Key takeaways
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- AI capex continues: 68% of CEOs plan to increase AI spending in 2026, even though fewer than half say current AI projects have produced positive returns.
- Where AI is “working” vs. stalling: CEOs report the best outcomes in marketing and customer service, with more difficulty in security, legal, and HR use cases.
- Expectation gap: 53% of institutional investors expect AI ROI within 6 months, while 84% of $10B+ revenue CEOs think ROI will take longer than 6 months.
- Surprising labor signal: 67% of CEOs think AI will increase entry-level headcount, and 58% think it will increase senior leadership headcount.
What Happened?
Teneo’s annual survey of 350+ public-company CEOs found that most executives plan to increase AI investment in 2026, despite many AI projects not yet paying for themselves. CEOs cited stronger traction in customer-facing functions like marketing and service, but reported challenges implementing AI in higher-risk corporate domains such as security, legal, and HR. Teneo also surveyed ~400 institutional investors, revealing a notable mismatch in how quickly each group expects AI investments to generate returns.
Why It Matters?
This suggests AI spending is shifting from “optional innovation” to a competitive necessity—companies are investing to avoid falling behind even without clear near-term ROI. For investors, the key signal is not the magnitude of spend, but the quality and monetization of that spend: industries and firms with clearer paths to revenue uplift or cost reduction may outperform as markets start demanding proof. The expectation gap between CEOs and investors also increases the risk of valuation volatility if ROI timelines slip or if companies can’t translate pilots into scaled, auditable benefits—especially in regulated/high-risk functions where deployment is harder and failure costs are higher.
What’s Next?
Watch for 2026 to become a “show-me” year where management teams are pressured to quantify AI impact in earnings calls through measurable KPIs (productivity, conversion, churn, unit costs). Also monitor which functions move from experimentation to scaled deployment—particularly whether companies can safely expand AI beyond marketing/service into security, legal, and HR. Separately, the survey flags broader corporate posture: CEO optimism on the global economy has softened for large firms, while expectations for higher M&A activity in 2026 remain high—suggesting AI-driven capability acquisition and consolidation could accelerate.
