Apollo Economist Says AI Token Spending Is Squeezing U.S. Margins

Apollo Global Management Chief Economist Torsten Slok said some U.S. companies outside technology are beginning to treat AI token consumption as a cost center that is squeezing margins, raising questions about returns on corporate spending.

Slok said revenue per employee is rising at seven tech giants but remains flat at the S&P 500’s other 493 companies. Profit margins show a similar pattern, and he said there is no sign AI is driving productivity growth.

Mainstream companies are pulling back on spending and increasingly view AI token consumption as a cost rather than a source of growth, Slok said.

Investors are watching corporate AI spending during earnings season for signs that the investments are producing returns.