Goldman CEO Solomon sees AI boosting his firm's capacity to grow

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Looking at publicly traded tech companies and private capital formation in the sector, "there's no question we're somewhere in a cycle where the values are higher, but the growth opportunity coming from AI is significant," said Goldman Sachs (NYSE:GS [https://seekingalpha.com/symbol/GS]) Chairman and CEO in a televised interview.

That doesn't mean every tech company focusing on artificial intelligence will prosper. "I'm certainly in the camp that there's going to be winners and losers," he said during an interview on CNBC's "Squawk Box" program, noting that some capital will be allocated to companies that fail.

"Ultimately, there's a rebalancing," he said. "But I think the long-term trends around this technology, the opportunity for productivity gains, for some great companies to be formed is really quite exciting."

As for AI's role at Goldman (NYSE:GS [https://seekingalpha.com/symbol/GS]), Solomon points out that the firm's approach has always been to "get technology tools into the hands of really smart people to make them more productive."

He sees the technology revving up the firm's One Goldman Sachs initiative to drive efficiency improvement. "This technology gives us the right and the ability for the first time to re-imagine these processes and really do them entirely differently to automate a bunch of things to create meaningful efficiency that can then be reinvested in growth in the business," he said. "It's giving us more capacity to invest in our business and grow."

In January, the company will talk more specifically about how it can affect the business, he added.

But Goldman Sachs's (GS [https://seekingalpha.com/symbol/GS]) investment in AI won't be limitless. "I still feel some constraints — because we've got to deliver returns — as to how much we can invest to grow our business," Solomon said.

Like many other technologies, AI will affect staffing levels."Technology has been having an impact on headcount — the way people work, what workers you have — for decades and decades and decades," Solomon said. "I think one of the things happening here that's a little different, this is going at a pace that's quicker. And because the pace is so quick, I think there's a possibility that there's a little bit more volatility, or an unsettled transition, around certain job functions and things like that."

In summing up his view on AI use at Goldman, he said, "I'm excited about it. If you take a three- to five-year view, it's giving us more capacity to invest in our business."

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