Shlomo Kramer runs cybersecurity company Cato Networks. Shlomo Kramer Cato Networks CEO Shlomo Kramer says we're experiencing an AI bubble. Kramer said the level of investment and AI-driven profit improvements are driving the bubble. He warns that market prices are unsustainable and expects the bubble to unwind. The CEO of cybersecurity company Cato Networks may have just validated the fears of many: that the dot-com era could be repeating itself. "We are in a bubble," Shlomo Kramer, who runs the company aimed at securing organizations' digital and AI transformation, told Business Insider. Kramer said the bubble is fueled by both the high level of investment and early profit gains from AI, which he said are encouraging companies to keep investing fast enough to hold market prices up, despite what he described as a growing disconnect between valuations and reality. "There's a dislocation there; it's big and it's going to unwind," Kramer said. The CEO said that while he "absolutely" believes in AI and its capabilities, the question remains about whether the investments are matching the rate of that return. "It's going to happen at a much slower pace than right now," Kramer said, about the advancements of AI. The CEO said if he could assess AI in every department of an organization that he knows, the takeaway would be: "not yet." For example, Kramer said that AI can bring value in areas like customer support, but it can't replace it. It may be able to replace the first level of support, but that isn't where companies face the highest cost, he said. "It's simply not there yet," Kramer said. The CEO similarly said that he sees AI boosting engineering capabilities down the line, but for now, its impact is "modest." He said AI may be able to increase effectiveness and productivity to them in specific areas or situations, but it can't replace engineers. Kramer said he's not seeing companies cutting back on engineers or firing them because of AI — even if they've claimed that's what they're doing. "I highly suspect that all these companies that said that they are firing engineers because they now have AI actually used AI as a cover story," Kramer said. While there has been some indication that entry-level engineering roles are on the decline, many companies have continued to hire engineers amid the AI boom, and some firms, like Cloudflare, have expanded their internship programs. Kramer is the latest CEO to weigh in on the debate about an AI bubble. While the current investment landscape shares some similarities to that of the dot-com era, some execs think that we're in a different situation today because AI has shown more of an impact in the past few years. Industry leaders are split on the topic. The CEO of Nvidia, the chipmaker that's fueling the AI revolution, has denied the existence of an AI bubble, while Mark Zuckerberg has said the bigger risk is not spending enough. Meanwhile, OpenAI's Sam Altman, who led the AI takeoff with the launch of ChatGPT, and frequently champions the technology, has said investors are "overexcited about AI." Even with a solid ChatGPT prompt, there's no crystal ball to know exactly how this will end. Read the original article on Business Insider