Discussions around artificial intelligence dominated the 2026 World Economic Forum meeting in Davos, Switzerland. Prognosticators said the situation may get worse before it improves.
Top executives talked about improved productivity and economic impact with advances in finance, healthcare, and other sectors. But others noted concerns about the unchecked race to superintelligence, warning that AI’s illusions could move society in the wrong direction. Additionally, AI will cost jobs, constrain resources, create technical issues, and raise regulatory concerns, they said.
“AI is in a very primitive age. We have a lot to do,” said Eric Xing, president at Mohamed bin Zayed University of AI (MBZUAI), during a WEF panel discussion.
Other panelists said AI is being designed in the image of human intelligence, which is not the point of AI. Intelligence can be fallible, and AI should not be an extension of humans, they said.
Even the most intelligent beings can be deluded, said Yuval Harari, a well-known Israeli author and historian.
“The lesson from history about intelligence: you don’t need a lot of intelligence to change the world and potentially cause havoc. You can change the world with relatively little intelligence,” Harari said, adding that he was not referring to any particular person.
There could also be technical issues: if one machine goes down and then the entire system goes down, MBZUAI’s Xing said. “Performance-wise, there are not enough checkpoints to control and visualize and understand risky points,” he said.
AI vendors including Tesla, Nvidia, and Microsoft were the most active proponents of AI at WEF. These companies have made AI abundant by investing billions in infrastructure, with trillions more committed to data centers and chips.
But the infrastructure buildout is outpacing the available energy and needs to start producing results, said Microsoft CEO Satya Nadella during an on-stage interview at WEF.
“We will quickly lose the social permission to take energy, a scarce resource, and use it to generate these tokens if they’re not improving health outcomes, education outcomes, public sector efficiency, private sector competitiveness,” Nadella said.
Meanwhile, AI hype has boosted the valuations of AI startups by billions of dollars, which has created the fear of an AI bubble.
There is concern that potential adjustments in tech valuations and tariffs could hurt economies, said Christian Keller, Head of Economics Research at Barclays Investment Bank, in a YouTube discussion posted by the WEF ahead of the conference. A majority of chief economists believe the AI bubble could burst as AI-related stocks start declining later this year, the WEF said in its January 2026 Chief Economists Report.
But there are credible arguments against viewing the AI boom as a bubble. “Unlike the dot-com era, today’s leading AI firms are already highly profitable, with strong earnings growth underpinning rising share prices and significant real investment in data centers and infrastructure,” the WEF report said.
Nvidia CEO Jensen Huang said there is no AI bubble as the demand and spot pricing for its GPUs are through the roof. “The AI bubble comes about because the investments are large… We have to build the infrastructure necessary for all layers of AI above it,” Huang said, adding, “the opportunity is really quite extraordinary.”
But Ashwini Vaishnaw, India’s minister of electronics and information technology, threw cold water on a massive, trillion-dollar AI infrastructure buildout to advance economies. Large genAI models don’t give countries an AI advantage, as small models can do 95% of the work while consuming a fraction of the power, Vaishnaw said during a panel discussion at WEF.
The return on investment will come down to “deploying the lowest cost solution to get the highest possible return,” Vaishnaw said.
Instead, companies heavily investing in AI infrastructure and massive models face tremendous financial risk, Vaishnaw said, taking indirect aim at the United States. “The people who are creating those large models might go bust in the coming years. You never know, they might go bankrupt in the coming years,” he said.
Amid the discussions, WEF makes clear the AI megatrends to chase in 2026, said Steven Dickens, principal analyst at Hyperframe Research.
AI is moving from the ‘think and write’ stage to ‘seeing and doing’ as it moves to more industries such as healthcare, manufacturing, and retail, Dickens said. “This means more of the general workforce will have AI impact their lives on a daily basis,” Dickens said.
AI is a “path to abundance for all,” said Tesla CEO Elon Musk in an on-stage discussion at WEF.
“My prediction is… we’ll make so many robots and AI that they will saturate all human needs,” said Tesla CEO Elon Musk.
At the same time, humans need to be careful with AI, he noted. “We don’t want to find ourselves in a James Cameron movie. We don’t want to be in Terminator,” Musk said.
Related reading:
- Nadella redefines ‘sovereignty’ for the AI era — analysts call it smart, self‑serving
- Anthropic’s Claude AI gets a new constitution embedding safety and ethics
- Nadella warns of AI bubble unless more people use the technology
- How to prepare for an AI bubble burst
