When it’s not AI’s growth that scares, but its consequences

The market has, for the first time, truly become afraid not of AI’s growth, but of its consequences. This is an important psychological turning point that investors seem to have postponed for a long time. Until recently, artificial intelligence was viewed almost exclusively as a story of acceleration, technological progress, and new trillions in market capitalization. But this week the focus shifted sharply. It became clear that AI is not only a growth engine for those who build it, but also a tool of pressure on those who earn money from human labor, commissions, and expensive services.

What began as a local correction in the software sector spread within just a few days into finance, logistics, and the service economy. Investors suddenly saw the more unpleasant side of automation: it does not merely increase efficiency, it begins to “eat margins.” If the market once bought AI as a new industry, it is now starting to value it as a technology capable of crushing profitability across entire sectors.

The week closed lower across the major indices. The S&P 500 fell by about one and a half percent, the Nasdaq lost around two, and the Dow also moved down. This does not look like panic in the classical sense, but sentiment has changed. The fear is not that AI will stop growing. The fear is that it will begin redistributing profits so quickly that many familiar business models will be called into question.

The first to come under pressure were software giants such as Salesforce and ServiceNow. One might assume they should be the main beneficiaries of automation. But the market is looking broader: if AI makes corporate software cheaper, if it lowers the cost of implementation and maintenance, then it becomes harder for companies to sustain previous price levels and high subscription fees. Even the sector itself, through ETFs, has already dropped noticeably since the start of the year, showing that investors are beginning to price in a margin-compression scenario.

But the most interesting part is that the удар did not stop with technology. The wave moved further – into areas where no one previously expected AI to become a threat.

Logistics became one of the first unexpected examples. The emergence of AI tools that allow transportation and supply chain management to scale without proportional staff growth instantly changes the economics of the industry. Where business growth once meant more people, it now means more algorithms. And that makes companies built on the traditional model of expensive operational management look increasingly vulnerable.

The financial sector has also felt the pressure. Wealth management, brokers, consultants – an entire industry where a significant share of revenue depends on commissions for advice, support, and tax planning – is facing a new reality. The launch of AI solutions for automated taxation and financial recommendations has forced the market to ask: if part of a consultant’s work can be replaced by a product, what will those commissions be worth in a few years? Even if clients remain, the price of the service may decline.

That is why even strong names like Microsoft and Palantir were caught in the wave of repricing. This is not about the market losing faith in AI as a trend. On the contrary, the market is beginning to understand that the scale of the trend is so large that it affects everyone, not only developers. When a technology becomes universal, it stops being a bonus and becomes a competitive factor that can erase the advantages of those who have lived too long by the old rules.

It is important to emphasize: this is not a collapse of the AI theme. It is the maturation of the narrative. Euphoria is giving way to a harsher and more realistic assessment of winners and losers. For the first time, the market is seriously asking not “how fast will AI grow,” but “who will pay for that growth.”

Some strategists believe the sell-off is overheated, because the overall backdrop remains supportive. Tax incentives, regulation, and the resilience of other sectors such as energy, commodities, and consumer staples provide a cushion. This does not look like the beginning of a bear cycle, but rather a painful rotation within the market.

The main takeaway for investors is that AI is no longer just a growth story. It is a story of profit redistribution between industries. Money is beginning to flow away from those being automated and toward those who know how to integrate AI into their model while maintaining control over margins.

Volatility remains high, the market is nervous, but breadth is still strong. And what is happening looks more like a reshuffling of pieces on the board than the collapse of the entire game. Investors have simply realized for the first time: artificial intelligence is not only a new source of revenue, but also a new force that will relentlessly compress profits in places where they once seemed guaranteed for decades.