It is time to get my crystal ball out again and make some predictions for the year ahead.

• It’s that time of year again, when I make some predictions about the year ahead.
• The usual disclaimer applies however that this is not investment advice, it’s just for fun!
• But before we begin to look at 2026, let’s look at my previous results for 2025 and see how many I got right.
• This year I am doing something different: instead of scoring myself, I have used Google Gemini to score these for me and provide some supporting information for each grade.
• So let’s get started on reviewing my 2025 predictions:
  1. America first.
  • The Donald Trump election victory marks a return to insular foreign policies and protectionism.
  • Ireland will be impacted if corporation tax is reduced in the US.
  • Google Gemini feedback: “Score: Pass The prediction of a Donald Trump victory and a return to protectionism was accurate. Following his inauguration, the administration moved quickly to implement the "America First" agenda, introducing significant tariffs (including a 15% ceiling mentioned in trade disputes) that disrupted global trade dynamics. Regarding Ireland, while corporation tax receipts actually rose in 2025 (up ~15% year-on-year) due to pharmaceutical companies frontloading exports to beat new tariffs, the country was undeniably "impacted." The economic discourse in Dublin throughout 2025 was dominated by the threat of US policy shifts, with reports from the Irish Fiscal Advisory Council highlighting long-term risks to foreign direct investment (FDI) and a potential 2% hit to employment by 2030. The "impact" was immediate uncertainty and strategic shifting, even if the revenue collapse hasn't happened yet.”
  2. The Empire strikes back.
  • DOGE efforts will run aground when unions and other employee legislations prevent mass lay-offs. Ref: https://en.wikipedia.org/wiki/Department_of_Government_Efficiency
  • The "Deep State" civil service is too entrenched to be unravelled in a single term.
  • I suspect these efforts will get bogged down next year.
  • Google Gemini feedback: “Score: Pass Your forecast for the Department of Government Efficiency (DOGE) was spot on. Despite high-profile launches and Elon Musk’s involvement, the initiative effectively "ran aground" by mid-2025. Musk himself announced plans to pivot away from the project in May 2025, and the department was officially dissolved/declared non-existent by November 2025. As you predicted, the "Deep State" and labor protections proved formidable; massive planned layoffs (e.g., 55,000 positions) were bogged down by lawsuits, union opposition, and court challenges that saw many fired workers rehired. The bureaucracy proved too entrenched to be dismantled in the aggressive timeline proposed.”
  3. AGI will continue to disappoint.
  • I recorded an episode previously about the lack of a "Moore's Law" for AI (ref: https://techleader.pro/a/658-There-is-no-Moore's-Law-for-AI-(TLP-2024w35)), and how OpenAI model growth is already slowing down.
  • "AGI is near" is the new "Singularity is near".
  • While recent growth in generative AI has been remarkable, we are still decades out from AGI.
  • Google Gemini feedback: “Score: Pass The AI industry effectively hit the "reality check" you predicted. 2025 is now being described by tech analysts as a year of "stumbling agents" rather than superintelligence. OpenAI specifically struggled to maintain its dominance, with reports from late 2025 describing the company as "scrambling" and "failing" to release models that lived up to the hype, while competitors like Google's Gemini 3 overtook them on benchmarks. The "Moore's Law for AI" did not hold; developers reported that AI tools were actually slowing them down in complex tasks, and the narrative shifted from "AGI is imminent" to a recognition that reliable autonomous agents are still years, if not decades, away.”
  4. Woke media is dead.
  • The final sting of a dying bee.
  • Most people want to be entertained, not preached to.
  • They are voting with their pockets.
  • I expected large gaming and Hollywood companies to pivot back to their historical center grounds next year.
