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AI companies continue to pour hundreds of billions of dollars<\/a> into enormous infrastructure projects, fully expecting demand for their services to spike in the coming years to justify their outsize investments.<\/p>\n Reality, however, continues to have a lot of catching up to do. Revenues are still being dwarfed by astronomical capital expenditures as the gulf between the tech industry\u2019s lofty promises of an AI utopia<\/a> and what the tech is actually capable of today continues to grow. And persistent fears over an AI bubble that could wreck the entire US economy<\/a> if it were to collapse continue to nag Silicon Valley investors and analysts.<\/p>\n Bill Gurley, a venture capitalist and general partner at the financial services company Benchmark, warns that the industry is still in for a rude awakening \u2014 a hard \u201creset\u201d that could hit markets hard.<\/p>\n \u201cOne day we\u2019re going to have an AI reset, because waves create bubbles, because interlopers come in,\u201d he told CNBC<\/a> on Monday. \u201cWhen people get rich quick, a whole bunch of people come in and want to get rich too, and that\u2019s why we end up with bubbles.\u201d<\/p>\n \u201cOne day, I just think we trip and run out of money on those things,\u201d he added. \u201cI do think that moment stands in front of us.\u201d<\/p>\n As AI companies continue on their unprecedented spending spree, it could soon become difficult to turn things around and become profitable once many billions of dollars in debt.<\/p>\n \u201cI just think it\u2019s harder to land the plane,\u201d he said.<\/p>\n Gurley is far from alone in warning of an imminent AI bubble collapse. Investors have warned of a \u201creckoning<\/a>\u201d at which point the winners and losers could finally emerge.<\/p>\n Former Goldman Sachs head Lloyd Blankfein, who oversaw the bank through the subprime mortgage crisis, similarly warned earlier this month<\/a> that it\u2019s time to start preparing for a major jolt to the system reminiscent of the 2008 one.<\/p>\n Not everybody sees a bubble collapse as a negative outcome. Some of the wealthiest business figures in the world argue it\u2019s simply a price to pay<\/a> in the name of technological progress, as The Atlantic reported<\/a> last week.<\/p>\n One major inflection point: numerous major players in the AI industry are looking to go public this year, from OpenAI to Anthropic, in a major test that could finally blow the fuse. Elon Musk\u2019s SpaceX, in particular, which acquired the mercurial CEO\u2019s AI startup xAI earlier this year, is expected to go public at an unprecedented valuation of $1.4 trillion.<\/p>\n One thing\u2019s for sure: the stakes are huge. Tech companies have committed to spending $650 billion on AI this year alone, accounting for a rising share of economic activity in the US. If something like Gurley\u2019s reset were to occur, it could be a boon for the winners and disastrous for the losers \u2014 a high-stakes gamble that investors are clearly hooked on.<\/p>\n