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"OpenAI generated $13.07 billion in revenue in 2025" Considering just four years ago they were a research lab with hardly any revenue at all, and no corporate

by simonw 5mo ago

"OpenAI generated $13.07 billion in revenue in 2025" Considering just four years ago they were a research lab with hardly any revenue at all, and no corporate muscles for earning revenue, I think that is a very impressive number. (Sure, they're losing a whole lot of money too. Same goes for almost every other hyper-growth company in the history of tech.)

Retric 5mo ago
That argument supports any levels of losses, however I also think it’s rather misleading. Growth means some inefficiencies, but their expenses are largely around commodities like electricity and data centers not a sudden army of salespeople. They also got 150M 11 years ago and 1 billion 7 year ago, they where quite large in 2022. Basically you don’t get better at writing checks to your local utility which limits how much they can control costs.
- simonw 5mo ago
  > They also got 150M 11 years ago and 1 billion 7 year ago, they where quite large in 2022. I had to look that up, you're talking about investment there, not earned revenue. The 150M was their initial funding (actually 130M I think https://www.clay.com/dossier/openai-funding https://www.clay.com/dossier/openai-funding) The 1B was from Microsoft in 2019: https://openai.com/index/microsoft-invests-in-and-partners-with-openai/ https://openai.com/index/microsoft-invests-in-and-partners-w... In 2022 they only had 335 employees (according to various internet searches but I can't find an original source for that number.) I can't find credible numbers for revenue from the GPT-3 API, which did have some usage - GitHub Copilot started charging a subscription fee on June 21, 2022 - https://github.blog/changelog/2022-06-21-github-copilot-is-now-available-to-individual-developers/ https://github.blog/changelog/2022-06-21-github-copilot-is-n... - and that was running on the OpenAI Codex model so presumably OpenAI had some revenue from that.
  - Retric 5mo ago
    We don’t disagree with the underlying facts. That said, in many ways 335 employees is the midpoint between 3 employees and 30,000 employees. The CEO can’t keep track of everyone’s names and what they’re doing, you need layers of management, HR, etc. It’s not really a simple exponential function but 335 to 336 is way more automated than going from 3 to 4.
truncate 5mo ago
> Sure, they're losing a whole lot of money too. Same goes for almost every other hyper-growth company in the history of tech That doesn't mean anything. There are examples to make both ways. E.g. WeWork
- fragmede 5mo ago
  and WeWork is awesome example because it fell apart before IPO. It didn't even make it that far. On the other hand, for all of the shit talking that goes on online, SpaceX is up 49% from IPO price. All of the shit that people said about SpaceX is still true. It's still up 49%. I'm sure it'll take a dump the next time anything bad happens, like a rocket explodes, but now that it's public, I'ma be watching all their rocket launches so I can buy if that happens and sell right after. I'm also going to be watching because going to space is fucking awesome but I can't buy a trip on that rocket yet and and no one's gonna pay me to watch it.
echelon 5mo ago
Yeah, but they have no moat. They gave up on video because three separate Chinese companies were kicking their ass (and for cheaper). Google has a better image model in the majority of cases. Much faster, too. Claude Opus and Fable are like a billion times better. It's not even funny. Codex can't do Rust at all. What does that leave them? Ads in ChatGPT? I've started to just rely on Google search blended with Gemini answers now because it's faster and doesn't spit out a 20-page essay of useless effusive prose. Open source models will eat them from the bottom. Will those enterprise contracts be renewed in a market full of alternatives? There's nothing sticky about this company. They're making a necklace with Jony Ive though, I guess?
- chrisco255 5mo ago
  They still have the most recognized AI brand name and they are still the most popular LLM. For most users, a 10% diff between Claude and GPT isnt going to move the needle plus it seems to be a horse race anyways. I think their user base is stickier than you would think. Still, it isn't as sticky as social media and it is cheaper to switch AIs than email accounts.
  - echelon 5mo ago
    Look at the ChatGPT usage share. It's dropped dramatically in the last year. https://techcrunch.com/2026/06/16/chatgpts-market-share-slips-below-50-for-first-time/ https://techcrunch.com/2026/06/16/chatgpts-market-share-slip... This is not the winner take all market that OpenAI needs it to be.
    - chrisco255 4mo ago
      Its still dominant and a lot higher % wise if you count paying users. Gemini was integrated into Google search so its not necessarily people using Gemini as their daily assistant.
- zozbot234 5mo ago
  Opus 4.8 is quite weak. And GPT-Pro is very much available unlike Fable, it's just not hooked up to the Codex harness yet.
