AI "hot takes" are becoming a market risk
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Illustration: Brendan Lynch/Axios
Companies across sectors are confronting an increasingly unavoidable narrative: AI can replicate your business.
Why it matters: Narrative volatility is a new risk category that communications teams must prepare for in the age of AI.
- All it takes is one widely read doomsday essay, research paper or X thread to knock billions off a company's market cap.
Case in point: A viral 7,000-word memo that warned of a hypothetical AI future — in which companies rush to replace human workers with AI tools that themselves are rapidly commoditized — sent markets tumbling.
- Meanwhile, essays from AI founders and researchers are shaping investor psychology, and product rollouts from AI giants like Anthropic are being treated as existential threats to companies in the software or cybersecurity sectors.
State of play: This week was particularly volatile. IBM shares plunged 13% after Anthropic's legacy code announcement.
- Stocks of companies that were mentioned in the doomsday memo — like DoorDash, American Express, Uber and Mastercard — all fell by 4% or more.
Reality check: Regardless of the facts, if the narrative sticks (even temporarily) it can move stock prices, trigger activist questions, spook employees, invite political scrutiny and potentially shift consumer behavior.
- This is why communication experts say companies cannot afford to be slow to respond.
By the numbers: Fortune 500 CEOs view AI and "new technology" as the top risk to their industry, per a new Conference Board survey.
- This is a shift, given that in 2025, geopolitical issues were the top concern (59%), followed by "cyber" (56%).
Zoom in: Companies must define their role in the AI era before an external voice or viral X thread does. This requires two talk tracks:
- How AI strengthens the business by improving margins, speed, product quality or customer experience, and explaining how management is thoughtfully integrating it.
- Why the company remains indispensable due to human judgment, expertise, relationships, proprietary data, brand credibility, physical infrastructure or products AI cannot easily replicate.
What they're saying: Vague claims of AI capabilities won't calm markets. The key is specificity, says Adam Mendelsohn, CEO of strategic advisory firm Upland Workshop.
- "Every communications professional has to have a really clear and detailed way of articulating how their company is going to manage AI," he said. "And I think for publicly traded companies, they should be spending a lot of time right now educating analysts, educating buy-side, about their unique ability to manage AI."
- "You should be thinking defensively now, because when these narratives take hold, they become industry-wide. And the question is, have you put yourself in a position to separate yourself from your contemporaries or your competitors?"
Zoom out: Reputation is increasingly intertwined with valuation, according to a recent Burson analysis.
- Companies with the strongest reputations earn nearly 5% more in unexpected shareholder returns than their counterparts.
What to watch: AI companies themselves aren't in the clear when it comes to reputation.
- A majority of Americans — 58% — don't trust AI much or at all, a recent The Economist/YouGov poll found, while 77% of Americans say they are concerned AI could pose a threat to humanity.
- Plus, concerns about AI's impact on jobs, safety, privacy and energy continue to percolate.
💭 Thought bubble from Axios senior AI reporter Madison Mills: Substacks are the new short seller report in an environment where all the major banks are competing to land big AI IPOs.
- Broadly, analysts have not been as forthcoming about any concerns they have on the AI trade.
- Paul Kedrosky, a venture capitalist, tells Axios that's because banks want to remain in favor with AI firms so they can handle their IPOs and other deals.
- Enter independent authors: their takedowns feel like clarity to investors who are steeped in uncertainty about AI's path forward. It's narrative roulette on Wall Street.
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