Alphabet's Sundar Pichai admits no company immune if AI bubble bursts, but expects tech will last like internet

Metaverse

Alphabet’s Sundar Pichai admits no company immune if AI bubble bursts, but expects tech will last like internet – Crypto News

Published

3 weeks ago

November 18, 2025

Dripp

Alphabet CEO Sundar Pichai has admitted that an artificial intelligence (AI) bubble burst would have widespread impact across companies, including Google.

Speaking to the BBC on November 18, the tech chief said that “no company would be immune” including Google, if “irrational exuberance” in the AI market leads to a market bubble burst.

But overall, Pichai was optimistic about AI, noting that the scale of investments by the company has grown. “Four years ago, we were spending less than $30 billion per year. This year that number is going to be over $90 billion, and to collectively add, what all the companies are doing, we have well over a trillion dollars of investment going into building infrastructure for AI,” he noted.

The businessman explained the “scale equation” as what companies built over the past 10-20 years, is now being built in the next couple of years.

Also Read | Billionaire Peter Thiel’s fund sells full Nvidia stake, drives AI bubble concern

So, does Sundar Pichai think AI is a bubble ready to burst?

While optimistic about the technology, Pichai admitted that investment cycles can have “irrational” phases. When questioned directly on the bubble problem he said, “There are two ways of thinking about the question. I look at the actual progress, we are making in terms of the AI model capabilities, and people are using, and they’re deploying it. Consumers are excited and companies are using, so you see real demand.”

He added that while the excitement “is very rational, we go through these investment cycles, there are moments we overshoot.”

Pichai sought to explain that despite risks of a burst, AI is more like the internet that a passing fad. “Collectively as an industry, we can look back at the internet right now and there was clearly a lot of excess investment. But none of us would question whether the internet was profound or fundamentally changed how we work digitally as a society. I expect the AI to be the same. So I think it’s both rational and there are elements of irrationality.”

Also Read | Warren Buffett’s final investments rocket Alphabet stock 5% after rare tech bet

What about AI bubble burst impact on Google?

When asked if Google would be immune from a burst because of investments across technologies, Pichai was clear: “No company is going to be immune, including us.”

But added, “If you over invest, you will have to work through that phase. But you know, we are better positioned for many years. We’ve taken a deeply differentiated approach to AI.”

According to Pichai, one of the first things he did as CEO was to shift the company to an AI first approach. What does this mean? He said, “We call it a full stack approach. From the underlying physical infrastructure to the research that you need to do to drive this technology forward, to deploying it in products and platforms. We have taken the deep approach. So we are able to invest at scale and make it work across all these products and businesses And I think so we are better positioned to take a long-term view.”

Notably, Alphabet shares have surged about 46% in 2025, with even tech shy Warren Buffett‘s Berkshire Hathaway acquiring a $4.93 billion stake in the company.

Also Read | What if the $3trn AI investment boom goes wrong?

What are the fears over AI bubble burst?

Notably, Pichai’s statements come amid rising concerns among investors that tech valuations have peaked. At risk is the trillions of dollars flushed into AI commitments such as advanced chips and billion-dollar data centres.

Investors’ worries have heightened as US economy bellwether Berkshire sits on record cash reserves instead of investing, and after billionaire Peter Thiel‘s hedge fund and Masayoshi Son’s SoftBank Corp both sold off stake in AI chips major Nvidia last week.

According to a regulatory filing with the United States Securities and Exchange Commission (US SEC) on November 14, Thiel Macros sold around 5,37,742 Nvidia shares — its entire stake in the tech company — worth around $100 million, as of closing on September 30, 2025.

Just a few days earlier on November 11, Masayoshi Son-led SoftBank Group Corp said that it had sold its stake in Jensen Huang’s company, pocketing $5.83 billion. However, it has continued to invest in Sam Altman-led OpenAI.

Investors will thus be closely tracking Nvidia’s Q3 results (due on November 19) to soothe concerns. At this point, the chipmaker’s demand pipeline might as well act as a bell weather for the entire AI industry.

Key Takeaways

Alphabet and Google CEO Sundar Pichai admitted that the AI market is at risk of a bubble, with irrational investment cycles.
He however compared AI’s potential to the foundational impact of the internet on society.
Pichai added that Google’s shift to an AI-first approach positions it well for the future.