Recently, many AI-related companies have seen voracious optimism and spikes in valuations. In August, the OpenAI CEO told reporters the AI market was in a bubble. When bubbles happen, “smart people get overexcited about a kernel of truth,” Altman warned, drawing parallels with the dot-com boom. Still, he said his personal belief is “on the whole, this would be a huge net win for the economy.”

Now Bezos too is saying an AI bubble exists, and has an even more positive outlook.

The similarity between this bubble and the dot-com bubble in the late 1990s worries investors and comes with high financial risks. But Bezos said the difference in nature of the current AI bubble should provide investors some solace.

“This is a kind of industrial bubble, as opposed to financial bubbles,” he said at Italian Tech Week on Friday.

Ultimately, industrial bubbles can be positive, Bezos added, pointing out that the biotech and pharmaceutical bubble in the 1990s led to the development of life-saving drugs—though in the process, many public companies that IPO’d during the boom went bankrupt or were acquired at a fraction of their starting value by the end. The cumulative net losses to public biotech companies’ bottom lines piled up to more than $40 billion, The Wall Street Journal reported in 2004.

But, Bezos said industrial bubbles are “not nearly as bad” as other bubbles, like

“It can even be good, because when the dust settles and you see who are the winners, societies benefit from those investors,” Bezos said. “That is what is going to happen here too. This is real, the benefits to society from AI are going to be gigantic.”

And during bubbles, everything gets funded, he noted. When these periods of excitement come along, investors have a hard time distinguishing the good ideas from the bad, he said, adding this is “probably happening today” with AI investments.

Meta CEO Mark Zuckerberg recently made similar comments, saying an AI bubble is possible but that he would rather see his company “misspend a couple hundred billion dollars” than be late to superintelligence.

But whether AI is in a bubble or not is separate from its transformative potential, Bezos pointed out: “That doesn’t mean anything that is happening isn’t real. AI is real, and it is going to change every industry.”