LONDON, UK — Sundar Pichai, CEO of Alphabet Inc. and its flagship subsidiary Google LLC, has sounded a rare note of caution in the booming artificial-intelligence (AI) market, warning that no company — not even Google — is immune if the AI bubble bursts.
Speaking exclusively to the British Broadcasting Corporation, Pichai described the recent surge in AI investment as an “extraordinary moment,” but acknowledged an undercurrent of “irrationality.”
“I think no company is going to be immune, including us,” he told the BBC, in an interview filmed at Google’s California headquarters. His remarks underscore growing unease within Silicon Valley and beyond about whether today’s frothy valuations and ever-expanding AI spending are sustainable.
The warning comes at a time when Alphabet’s value has surged, partly on investor belief in the company’s ability to fend off competition from fast-rising players like OpenAI.
Alphabet shares doubled in value over seven months, bringing the firm’s market capitalisation near US$3.5 trillion. Meanwhile, rival chip-maker NVIDIA Corporation recently hit a US$5 trillion valuation, fuelled by its dominance in supplying hardware for AI training.
Pichai drew a parallel with the dot-com boom of the late 1990s: “We can look back at the internet right now. There was clearly a lot of excess investment, but none of us would question whether the internet was profound.” He added, “I expect AI to be the same. So I think it’s both rational and there are elements of irrationality through a moment like this.”
His own firm, Pichai argued, is better placed to weather any downturn because of its “full-stack” business model — encompassing chip design, data assets (such as the YouTube platform), frontier AI research, and global reach. But despite that, Pichai insisted the company is not bulletproof.
Pichai also used the interview to highlight Alphabet’s growing commitment to the UK. He announced that Google would invest £5 billion in UK AI infrastructure and research over two years, and revealed it plans to train AI models in Britain — a step ministers hope will bolster the UK’s goal of becoming the world’s third “AI superpower.”
On another front, the executive acknowledged that AI’s massive energy requirements are a growing concern. He cited figures suggesting AI accounted for roughly 1.5pc of global electricity consumption last year and stressed that scaling up without constraining national-level energy supply would have wider consequences.
The energy demands have also slowed progress toward the company’s climate target of net-zero emissions by 2030.
On the issue of jobs and work, Pichai offered a balanced view: “We will have to work through societal disruptions,” he said, while noting “it will also create new opportunities.” He stressed that professionals such as teachers and doctors will still be needed — but those who adapt to AI tools will thrive.
Industry observers say Pichai’s comments are a significant recalibration of tone from the usually bullish tech executive. They come amid rising scrutiny over whether AI funding, acquisitions, and valuations are being driven by technological fundamentals or overheated expectations.
The message is clear: the march of AI is real and likely transformational — but the path ahead could be bumpier than many assume.
