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Docs: OpenAI and Anthropic have projected profitability to investors with and without training costs, and report inference costs exceeding half of their revenue

Silicon Valley's hottest startups have the same challenge: funding giant computing costs  —  OpenAI and Anthropic

Wall Street Journal

Context & Ripple Effects

Earlier investor projections already put OpenAI’s path to profit later than Anthropic’s, with their projected break-even timelines diverging even before this disclosure clarifies how much the answer depends on treating training costs separately.

The new documents shift attention from headline revenue growth to serving economics: inference alone consumes more than half of revenue at both companies, making recurring usage—not just frontier-model development—the central financial constraint.

First-order effects

  • OpenAI and Anthropic must show investors two distinct profitability views: one that includes the cost of training new models and one that does not, exposing how sensitive reported economics are to that accounting boundary.
  • With inference taking more than half of revenue, each company faces immediate pressure to improve serving efficiency, raise monetization per use, or constrain costly usage before gross margins can expand.

Second-order effects

  • Enterprise pricing, product limits, and model-routing choices become more consequential, since heavier adoption can deepen revenue while also adding substantial variable compute expense.
  • The cost burden strengthens the appeal of cheaper alternatives and routing tools; related coverage shows customers turning to lower-cost models as AI bills rise, adding pressure on OpenAI and Anthropic to defend pricing and performance.

Third-order effects

  • If inference remains this expensive at scale, the competitive advantage in generative AI will increasingly rest on durable serving infrastructure and unit economics, rather than model capability alone.
  • Separating profitability from training costs may become a key investor test for AI companies: whether recurring model usage can support itself before continual frontier-model investment is counted.

The trend: Generative-AI competition is moving from a race to build frontier models toward a race to make high-volume inference economically sustainable.

Discussion

  • @naveengrao Naveen Rao on x
    Something else about this news struck me...we typically think of companies as becoming self-sustaining entities bc they build a product that satisfies some demand. What if that demand is ONLY to be part of building AI tech? As in, can continual investment be a self-sustaining
  • @shiraovide Shira Ovide on bluesky
    Every generation of start-ups has its own fuzzy math.  —  Groupon had ACSOI (earnings excluding very high marketing costs)  —  WeWork had a similar “community adjusted Ebitda”  —  I guess OpenAI and Anthropic have earnings excluding training costs (which are very very high) www.w…
  • @morqon Morgan on x
    look at openai's research compute spend as a share of revenue and the huge increase in spend is matched by a huge increase in revenue [image]