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Serving the API is profitable. They are unprofitable because of R&D (and maybe subscription costs?). If they can continue to find access to R&D capital, there i

Serving the API is profitable. They are unprofitable because of R&D (and maybe subscription costs?). If they can continue to find access to R&D capital, there is space to reduce API costs.

dominotw 3mo ago
how do you have access to their financials? are you an insider? Edit: to the commenter below . It was widely reported that these companies were unprofitable 1 from last year. I am asking question to this specefic comment because they made a very specific claim about part of plan thats profitable . something only an insider would know. 1. https://www.wsj.com/tech/ai/openai-anthropic-profitability-e9f5bcd6 https://www.wsj.com/tech/ai/openai-anthropic-profitability-e...
- mh- 3mo ago
  I'm curious why you didn't pose this question to the grandparent commenter, who first asserted the opposite?
  - zyuiop 3mo ago
    The amount of capital they need to raise, despite the claimed revenue, indicates that they spend more than they gain, which is by definition unprofitable.
dns_snek 3mo ago
Nuclear energy is really cheap too... as long as you ignore CapEx, would you like to invest?
- HDThoreaun 3mo ago
  Marginal cost of nuclear is huge. Marginal cost of inference is much smaller. Capex in nuclear isn’t a fixed cost, it is the marginal cost.
  - dns_snek 3mo ago
    The marginal cost of nuclear energy is 14-20% of the total cost according to pages 39,40 of [1]. The point I'm making is that claiming that AI labs would be profitable if only they could stop spending money on the only thing that makes them valuable is absurd. Frontier models are like a nuclear power plant that needs to be rebuilt from scratch every 24 months. Let's say that they paused R&D a year ago. It's June 2026, OpenAI's latest offering is GPT 4.1, Codex is still just a private beta that hasn't been updated in months. How much revenue do you think they would be making right now? My guess is approximately zero. [1] https://www.lazard.com/media/5tlbhyla/lazards-lcoeplus-june-2025-_vf.pdf https://www.lazard.com/media/5tlbhyla/lazards-lcoeplus-june-...
    - HDThoreaun 3mo ago
      The labs don’t have to stop r and d to become profitable. They just need more customers. This strategy doesn’t work in nuclear. Building a nuclear plant doesn’t mean you can scale it up to serve the whole world. Building an ai model does.

Serving the API is profitable. They are unprofitable because of R&D (and maybe subscription costs?). If they can continue to find access to R&D capital, there is space to reduce API costs.

dominotw 3mo ago

how do you have access to their financials? are you an insider? Edit: to the commenter below . It was widely reported that these companies were unprofitable 1 from last year. I am asking question to this specefic comment because they made a very specific claim about part of plan thats profitable . something only an insider would know. 1. https://www.wsj.com/tech/ai/openai-anthropic-profitability-e9f5bcd6 https://www.wsj.com/tech/ai/openai-anthropic-profitability-e...

mh- 3mo ago
I'm curious why you didn't pose this question to the grandparent commenter, who first asserted the opposite?
- zyuiop 3mo ago
  The amount of capital they need to raise, despite the claimed revenue, indicates that they spend more than they gain, which is by definition unprofitable.

dns_snek 3mo ago

Nuclear energy is really cheap too... as long as you ignore CapEx, would you like to invest?

HDThoreaun 3mo ago
Marginal cost of nuclear is huge. Marginal cost of inference is much smaller. Capex in nuclear isn’t a fixed cost, it is the marginal cost.
- dns_snek 3mo ago
  The marginal cost of nuclear energy is 14-20% of the total cost according to pages 39,40 of [1]. The point I'm making is that claiming that AI labs would be profitable if only they could stop spending money on the only thing that makes them valuable is absurd. Frontier models are like a nuclear power plant that needs to be rebuilt from scratch every 24 months. Let's say that they paused R&D a year ago. It's June 2026, OpenAI's latest offering is GPT 4.1, Codex is still just a private beta that hasn't been updated in months. How much revenue do you think they would be making right now? My guess is approximately zero. [1] https://www.lazard.com/media/5tlbhyla/lazards-lcoeplus-june-2025-_vf.pdf https://www.lazard.com/media/5tlbhyla/lazards-lcoeplus-june-...
  - HDThoreaun 3mo ago
    The labs don’t have to stop r and d to become profitable. They just need more customers. This strategy doesn’t work in nuclear. Building a nuclear plant doesn’t mean you can scale it up to serve the whole world. Building an ai model does.