Is AI bubble about to burst? Zoho founder Sridhar Vembu says don’t overhype adoption, ‘good things take time

Despite the global buzz around artificial intelligence (AI) and concerns over mass job losses, new data suggests that corporate adoption of AI may actually be slowing down rather than accelerating.

A report by Apollo Academy, citing a biweekly survey from the US Census Bureau, found that AI adoption has been declining among companies with over 250 employees. The survey, which covered around 1.2 million firms, looked into businesses using tools such as machine learning, natural language processing, virtual agents, and voice recognition to support production or services over the last two weeks.

Sharing insights from the survey, Zoho founder Sridhar Vembu stressed the importance of patience in innovation. “Good things take time. We are investing heavily in R&D in various aspects of AI but we will not overhype it,” Vembu said.



Adding to the skepticism, Fortune recently reported that tech giants like Microsoft, Google, and Amazon Web Services—once expected to spend billions on AI at scale—are now pulling back on major investments. This retreat is partly linked to poor returns on pilot projects.

A Massachusetts Institute of Technology (MIT) study revealed that 95% of corporate AI pilot programs fail to generate a return on investment. While more than 80% of companies have explored or experimented with tools such as ChatGPT or Microsoft Copilot, the study found these mainly improve individual productivity rather than delivering measurable impact on company profits.

OpenAI CEO Sam Altman has also admitted that investor enthusiasm may be running ahead of reality. “When bubbles happen, smart people get overexcited about a kernel of truth... Are we in a phase where investors as a whole are overexcited about AI? My opinion is yes,” he said earlier.

Notably, tech guru Erik Gordon also told Business Insider that the financial fallout of the AI boom stalling will be much greater than the dot-com bust. Echoing this, The Atlantic recently observed that despite heavy spending, evidence of AI’s real-world payoff remains elusive. Many companies have yet to see meaningful returns, while predictions of widespread job displacement have not materialized.