His point isn't that Google or Meta are doing well or have bright futures. Luu is generally critical of tech giant engineering and product culture. He's critical of Google in particular in this very article.
But the point of the article is that it's not enough to have directionally satisfying vibes. If you made concrete forward-looking predictions and they're catastrophically wrong, that matters. If you make backwards-looking predictions that were literally wrong the moment you published them, that matters even more.
"Did you read the article" is a frowned-upon response on HN. The better way to write that kind of response, per the guidelines, is "the article mentions that". So: the article mentions that.
> it's not enough
It's enough for some of us, like his broad predictions that work on timescale of business cycles seem directionally correct. Even considering we're dealing with fast hardware deprecation cycles it will take years to play out especially with investors and incumbents burning through accumulated war chest. Luu seem oblivious to notion that companies with trillions in market cap can certainly out manipulate fundamental short / medium term market sanity. Part of Zitron's rant I find similarly compelling is the danger of dismissing directionally "satisfying" vibes because $$$ can capture reporting distort reality, which is only going to lead to bigger/more painful correction because directionally "correct" was dismissed as merely directionally "satisfying."
If my cousin kept ranting about my other cousin was going to go bankrupt and fail and it was 3 years later and their income was up 2x I think I’d stop listening.
I worked at Google from 2016 to 2022 and agree with everything he says and you say, modulo the companies who are 2-3x on revenue and profits are going to 0. I worry that both of you have found a real problem but misattributed it, and insisting emotional arguments are the same as rational prevents you from participating in real fixes (ex. metas problem isn’t AI, it’s that they have a god-king CEO who cannot be deposed and monopoly profits. Imagine a twin of you and Zitron but instead of AI it’s 2020-era VR. If they weren’t focused on how their emotional argument was fine, they’d be your compatriots in noticing something’s off in Big Tech. Instead, we don’t hear about them because that battle was fought and lost years ago, and they lost credibility due to imagining Meta was going to 0)
He is not, though. He precisely points to imprecise predictions, decontextualize them so he misses the point of the ones this thread is focused on, analyzes them with even less precise rationales that don't really rebut the prediction, and points suggestively (enough that you seem to have got that suggestion) that this rebuttal destroys the main prediction of every Zitron piece, while saying otherwise several times at the end of the rationale.
Zitron's predictions aren't all very good, but this article isn't either.
But Zitron isn't just blogging about how we're in a bubble. The assertions he makes are not minutiae, he basically continuously says that all the big SW firms are walking corpses. He's not having a rational conversation about the long term prospects for companies who invest in AI. There is a population of people who (rightfully) hate Google et al and want them to fail, and he just stokes their anger and frustration.
He doesn't add anything substantial, and (as the article indicates), even when he brings economic figures into the conversation, he's frequently wrong or misrepresents them.
You think we are in a bubble and that AI won't pay off for the companies investing in it.
While I'm sure there will be companies that invest badly the problem with your prediction is that the public hyperscalers (Google, Amazon and MS especially) are already seeing returns from their AI investments.
Look at the revenue growth - that is actual dollars coming through the door.
...huh? How is it "not rational"? He's saying that, based on the financial information available, it appears AI doesn't actually make very much money given the capital investments. To the point that there may never be AI ROI.
I'm not sure how much this or that "prediction" matters. His arguments would be just as strong without them, perhaps stronger because they wouldn't give folks like Luu something to snipe at.At this juncture, the analysis seems sound. AI costs an absolute fortune and appears to make very little money, comparatively.
Is that irrational? IDGI. One needs look no further than Oracle to see a company in dire financial straits.
Oracle had record revenue and profit in the most recent quarter.
That's quite a long way from "dire financial straits"
https://www.theregister.com/ai-and-ml/2026/07/01/oracle-outl...
It seems like the author of this piece hasn't.
He says:
> Stock market bettors aren't sure they like these odds. The company's stock is down more than 40 percent in the last month
The stock is down because of the increased interest load and the impact of that in the next couple of quarters, not because of doubts over Oracle's viability.
If there were significant doubts over its viability it would be down a lot more than 40%!
- They've all been compelled to build the same horribly expensive AI infra, to serve similar models that have no ability to lock-in customers
- Google Search has to compete with LLMs
- Meta hasn't demonstrated a credible argument on how they're planning to use AI. AI 'friends' would kill their business model. Their saving grace ironically is that people absolutely hate interacting with AIs. Same goes for other AI assistants.
- Hyperscalers have to compete for the same hardware as AI companies, driving their costs up
- AI turned out to be excellent at both porting software to more optimized stacks and deleting the 'prestige' of building these ultra-inefficient microservice containerized stuff. I haven't read a single article about somebody bragging about this stuff. When it comes to tech (which is not AI), usually its about Zig, Rust and going native.
- So if customers really start feeling the heat of rising costs, they have a realistic path of optimizing their compute usage by using AI to rewrite the worst-offending components. I think one of the few things in which AI has demonstrated measurable economic value is rewriting software in Rust to be more efficient
Emphasis added, since having a horribly expensive AI infra allows offering enterprise contracts, which is a form of lock-in and has been pretty lucrative for GCP/Azure/AWS.
No. Net income is up quite a bit and profit margins maintained at Microsoft, Amazon, Alphabet, and Amazon. Meta net income is flat, but they are maintaining profit margins.
We'll see when they go public. Until then all these press releases are strategic messaging...
Of course not, but private investors get to see their books and investors are lining up to invest.