CFO Reports AI Investment 'Definitely Doing Something' in Earnings Call
Company spent $340 million on AI infrastructure, cannot articulate single measurable outcome beyond 'vibes are good.'
During Tuesday's earnings call, Apex Solutions CFO Derek Henneman assured investors that the company's $340 million AI investment is "absolutely doing something," though he could not specify what that something is or how it might be measured.
"Look, the models are running. The dashboards have numbers on them. People are nodding in meetings," Henneman told analysts. "We're seeing really promising preliminary indicators in the pre-quantitative assessment phase."
When pressed by JP Morgan analyst Christine Voh for concrete ROI figures, Henneman pivoted to discussing "infrastructure readiness" and "positioning for the AI-native future," terms he repeated seven times in four minutes. He then cited a McKinsey report he admitted he had not read.
The company's AI spend includes $180 million for Nvidia chips, $85 million for cloud compute, $60 million for consulting fees, and $15 million for what Henneman described as "just generally AI stuff." Apex's core business is manufacturing industrial adhesives.
"Our competitors are spending on AI, so we're spending on AI," Henneman explained. "It's like insurance. You don't know what it's for until you need it, and even then you're not totally sure." He added that three employees have used the company's new AI chatbot to summarize emails they were already going to read anyway.
Apex shares rose 4% after the call. One buy-side analyst noted the company "successfully avoided saying they wasted $340 million," which he characterized as "frankly impressive guidance management."
Henneman concluded the call by noting that Apex plans to increase AI spending by 60% next year "to maintain strategic ambiguity with our peer set."
The company's AI steering committee meets quarterly and has yet to define what AI means for Apex's business, but members report the catering is excellent.