raincole 5mo ago
> Same goes for almost every other hyper-growth company in the history of tech Except it's not true. No one lost $38.5B in a year just to 'hyper-grow' or whatever it means. Uber accumulated ~$30B loss over a decade. Edit: I read it wrong. The loss was mostly caused by one-time event[0]: > Before OpenAI’s switch late last year to become a public benefit corporation, investors in the company received convertible interest rights rather than conventional equity. Under US accounting rules, those interests were treated as liabilities and periodically revalued as the company’s valuation increased. It looks like that OpenAI is actually quite in line with other companies that lost money to grow. [0]: https://www.ft.com/content/e15b0d7e-ff6b-4f16-ba7a-4068feddb828 https://www.ft.com/content/e15b0d7e-ff6b-4f16-ba7a-4068feddb...
- Retric 5mo ago
  Depreciating assets is one of several possibilities.
- deleted 5mo ago
  [deleted]
bxk76 5mo ago
Or a utility :) Look at how a utlity works, in setting price specifically, for things that are considered a public good. The story is not about how much profit or revenue they make. Its about how do you keep it afloat and expanding in the coming year. Thats it.
- bandrami 5mo ago
  Compute is both rivalrous and excludable so it can't be a public good in an economic sense
freakynit 5mo ago
If your losses scale with your growth, while at the same time your competitors are eating into your future user-base, how are you ever gonna become profitable? Only two ways comes to my mind: regulatory capture, and moving upwards into full software-development house.
dofm 5mo ago
$867 million of that was Softbank. News the market has not taken well.
bambax 5mo ago
AI doesn't work like the rest of the tech industry. The cost of selling another license for a software program is approximately zero. In the case of AI the marginal cost of the next token is not zero, and is in fact probably not going down much with volume, if at all. So I'm not sure one can argue that scale will solve everything. It's very much like the old adage "we lose money on every sale, but make it up in volume". No you don't.
- hackcasual 5mo ago
  It's wild to think how efficient Internet services were prior to AI. The most expensive thing would probably have been something like encoding video. Now you've a substantial portion of a rack dedicated to a user in the case of something like fable
  - Ekaros 5mo ago
    Best analogue we have is probably video streaming. Or maybe more so live streaming. Unless subscription based and limited time events it seems those don't do well. Twitch has lost money for how long? And most smaller players seem propped up in other ways. So if there is real cost involved things start to look lot worse and might not be overcome. OpenAI is unlikely to be exception for me.
    - nl 5mo ago
      But video streaming can be very profitable! Youtube and Netflix are great examples.
- pqtyw 5mo ago
  But there is no indication they are losing money on tokens when R&D and other expenses are factored out? The margins on API are likely very high so the higher the volume the more likely they will be able to cover the other mostly fixed costs.
  - bambax 5mo ago
jacobgold 5mo ago
Annual revenue of $13 billion per year puts them on par with Apple's AirPods revenue, which places them in U.S. Fortune 500.
- ltononro 5mo ago
  lol so weird to put that into perspective macbook ~8b airpods ~18b iphones ~60b I know they are massive, but AI seems something much more important than airpods
hcheffer 4mo ago
And a JPEG was just a JPEG in 2020, but in 2021 they became a 17 billion dollar speculative market. How "very impressive" is your NFT collection these days?
- simonw 4mo ago
  NFTs were very obviously stupid. LLMs aren't.
  - hcheffer 4mo ago
    Your argument went from "big number good" to redefining "stupid", and you think that somehow supports your original statement? What word would you use to describe someone that: - told you to put glue on pizza? - thinks there's 1 'r' in strawberry? - is incapable of stopping terminal flickering? - deletes your production database? - bankrupts you trying to scan the entire IPv6 address space of a play network interface? - can only attempt to draw a bird on a bike in the most bland and unimaginative style possible yet still completely failing? All while being given the entire US economy and polluting the only planet we have to do so?
    - simonw 4mo ago
      If you still think models can't count the Rs in strawberry you're about a year out of date.
      - hcheffer 4mo ago
        Nice. I mean, sure you said "LLMs", rather than "LLMs in the last 12 months", and sure, you completely abandoned your original argument, and sure, you ignored the other things listed, and of course everyone knows that list is a comprehensive list of the only failings of genai rather than a honeypot to positively identify you as a shameless shill, but ultimately, the fact that HN chose someone this terrible at making a defensible logical argument to be their favorite genai financial interest mouthpiece is a strong indicator defending the criticisms in the original submission.

