Former Meta executive says AI could be headed for a correction (www.businessinsider.com)

Former Meta executive Nick Clegg warned that the AI investment boom shows “pretty prominent features” of a bubble and that the “chance of a correction is pretty high.” Drawing on his tenure at Meta and in government, Clegg highlighted runaway valuations and frenetic dealmaking as signs that many companies are pouring huge capital into AI without clear, sustainable business models to recoup those costs. He singled out the enormous spending on data centers and compute as a key vulnerability: firms that invest billions in infrastructure will eventually have to prove long-term returns. Clegg also flagged technical limits to today’s probabilistic AI models, casting doubt on a straightforward path to “super-intelligence,” even as he acknowledged the technology will persist and have major effects. Practically, that means short-term winners may be those who can monetize services or repurpose expensive infrastructure, while weaker players could face sharp corrections. The market picture is contested — Eric Schmidt called AI’s rise a new industrial shift, and Jamie Dimon urged a case-by-case view — but Clegg’s comments crystallize a growing investor scrutiny around valuation, compute commitments (OpenAI’s recent ~$1 trillion in compute agreements was cited), and the need for realistic ROI timelines.