Big companies are pulling the plug on AI projects because they can be sued for what the software makes up, which is bad news for the trillion-dollar tech firms betting everything on the AI buildout.

• Big Tech is spending $725 billion this year on AI, but the whole AI services business made only about $25 billion — the money going out dwarfs the money coming in.
• After a court ruled Air Canada was on the hook for a lie its chatbot told a customer, companies realized they own whatever their AI says, and insurers are now refusing to cover AI mistakes.
• Nearly half of new company AI projects are being scrapped before launch, and most firms using AI can't point to any real boost to profits.
• These bets are being funded with borrowed money — the five biggest tech firms issued over $100 billion in new debt, and cash meant for stock buybacks is being redirected to pay for data centers.
• The Nvidia chips at the center of it all are losing value fast, with rental prices down sharply and cheaper Chinese AI models undercutting the whole "compute is scarce" story.

Outlook: Expect more cancelled projects and stalled data centers as the huge spending keeps outrunning the profits AI actually delivers.