I think there are enough genuine use cases. People are saving time using AI tools. There are a lot of people in office jobs. It is a huge market. Not to say it won't overshoot. With high interest rates valuations should be less frothy anyway.
Right now they’re shoveling “potential”. LLMs demonstrate capabilities we haven’t seen before, so there’s high uncertainty about the eventual impact. The pace of progress makes it _seem_ like an LLM “killer app” could appear any day and creating a sense of FOMO.
There's also the race to "AGI" -- companies spending tens of billions on training, hoping they'll hit a major intelligence breakthrough. If they don't hit anything significant that would have been money (mostly) down the drain, but Nvidia made out like a bandit.
The good startups are building, fine tuning, and running models locally.