Executive Summary
The tech industry faces a severe financial crisis driven by unsustainable AI spending. Layoffs result from declining free cash flow and potential insolvency, not AI efficiency. Giant models are proving too expensive to maintain, while revenue fails to match soaring infrastructure costs. The market is shifting toward small, specialist models that run on local hardware. Nvidia’s rising inventory suggests a wave of cancellations that could soon destabilize the entire global tech supply chain.
