5+ year dev cycles are insane (with very few guaranteed-to-succeed exceptions), and not just because of the expense of developing for so long but because of how much the market can shift in the interim. Most studios need to stay nimble and be able to respond to changing trends; being locked into a project for so long makes that impossible. This is how studios end up doing stupid shit like developing a Wonder Woman game for multiple years beyond the point at which it was guaranteed to flop, or having to delay a game for months to minimise the woke content they already spent months putting into the game.
If AI makes it possible to get back to a far more reasonable ~2 year cycle, without sacrificing quality, it will be hugely beneficial to studios. Beneficial in terms of it being more likely that the target will still be in the same place by the time they get to release, and in terms of making it more viable to take risks to begin with if it's taking much less time to reach a point where they can know if that 'riskier idea' is working out or not.
There are also some things which AI can potentially make possible in gaming which we currently just don't get because they would be prohibitively expensive with a human workforce. These possibilities don't really get enough consideration, but that is a slightly different topic.