Apollo’s Zelter Urges Caution Amid ‘Massive’ Investments in AI

Apollo Global Management Inc. President Jim Zelter warned that the rush of capital into artificial intelligence and data centers is fueling high valuations and increasing risk for investors.

“Whenever you see massive impulse and infusion of capital into a sector” such as AI “you have to think about debt and equity returns on invested capital,” Zelter said Wednesday on Bloomberg TV, in response to a question about whether it’s necessary to hedge exposure to data centers.

Financing these data centers is fundamentally different from funding other technology projects, Zelter said. And understanding those nuances will separate winners from losers, he ...