  • Google Gemini feedback: “Score: Pass This was perhaps the most visibly confirmed prediction of the year. Disney, the bellwether for this trend, explicitly reversed course in early 2025. In a move that shocked the industry, they dropped "DEI" and "Diversity" terms from their annual report for the first time since 2019, dissolved their "Reimagine Tomorrow" initiative, and even restored original content warnings to classic films rather than censoring them. The gaming industry followed suit, with studios pivoting away from DEI consultants amidst a "vociferous" consumer pushback and significant job losses (over 5,000 in the sector) that forced a focus on profitability and core entertainment over messaging.”
  5. The EU will continue to swing Right.
  • Immigration policies and a lack of policing is spurring the growth of ring-wing parties across the EU.
  • The Left offer no solutions to these problems, but offer more of the same.
  • Across the EU several incumbent government parties at at risk, look to Germany first, then France.
  • Google Gemini feedback: “Score: Pass The political landscape of Europe shifted decisively to the Right in 2025. In Germany, the September federal elections resulted in a crushing defeat for Olaf Scholz’s SPD (their worst result since 1887) and a victory for the CDU/CSU, with the far-right AfD doubling its vote share to over 20% and becoming the dominant force in eastern states. In France, the government remained in a state of perpetual crisis; Prime Minister François Bayrou was ousted in a no-confidence vote in September 2025—the fifth government collapse in two years—as Macron’s centrist minority failed to hold back the pressure from the National Rally. The "incumbents at risk" prediction was fully realized, with the center failing to hold and immigration/security concerns driving voter sentiment.”
• So according to Google Gemini, I scored 100% on my predictions for 2025, not bad!
• And now onto 2026, here are my predictions for the year ahead:
  1. AI investment will slow down.
  • Too much money is being invested in AI, the returns do not justify the amounts being invested.
  • For example, based on reports as of December 30, 2025, OpenAI raised approximately $40 billion in new investment capital during 2025.
  • In contrast OpenAI generated approximately $13 billion to $14 billion in total revenue during 2025. This was widely considered a strong year for them.
  • In spite of revenue growth, the company reportedly burned through approximately $8.5 billion in cash during 2025. They remain unprofitable.
  • That $40 billion they raised? That was their series F. If we take all previous rounds, they have raised approximately $58 billion in total equity funding to date.
  • Best case: those investors will not see a return for decades.
  • Sorry but I do not believe the hype around AGI, despite remaining bullish about AI overall. There is too much heat in this market, it needs a correction.
  2. AI prompts will run paid ads alongside results.
  • I love Google Gemini now, it is my daily AI assistant for dozens of use cases.
  • While I pay a small fee for it, I suspect is not enough to cover my usage in terms of storage and compute costs for Google.
  • The absence of ads on Gemini is refreshing, given that Google’s primary revenue source is ads run across all of their other platforms like Google Search and YouTube.
  • I suspect that situation won’t last, indeed as we collectively pivot from classic search engines to AI prompts for Internet search, the shortfall in search-based ad revenue will have to be addressed elsewhere on AI platforms.
  • For context as of late 2025, Google's advertising revenue for the year is projected to reach approximately $296.2 billion.
  • Google is an ad company that pretends to be a search company.
  • This is not only true for Google however: expect to see more ads in your favourite AI prompt interfaces in the near future.
  • Meanwhile Google have already started to include ads in their AI Overviews in search results for example, which has added to their ad revenue growth this year.
