By Beth Kindig – Artificial intelligence is frequently discussed yet it’s too early to show real gains. AI’s major headwind is the cost of the investment, which will skew returns in the short-term. When the turnaround occurs, however, companies who are making the investment can expect to be rewarded disproportionately with a wide performance gap. In a recent report, McKinsey predicts AI leaders will see up to double the cash flow.

We can see some evidence of this in Alphabet’s revenue segment, Other Bets, which includes many AI projects with a loss of $3.35 billion in 2018. Of this, Deep Mind is responsible for $571 million in losses and owes its parent company $1.4 billion. The autonomous driving project, Waymo, had its valuation cut by 40% due to delays last September.  

We see other companies taking on massive and expensive AI projects, such as Baidu, Facebook, Tesla, Alibaba, Microsoft and Amazon. Except for Tesla, these companies are flush with cash and can afford the transition costs and capital expenditures required for artificial intelligence.

Despite tech giants pouring cash into AI investments, most of the industries that stand to benefit are not in the tech industry, per se. This week, I attended Re-Work’s Deep Learning and AI Summit, where AI engineers and executives gathered for presentations and discussions about the projects they’re spearheading.  Read On: