One of the leading artificial intelligence (AI) stocks on the market was left far behind by investors on Tuesday. C3.ai (AI 0.12%) saw its share price crumble by almost 8% on the back of comments made by a leading executive in the AI field, as well as regulatory developments overseas. That decline was far sharper than the 1.4% drop of the bellwether S&P 500 index that day.

Altman speaks, and the EU legislates

At the World Governments Summit in Dubai, OpenAI CEO Sam Altman sounded a note of caution about the rapid advance of AI technology. In a live video interview, he said of it: "There's some things in there that are easy to imagine where things really go wrong." In many ways, Altman is the face of AI, as his company developed the massively popular ChatGPT software.

Altman wasn't being apocalyptic, but his concerns were striking, given that he and OpenAI have risen to great prominence on AI applications. He clarified his position by saying that "I'm much more interested in the very subtle societal misalignments where we just have these systems out in society and, through no particular ill intention, things just go horribly wrong."

In another development, two committees at the European Union's (EU) European Parliament ratified that body's AI Act. This is a set of rules that will form the framework of AI regulation in the 27-nation EU.

Not all is sunshine and roses with AI

While Altman was more cautious than pessimistic in his statements and the AI Act has been percolating for quite some time, neither development cheered investors. AI is already a powerful technology, and care must be taken to utilize it properly. Yet investors often don't want to hear the potential downsides, nor are they eager to see the dawn of what might be considered excessive regulation.