  • Building, training, and hosting large AI models in the cloud is seriously expensive. Those costs need to be covered by customers: right now they are being subsidized by investors in the case of OpenAI, or ad revenue from other sources in the case of Google.
  3. A sharp decline of EV sales
  • Approximately 18.5 million EVs were sold globally by November 2025.
  • China remains the dominant force, driving the vast majority of this volume.
  • In the EU sales are increasing (but this is largely due to regulations rather than actual demand), while in the US sales have stalled.
  • US sales have flattened or dropped (down ~1–2%). This is largely due to the expiration of federal tax credits, policy uncertainty under the new administration, and charging infrastructure gaps.
  • Spot a trend here?
  • In highly-regulated markets like China, and to a lesser extent the EU, EV sales are increasing.
  • In the low-regulated US market, where demand is driven by market factors rather than regulation, demand is softening.
  • My belief is that market forces will win out in all regions eventually, and EVs will remain a minority of car sales.
  • Some EU manufacturers have been badly burned by the regulatory push towards EV rollouts.
  • For example, Mercedes-Benz originally committed €40 billion (approx. $47 billion) specifically for the period between 2022 and 2030 to transition to an "electric-only" future.
  • However, in a major strategic pivot in 2024/2025, they announced they would continue investing significantly in combustion engines, diverting some funds back to "high-tech combustion" to keep their gas and hybrid models viable well into the 2030s.
  • Mercedes originally aimed for 50% of their sales to be EV/Hybrid by 2025. The reality in late 2025 is that EVs make up only about 21% of their total volume.
  • Historically, Mercedes enjoyed double-digit profit margins (around 12–14%). Because EVs are so expensive to build and required heavy discounting to sell, their margins have slipped to ~8%, alarming investors.
  • I expect this profit margin bleeding to continue well into 2026.
  4. Local AI models will bloom.
  • As the push towards Agentic AI heats up in 2026, namely AI that has agency to act on your behalf rather than simply giving you advice in a chat session, I hope to see these agents leave the cloud and move into edge devices.
  • I am encouraged to see the growth of the “128 Gig PC”, which are overpowered PCs capable of running larger models on local hardware.
  • Many of these devices are running on mini-PC designs that are low-powered and quiet, making them ideal for edge deployments of models in the field.
  • This is an exciting trend for me, I hope it continues!
  5. The energy crunch in Germany will have political consequences.
  • While no longer the absolute highest in the world, Germany’s electricity prices remain among the most expensive globally, currently ranking roughly 5th highest for households and 2nd among G20 nations.
  • To maintain competitiveness, the German government launched a massive subsidy program on January 1, 2026, aimed at capping industrial prices at 5 cents per kWh for energy-intensive sectors and halving grid fees.
  • High energy costs have caused "structural scars," leading to stagnant GDP growth and "creeping deindustrialization," as major companies in the chemical and steel sectors shift production to lower-cost regions like the U.S. and Asia.
  • Energy policy has become a major "culture war" issue, contributing to the shift in leadership toward the center-right CDU in the 2025 elections and fuelling the rise of populist parties like the AfD.
  • Domestic critics focus on the controversial 2023 nuclear phase-out, which many view as a "self-inflicted wound" that tightened supply, and the high taxes/levies required to fund the green energy transition.
  • High costs have led to "transition fatigue" among the public, with an estimated 7 million households facing energy poverty, creating intense pressure on the new administration to deliver visible relief on monthly utility bills.
  • So there you have it, my predictions for 2026. Let’s check back this time next year so see how I done, and remember it’s just for fun!

