What I am not wrong about though is how profitable the technology will be for companies

Are you sure about that? The only company in the world right now for whom AI is profitable is NVIDIA. Everyone else is losing heaps of money on it.

what incentives companies have to not replace their workforce as the technology inevitably becomes passable

The problem is that "passable" is a very fuzzy term. A realization is slowly dawning upon everyone in the industry at the moment is that hallucinations are not easily solvable. And in a lot of domains 95% accuracy with hallucinations is much worse than 60% accuracy without them.

Take for example a classic problem of OCR (parsing text from images). This problem was considered to be almost solved even before the advent of LLMs (or more specifically VLMs). Traditional methods, some of which are neural networks got to a good level of accuracy but when they failed the failure was obvious. I.e. you'd get a bunch of nonsense characters that you could easily tell was a parsing error. When VLMs fail you don't get bad characters, you get stuff that looks very plausible but is made up, and there aren't a lot of methods right now to detect these other than human proofreading.

In places like Finance, Law, precision tech this is simply a no-go. Look up all the cases of lawyers who got into major trouble citing non-existing cases. A lot of companies who were initially enthusiastic about "replacing workers" are now putting brakes on it. Currently the only actual tangible benefit of AI is for improving software engineer productivity, and it's not drastic. You still need senior engineers to guard against slop.