He's not saying "AI is done, there's nothing else to do, we've hit the limit", he's saying "bigger models don't necessarily yield better results like we had initially anticipated"

Sam recently went before congress and advocated for limiting model sizes as a means of regulation, because, at the time, he believed bigger would generally always mean better outputs. What we're seeing now is that if a model is too large it will have trouble producing truthful output, which is super important to us humans.

And honestly, I don't think anyone should be shocked by this. Our own human brains have different sections that control different aspects of our lives. Why would an AI brain be different?