Pagliuca: AI will retool the global economy and boost productivity

Watch on YouTube ↗  |  February 04, 2026 at 16:03  |  12:45  |  CNBC
Speakers
Steve Pagliuca — Senior Advisor, Bain Capital; Founder and CEO, Pags Group

Summary

Bain Capital senior advisor Steve Pagliuca spoke with CNBC from the World Government Summit in Dubai about how AI is reshaping markets and the economy. He argued the AI-driven selloffs in software and publicly traded private equity look overdone, described the trillion-dollar AI infrastructure buildout as existential and non-speculative rather than a 1999-style bubble, and flagged quantum computing as a coming second wave. He also made the case for AI-driven biotech breakthroughs, drugmaker profit tailwinds from a global pricing reset, relative gains for the US and China from supply-chain decoupling, and rising sports team valuations.

  • Pagliuca calls the AI-driven software selloff an overreaction, saying SaaS remains embedded with high retention.
  • He sees the drop in publicly traded private equity names like Blackstone and Carlyle as overdone and value-rich.
  • AI infrastructure and data-center spending is framed as existential, budgeted and trillions-scale, with chip orders doubling or tripling.
  • Quantum computing in 3-5 years is expected to drive a similar investment cycle and enhance AI.
  • AI protein folding and simulations should accelerate drug discovery and biotech breakthroughs over 3-10 years.
  • A reversal of global drug-pricing policy should lift drugmakers' international profits.
  • Strategic supply-chain decoupling is seen benefiting the US and China while hurting the EU.
  • Streaming globalization and the battle for sports rights keep driving sports team valuations higher.
Ideas
Steve Pagliuca Senior Advisor, Bain Capital; Founder and CEO, Pags Group 1:02
AI software selloff looks overdone.
There is some truth to the AI-disrupting-software narrative, but the market has overreacted: SaaS has been a great business for 20 years and much of it is deeply embedded with high retention, while AI mainly erodes incremental seat expansion and pushes some spend in-house; with valuations very high anyway, the selloff went too far and some of it should come back.
IGV MED
Steve Pagliuca Senior Advisor, Bain Capital; Founder and CEO, Pags Group 2:02
Public PE selloff is overdone.
The selloff in publicly traded private equity firms is likely an overreaction: most own diversified portfolios with good assets and low default rates and are doing well, and names like Blackstone and Carlyle are not all software-as-a-service exposure and look like value, so investors should examine the underlying asset base rather than assume the drop was deserved.
BX CG MED
Steve Pagliuca Senior Advisor, Bain Capital; Founder and CEO, Pags Group 3:07
AI infrastructure spending is massive, non-speculative.
The world is building the digital railway of the future: trillions of dollars of AI infrastructure and data-center spending over the next 3-4 years that is existential and budgeted, not speculative, for cash-rich giants like Microsoft and Google, with large indirect spending on energy sources, plant and facility construction, and chip companies whose orders are doubling and tripling, which should buoy the economy.
AIQ DTCR SMH XLE HIGH
Steve Pagliuca Senior Advisor, Bain Capital; Founder and CEO, Pags Group 4:07
Quantum computing will enhance the AI cycle.
In a 3-to-5-year timeframe quantum computing should drive a similar massive investment cycle and may even enhance the AI cycle, and combined with AI it will help harness the genome and speed drug development.
QUBT MED
Steve Pagliuca Senior Advisor, Bain Capital; Founder and CEO, Pags Group 5:51
AI is accelerating biotech drug discovery.
Biotech is already benefiting greatly from AI: digital protein folding and simulations that used to take months or years now take days, enabling breakthroughs in cancer treatments and health and wellness, and combining AI with quantum computing will allow the genome to be harnessed to bring drugs out faster and cheaper with shorter trials; the full force takes 3-10 years, and PAGS Group has invested in many biotech companies now diving into these tools.
XBI HIGH
Steve Pagliuca Senior Advisor, Bain Capital; Founder and CEO, Pags Group 8:14
Drugmakers gain from international pricing shift.
US drug prices are high partly because drugmakers charge international countries much less while the US subsidizes global pricing; the current administration is reversing that, which should let drug companies make more profits internationally and ease US price pressure, on top of AI and quantum computing shortening the costly trial cycle.
XLV MED
Steve Pagliuca Senior Advisor, Bain Capital; Founder and CEO, Pags Group 9:22
US, China win supply-chain decoupling; EU loses.
Countries are decoupling supply chains for strategic items like chips and lithium after the COVID wake-up call, and the relative beneficiaries are the US and China because they already have giant scale markets and are reallocating supply chains; European countries and the EU are hurt unless they unify, and global trade should pick up again once the process finishes.
United States (economy) FXI MED
Steve Pagliuca Senior Advisor, Bain Capital; Founder and CEO, Pags Group 9:22
US, China win supply-chain decoupling; EU loses.
Countries are decoupling supply chains for strategic items like chips and lithium after the COVID wake-up call, and the relative beneficiaries are the US and China because they already have giant scale markets and are reallocating supply chains; European countries and the EU are hurt unless they unify, and global trade should pick up again once the process finishes.
VGK MED
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This CNBC video, published February 04, 2026, features Steve Pagliuca discussing IGV, BX, CG, AIQ, DTCR, SMH, XLE, QUBT, XBI, XLV, United States (economy), FXI, VGK. 8 trade ideas extracted by AI with direction and confidence scoring.

Speakers: Steve Pagliuca  · Tickers: IGV, BX, CG, AIQ, DTCR, SMH, XLE, QUBT, XBI, XLV, United States (economy), FXI, VGK