Key Findings

  • CEOs named artificial intelligence as their top risk for the first time, surpassing geopolitical turmoil, cyber intrusions, and financial and economic instability, the Conference Board said on Thursday.
  • The Conference Board's quarterly survey found that the share of CEOs planning to increase capital expenditures jumped to 35% from 22% in the previous quarter as they confront the challenges posed by AI. At the same time, theirconfidence rose to its highest level since the first quarter of 2025。
  • The improvement in CEO confidence indicates that "large business leaders are regaining optimism," Dana Peterson, chief economist at the Conference Board, said in a statement. "CEOs' expectations for their own industries improved further, shifting from cautious to firmly confident," she said.

In-Depth Analysis

CEOs, CFOs, and their executive teams face a dual risk from AI: underinvesting in emerging technologies could leave them behind bolder competitors, while overinvesting could lead to poor returns, missed performance targets, and investor dissatisfaction.

"AI's potential is enormous," Federal Reserve Governor Lisa Cook said on Tuesday. "That said, I am cautious about its widespread adoption," she said in a speech.

"The emergence of AI will serve as the latest example of the creative destruction that economist Joseph Schumpeter described nearly a century ago," Cook said, adding that "we appear to be approaching the most significant reorganization of work in generations."

Cook noted that while AI spurs innovation and creates new business opportunities,it may also bring costs。

"Job losses may precede job creation, and as the economy transitions, unemployment could rise and labor force participation could fall," Cook said. "This outcome could create hardships for many workers and their families."

In manufacturing, AI may follow the pattern of electrification from over a century ago, delivering substantial returns more slowly than expected, Federal Reserve Governor Michael Barr said.

"Within firms, there is evidence in manufacturing that productivity follows a J-curve after technology adoption: adjustment costs lead to short-term losses, after which firms that persist achieve greater long-term gains,"Barr said in a speech on February 17。

Sixty percent of CEOs at Fortune 500 companies listed AI as a major risk to their industries, up seven percentage points from the fourth quarter of 2025, the Conference Board said.

AI's perceived risk surpassed geopolitical instability and cyber risk by margins of 1 percentage point and 4 percentage points, respectively, the Conference Board said.

Seventy-one percent of CEOs said tariffs imposed by the Trump administration have raised their companies' costs, the Conference Board said.

According to Conference Board data, 44% of CEOs have passed tariff costs on to customers or plan to do so, while 27% of CEOs' companies have absorbed the import tax costs, squeezing profits.