Tech CEOs are apparently suffering from AI psychosis
The tech industry is experiencing significant changes, with CEOs reportedly suffering from what is termed 'AI psychosis.' This phenomenon is characterized by executives believing in the capabilities of AI without fully understanding the complexities involved in its implementation. Despite the enthusiasm for AI, many layoffs in the sector are attributed to misguided beliefs about its productivity benefits.
- ▪Tech CEOs are said to be suffering from delusions of grandeur regarding AI capabilities.
- ▪In 2026, the tech industry has seen nearly as many layoffs as in all of 2025, with over 115,000 people let go.
- ▪Many companies cite AI as a reason for job cuts, leading to accusations of 'AI washing' in the industry.
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There is a certain wildness in the tech industry these days that both mimics previous eras of large changes, like cloud computing (runaway costs in the early days), and is like nothing we’ve ever seen before (record revenues accompanied by mass layoffs). A theory doing the rounds attempts to explain the phenomenon: Tech executives, especially CEOs, are collectively suffering from delusions of grandeur thanks to AI. And at least one tech CEO has said so out loud: Box founder Aaron Levie. “CEOs are uniquely prone to AI psychosis because they’re sufficiently distant from the last mile of work that still has to happen to generate most value with AI,” Levie wrote on X.
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