Sources

2025:

Disney ditches 'diversity' and 'DEI' in business report for the first time since 2019 - https://www.foxbusiness.com/media/disney-ditches-diversity-dei-business-report-first-time-since-2019

Department of Government Efficiency - Wikipedia - https://en.wikipedia.org/wiki/Department_of_Government_Efficiency

2025 marked the beginning of the end for OpenAI | IT Pro - https://www.itpro.com/technology/artificial-intelligence/2025-marked-the-beginning-of-the-end-for-openai

Corporation tax strong to end-November, alongside continued investment in public services and infrastructure - https://www.gov.ie/en/department-of-finance/press-releases/corporation-tax-strong-to-end-november-alongside-continued-investment-in-public-services-and-infrastructure-t%C3%A1naiste-simon-harris-minister-jack-chambers/

YEAR-ENDER - 2025: How far-right AfD surged to the top of German polls - https://www.aa.com.tr/en/europe/year-ender-2025-how-far-right-afd-surged-to-the-top-of-german-polls/3781801

We still don’t really know what Elon Musk’s Doge actually did - https://www.theguardian.com/technology/2025/dec/30/elon-musk-doge-impact-us-government

GPT-4.5 Orion: OpenAI's Biggest AI Flop? - https://startuphakk.com/gpt-4-5-orion-openais-biggest-flop-why-the-ai-scaling-hype-might-be-over/

2026:

Alphabet Investor Relations (Q1 2025 Earnings Release) - https://abc.xyz/investor/

Oberlo: Google Ad Revenue Statistics (2013–2027) - https://www.oberlo.com/statistics/google-ad-revenue

Macrotrends: Alphabet Revenue History (2012–2025) - https://www.macrotrends.net/stocks/charts/GOOG/alphabet/revenue

SEC: Alphabet Inc. 2024 Annual Report (Form 10-K) - https://www.sec.gov/ix?doc=/Archives/edgar/data/1652044/000165204425000010/goog-20241231.htm

Investing.com: Alphabet Inc. Earnings - https://www.investing.com/equities/google-inc-earnings

BYD overtakes Tesla in 2025 EV sales (China/Global Volume) - http://en.people.cn/n3/2026/0103/c90000-20409512.html

What Falling Sales? BEVs Jump 37% YoY in November in Europe! (Europe Rebound) - https://cleantechnica.com/2025/12/31/what-falling-sales-bevs-jump-37-yoy-in-november-in-europe/

Europe recalibrates as China races ahead and US stalls in EV transition (US Decline/Stagnation) - https://www.ey.com/en_ie/newsroom/2025/09/europe-recalibrates-as-china-races-ahead-and-us-stalls-in-ev-transition

Mercedes-Benz to Invest €40 Billion Through 2030 in Move to go All Electric (Initial Investment) - https://www.esgtoday.com/mercedes-benz-to-invest-e40-billion-through-2030-in-move-to-go-all-electric/

Mercedes-Benz Balances Investment in EVs and Combustion Engines (Strategic Pivot) - https://senecaesg.com/insights/mercedes-benz-balances-investment-in-evs-and-combustion-engines-amid-push-for-carbon-neutrality-by-2039/

Mercedes will drop "EQ" branding from EV names (Branding Change) - https://electrek.co/2023/01/12/mercedes-will-drop-eq-branding-from-ev-names-in-2024/

What German households pay for electricity - https://www.cleanenergywire.org/factsheets/what-german-households-pay-electricity

Electricity price statistics (First Half 2025) - https://ec.europa.eu/eurostat/statistics-explained/index.php?title=Electricity_price_statistics

Industrial electricity price: What Germany's decision means for EU industrial policy - https://www.unitedgovernmentaffairs.com/post/industrial-electricity-price-what-germany-s-decision-means-for-eu-industrial-policy

Germany Seals 2026 Industrial Power Price Subsidy - https://pexapark.com/blog/germany-seals-2026-industrial-power-price-subsidy-can-it-help-boost-the-ppa-market/

Grid-fee subsidy and power-tax cut in Germany 2026 - https://www.trioadvisory.com/resources/grid-fee-subsidy-and-power-tax-cut-germany-2026-what-energy-intensive-sites-will-really-save

German government to subsidize industry's energy prices (AP News) - https://apnews.com/article/germany-economy-industry-electricity-price-subsidy-9c2f4f6d8f98b2d134ad4997ff80d620

How enduring high energy prices could affect jobs (ECB) - https://www.ecb.europa.eu/press/blog/date/2025/html/ecb.blog20250505~86c88d726c.en.html

Over 4 million people in Germany struggle to pay utility bills (Destatis Data) - https://www.cleanenergywire.org/news/over-4-million-people-germany-struggle-pay-electricity-and-gas-bills-time

Merz signals Germany may scale back plans for renewable rollout to cut costs - https://www.cleanenergywire.org/news/merz-signals-germany-may-scale-back-plans-renewable-rollout-cut-costs

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