by simonw 5mo ago

Retric 5mo ago

That argument supports any levels of losses, however I also think it’s rather misleading. Growth means some inefficiencies, but their expenses are largely around commodities like electricity and data centers not a sudden army of salespeople. They also got 150M 11 years ago and 1 billion 7 year ago, they where quite large in 2022. Basically you don’t get better at writing checks to your local utility which limits how much they can control costs.

simonw 5mo ago
> They also got 150M 11 years ago and 1 billion 7 year ago, they where quite large in 2022. I had to look that up, you're talking about investment there, not earned revenue. The 150M was their initial funding (actually 130M I think https://www.clay.com/dossier/openai-funding https://www.clay.com/dossier/openai-funding) The 1B was from Microsoft in 2019: https://openai.com/index/microsoft-invests-in-and-partners-with-openai/ https://openai.com/index/microsoft-invests-in-and-partners-w... In 2022 they only had 335 employees (according to various internet searches but I can't find an original source for that number.) I can't find credible numbers for revenue from the GPT-3 API, which did have some usage - GitHub Copilot started charging a subscription fee on June 21, 2022 - https://github.blog/changelog/2022-06-21-github-copilot-is-now-available-to-individual-developers/ https://github.blog/changelog/2022-06-21-github-copilot-is-n... - and that was running on the OpenAI Codex model so presumably OpenAI had some revenue from that.
- Retric 5mo ago
  We don’t disagree with the underlying facts. That said, in many ways 335 employees is the midpoint between 3 employees and 30,000 employees. The CEO can’t keep track of everyone’s names and what they’re doing, you need layers of management, HR, etc. It’s not really a simple exponential function but 335 to 336 is way more automated than going from 3 to 4.

truncate 5mo ago

> Sure, they're losing a whole lot of money too. Same goes for almost every other hyper-growth company in the history of tech That doesn't mean anything. There are examples to make both ways. E.g. WeWork

fragmede 5mo ago
and WeWork is awesome example because it fell apart before IPO. It didn't even make it that far. On the other hand, for all of the shit talking that goes on online, SpaceX is up 49% from IPO price. All of the shit that people said about SpaceX is still true. It's still up 49%. I'm sure it'll take a dump the next time anything bad happens, like a rocket explodes, but now that it's public, I'ma be watching all their rocket launches so I can buy if that happens and sell right after. I'm also going to be watching because going to space is fucking awesome but I can't buy a trip on that rocket yet and and no one's gonna pay me to watch it.

echelon 5mo ago

Yeah, but they have no moat. They gave up on video because three separate Chinese companies were kicking their ass (and for cheaper). Google has a better image model in the majority of cases. Much faster, too. Claude Opus and Fable are like a billion times better. It's not even funny. Codex can't do Rust at all. What does that leave them? Ads in ChatGPT? I've started to just rely on Google search blended with Gemini answers now because it's faster and doesn't spit out a 20-page essay of useless effusive prose. Open source models will eat them from the bottom. Will those enterprise contracts be renewed in a market full of alternatives? There's nothing sticky about this company. They're making a necklace with Jony Ive though, I guess?

chrisco255 5mo ago
They still have the most recognized AI brand name and they are still the most popular LLM. For most users, a 10% diff between Claude and GPT isnt going to move the needle plus it seems to be a horse race anyways. I think their user base is stickier than you would think. Still, it isn't as sticky as social media and it is cheaper to switch AIs than email accounts.
- echelon 5mo ago
  Look at the ChatGPT usage share. It's dropped dramatically in the last year. https://techcrunch.com/2026/06/16/chatgpts-market-share-slips-below-50-for-first-time/ https://techcrunch.com/2026/06/16/chatgpts-market-share-slip... This is not the winner take all market that OpenAI needs it to be.
  - chrisco255 4mo ago
    Its still dominant and a lot higher % wise if you count paying users. Gemini was integrated into Google search so its not necessarily people using Gemini as their daily assistant.
zozbot234 5mo ago
Opus 4.8 is quite weak. And GPT-Pro is very much available unlike Fable, it's just not hooked up to the Codex harness yet.

