UBS CEO says the AI pullback is healthy — but there’s a bigger risk investors should watch

UBS reported a profit rise in its second-quarter earnings Wednesday, as CEO Sergio Ermotti warned that geopolitical volatility could create fresh headwinds up ahead.The Swiss banking and wealth management giant's net profit attributable to shareholders came in at $2.8 billion for the three-month period, in line with forecasts by analysts in an LSEG-compiled consensus poll. Pre-tax profits reached $3.6 billion in the three-month period, up 64% year-on-year. Speaking with CNBC's "Squawk Box Europe," Ermotti highlighted strong momentum across the business during the second quarter, with a "very good" pipeline in investment banking, M&A and capital markets, and positive results across leveraged capital markets, debt capital markets, and equities.He also flagged a "vibrant" IPO market, with UBS involved in a number of deals, including SpaceX's landmark debut. The bank also unveiled a new $3 billion share buyback plan, starting with the repurchase of $1 billion of shares over the next three months.UBS shares were 2.5% higher in morning trade.Ermotti acknowledged geopolitical fissures remain a pressure point for markets, but shrugged off potential growing market fatigue around the AI ...