Box CEO warns some tech leaders may overestimate what AI can do

In short: A growing debate in tech says some CEOs may be overconfident about AI, and Box CEO Aaron Levie argues it can lead to bad decisions like premature layoffs.

What's going on

Aaron Levie, the CEO of Box, wrote on X that “CEOs are uniquely prone to AI psychosis.” He says leaders can try an AI tool, see it work in a simple test, and then assume it can do a full job end to end.

Levie’s point is that CEOs are often far from the “last mile” work, meaning the detailed steps that make results safe and correct. For software, that can include reviewing code, finding bugs, and catching AI “hallucinations” (when an AI makes something up, like citing a tool or source that does not exist). For legal work, it can include training AI on a company’s specific contract language and then checking lots of documents for hidden terms.

This debate is happening as layoffs continue across tech. TechCrunch cites Layoffs.fyi data showing 115,430 people were laid off from 152 tech companies in the first five months of 2026, close to 2025’s total of 124,636.

Some companies point to AI as a reason. TechCrunch highlights ClickUp’s CEO saying the company cut 22% of staff after rolling out about 3,000 “AI agents” (AI helpers that can take actions, like a junior assistant following instructions), with remaining workers expected to manage and review the agents’ work.

What to watch

Research on AI and productivity is mixed, and several studies cited by TechCrunch suggest measured gains can lag behind the promises. Watch whether companies slow down AI-driven layoffs, and whether more leaders spend time testing AI in real workflows before reorganizing teams.

Source: TechCrunch AI