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| "Shark Tank" investor Kevin O'Leary told BI the AI boom wasn't a bubble because you "can see the productivity and measure it on a dollar-by-dollar basis." Andrew Harnik/Getty Images |
Plenty of investors and economists have been quick to draw parallels between today’s artificial intelligence boom and the dot-com bubble of the late 1990s. But “Shark Tank” star and O’Leary Ventures chair Kevin O’Leary is not among them.
In an interview with local press, O’Leary pushed back on the comparison, arguing that unlike the internet frenzy of 20-plus years ago, AI’s impact is already measurable in hard dollars.
“This isn’t the same hype that the internet bubble was,” he said. “Today, you actually can see the productivity and measure it on a dollar-by-dollar basis.”
He pointed to one of his own portfolio companies, Fly Guys, which uses drones to scan rooftops and provide “AI-ready aerial imagery.” Large retailers like Walmart or Home Depot can then automatically detect issues and generate work orders.
“That saves millions of dollars,” O’Leary explained. “These are tangible, measurable results, not speculative promises.”
In his view, those kinds of efficiencies could help companies absorb potential cost increases from tariffs and help sustain the lofty valuations that AI-related stocks currently command. Whether that thesis holds will become clearer over the next 12 to 18 months, as earnings reports begin to reflect AI-driven cost savings.
Tariffs: More Bark Than Bite?
O’Leary’s confidence extends beyond AI. He also believes the fears surrounding U.S. tariffs have been largely overblown.
Back in April, when Donald Trump unveiled a sweeping tariff plan on “Liberation Day,” markets swooned. But the sell-off proved short-lived stocks have since staged a powerful rebound to reach fresh record highs.
To O’Leary, it’s a textbook example of why investors should avoid panicking during market downturns. “Even though it’s nerve-racking and nail-biting, staying invested pays off,” he said, adding that over his career, he’s watched investors repeatedly miss major recoveries because they sold at the worst possible time.
This year’s market action underscores his point. The S&P 500 has surged roughly 27% from its April 8 low, and sits about 12% above its pre-slump level far surpassing the market’s historical average annual return of about 7%.
The recovery, O’Leary argues, comes down to “clarity” over tariffs. Rates have proven less severe than many feared, with some major trading partners like the EU facing levies of just 10% to 15%. The current range spans from 10% for the UK to 41% for Syria.
“I would have expected to see evidence by now if tariffs were going to reignite inflation or cause a recession,” O’Leary said. Instead, inflation has remained tame, with the Consumer Price Index rising only 0.2% in April, 0.1% in May, and 0.3% in June on a seasonally adjusted basis.
The feared scenario of “input costs killing gross margin” hasn’t materialized, he added. And with U.S. consumers still spending and the economy showing resilience, O’Leary sees reasons for optimism.
“It’s a remarkable situation,” he said. “Basically, everybody got it wrong” on the impact of tariffs.
Looking Ahead: Bullish Into the Holidays
O’Leary’s business operations are acting on that optimism. He and his managers are stocking up for what they expect will be a strong holiday shopping season.
“So that gives you some indication,” he said. “We’re net bullish.”
From his vantage point, the dual narratives dominating the market the potential of AI and the risks of trade policy are both tilting toward opportunity rather than danger. For O’Leary, the data speaks louder than the headlines: AI is already saving companies money, tariffs haven’t derailed growth, and for investors willing to weather short-term volatility, the long game still looks strong.
