Sri Lanka, March 11 -- Elevated AI-driven credit risks are concentrated in three technology, media and telecommunications (TMT) sectors, with software, media and services facing rising disruption risk while overinvestment risk remains largely confined to hyperscalers and select cloud providers, according to a new Fitch Ratings report.
Asset-light businesses where value is driven by intangibles such as software, IP, brands and human capital face higher disruption risk as "good enough" AI-enabled substitutes emerge. These sectors could see intensified competition and pressure on pricing and margins as AI lowers barriers to entry and reduces development costs. Within these sectors, companies with mission-critical functions, high switching cos...