Key Takeaways
\nMorgan Stanley estimates AI adoption could translate into annual net benefits of some $920 billion for S&P 500 companies, though it could take years to achieve and there is substantial risk that the benefits won’t be fully realized.AI could address shortfalls in the labor market “rather than killing jobs,” according to Morgan Stanley.Wells Fargo economists say the “high-tech” category currently accounts for a modest portion of U.S. manufacturing, but is poised to expand.<\/p>\n
Artificial intelligence giveth and taketh away, but it might be more of the former than the latter.\n<\/p>\n
Morgan Stanley estimates the annual net economic benefit in AI adoption alone could lead to roughly $920 billion, or about 28% of S&P 500 estimated consensus pretax earnings for 2026, after implementation costs. That would translate into $13 trillion to $16 trillion in market value creation. The firm’s analysts note, however, that it would take many years to achieve, with substantial risk of companies not realizing the benefits of full adoption.\n<\/p>\n
That economic value creation is expected to come from a mix of cost cutting as well as new revenue and margin generation, Morgan Stanley strategists including Stephen Byrd wrote in the report. The value is expected to come from an almost even split between agentic AI, or software, and embodied AI, human-like robots.\n<\/p>\n
Adoption of new technology, including artificial intelligence<\/a>, could be a net positive for the job market, contrary to fears of becoming obsolete<\/a>, or FOBO, per analysts and economists.\n<\/p>\n