raincole 5mo ago

> Same goes for almost every other hyper-growth company in the history of tech Except it's not true. No one lost $38.5B in a year just to 'hyper-grow' or whatever it means. Uber accumulated ~$30B loss over a decade. Edit: I read it wrong. The loss was mostly caused by one-time event[0]: > Before OpenAI’s switch late last year to become a public benefit corporation, investors in the company received convertible interest rights rather than conventional equity. Under US accounting rules, those interests were treated as liabilities and periodically revalued as the company’s valuation increased. It looks like that OpenAI is actually quite in line with other companies that lost money to grow. [0]: https://www.ft.com/content/e15b0d7e-ff6b-4f16-ba7a-4068feddb828 https://www.ft.com/content/e15b0d7e-ff6b-4f16-ba7a-4068feddb...

Retric 5mo ago
Depreciating assets is one of several possibilities.
deleted 5mo ago
[deleted]

bxk76 5mo ago

Or a utility :) Look at how a utlity works, in setting price specifically, for things that are considered a public good. The story is not about how much profit or revenue they make. Its about how do you keep it afloat and expanding in the coming year. Thats it.

bandrami 5mo ago
Compute is both rivalrous and excludable so it can't be a public good in an economic sense

freakynit 5mo ago

If your losses scale with your growth, while at the same time your competitors are eating into your future user-base, how are you ever gonna become profitable? Only two ways comes to my mind: regulatory capture, and moving upwards into full software-development house.

dofm 5mo ago

$867 million of that was Softbank. News the market has not taken well.

bambax 5mo ago

AI doesn't work like the rest of the tech industry. The cost of selling another license for a software program is approximately zero. In the case of AI the marginal cost of the next token is not zero, and is in fact probably not going down much with volume, if at all. So I'm not sure one can argue that scale will solve everything. It's very much like the old adage "we lose money on every sale, but make it up in volume". No you don't.

hackcasual 5mo ago
It's wild to think how efficient Internet services were prior to AI. The most expensive thing would probably have been something like encoding video. Now you've a substantial portion of a rack dedicated to a user in the case of something like fable
- Ekaros 5mo ago
  Best analogue we have is probably video streaming. Or maybe more so live streaming. Unless subscription based and limited time events it seems those don't do well. Twitch has lost money for how long? And most smaller players seem propped up in other ways. So if there is real cost involved things start to look lot worse and might not be overcome. OpenAI is unlikely to be exception for me.
  - nl 5mo ago
    But video streaming can be very profitable! Youtube and Netflix are great examples.
pqtyw 5mo ago
But there is no indication they are losing money on tokens when R&D and other expenses are factored out? The margins on API are likely very high so the higher the volume the more likely they will be able to cover the other mostly fixed costs.
- bambax 5mo ago

jacobgold 5mo ago

Annual revenue of $13 billion per year puts them on par with Apple's AirPods revenue, which places them in U.S. Fortune 500.

ltononro 5mo ago
lol so weird to put that into perspective macbook ~8b airpods ~18b iphones ~60b I know they are massive, but AI seems something much more important than airpods

hcheffer 4mo ago

And a JPEG was just a JPEG in 2020, but in 2021 they became a 17 billion dollar speculative market. How "very impressive" is your NFT collection these days?

simonw 4mo ago
NFTs were very obviously stupid. LLMs aren't.
- hcheffer 4mo ago
  Your argument went from "big number good" to redefining "stupid", and you think that somehow supports your original statement? What word would you use to describe someone that: - told you to put glue on pizza? - thinks there's 1 'r' in strawberry? - is incapable of stopping terminal flickering? - deletes your production database? - bankrupts you trying to scan the entire IPv6 address space of a play network interface? - can only attempt to draw a bird on a bike in the most bland and unimaginative style possible yet still completely failing? All while being given the entire US economy and polluting the only planet we have to do so?
  - simonw 4mo ago
    If you still think models can't count the Rs in strawberry you're about a year out of date.
    - hcheffer 4mo ago
      Nice. I mean, sure you said "LLMs", rather than "LLMs in the last 12 months", and sure, you completely abandoned your original argument, and sure, you ignored the other things listed, and of course everyone knows that list is a comprehensive list of the only failings of genai rather than a honeypot to positively identify you as a shameless shill, but ultimately, the fact that HN chose someone this terrible at making a defensible logical argument to be their favorite genai financial interest mouthpiece is a strong indicator defending the criticisms in the original submission.