acquisition companies during the Covid pandemic, many of which have since shuttered and resulted in substantial losses for investors.
8090 AI Spending Trends Toward $10 Million Annually
In 2024, Palihapitiya founded 8090, a company building a platform where people can collaborate with AI agents to develop enterprise software. The company announced a $135 million funding round led by Salesforce in June. Palihapitiya said in March that his company's AI spending is trending toward more than $10 million a year, which "feels very scary" as the founder of a small startup. He wrote in a post on X at the time: "Anyways, just sharing our current lived experience as I suspect many other companies are also feeding this revenue ramp without getting any meaningful ROI from it."
Palihapitiya Acknowledges SPAC Promotion as Mistake
Palihapitiya addressed his SPAC history on Tuesday, saying there were "some parts" of those investments that worked, but he added that it was a "huge mistake" to promote the SPACs on social media and CNBC. "Who didn't make money? Speculators," Palihapitiya said. "Now, do I feel bad for them? Yes. Were my incentives misaligned with them? Also yes." He launched a new SPAC, the American Exceptionalism Acquisition Corp. A (AEXA), last year, which is designed to target companies in AI, energy, defense and decentralized finance.
Industry Leaders Criticize Token-Based AI Pricing Models
Palihapitiya is one of a growing chorus of investors and tech executives cautioning that the era of so-called tokenmaxxing, where employers have incentivized staffers to use as much AI as possible, is over. His comments echo concerns shared by Palantir CEO Alex Karp, who sharply criticized OpenAI and Anthropic for their token-based pricing models earlier this month. "I'm not throwing shade at them, but something has gone completely wrong," Karp told CNBC's "Squawk Box." "The basic view among enterprises in this country is I'm going to chillax and waste my time with tokens."
FAQ
What did Chamath Palihapitiya warn about AI token spending?
Palihapitiya warned on Tuesday that artificial intelligence usage could negatively impact some companies' earnings because CEOs and CFOs "probably have no idea how much tokenmaxxing is going on inside of their organizations." He told CNBC he suspects companies will experience earnings misses due to unaccounted AI spending.
How much is 8090 spending on AI annually?
Palihapitiya said in March that his company 8090's AI spending is trending toward more than $10 million a year. The company announced a $135 million funding round led by Salesforce in June.
Why did Palantir CEO criticize OpenAI and Anthropic?
Palantir CEO Alex Karp sharply criticized OpenAI and Anthropic for their token-based pricing models earlier this month, telling CNBC's "Squawk Box" that "something has gone completely wrong" and that "the basic view among enterprises in this country is I'm going to chillax and waste my time with tokens."
