OpenAI's annualized revenue hits $10 billion, up from $5.5 billion in December 2024
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Do you think OpenAI could be falsifying data, laundering money, or is it just that investors are hyped about AI?
I assume that any venture backed company riding the crest of a hype wave is doing all three of those things, (because many past venture backed companies riding the crest of a hype wave have turned out to be doing all three of those things.)
There are more con-artists at an average technology investment conference, than there are free vendor labeled give-away USB drives.
But OpenAI is still a real tool, and actually does some interesting stuff. (Contrasted with many past venture investment hype waves that were 100% pure bullshit, such as various "risk free" finance products, and some "no one asked for this" BlockChain apps.)
That said - as others in this thread have pointed out - while the revenue quote is a surprising number, it's not completely implausible, by any means. I personally know plenty of people who find an AI product subscription worth a few dollars each month.
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Good point.
That would put OpenAI around #5 on this list (by estimated subscriber count): https://largest.org/technology/largest-saas-businesses-by-number-of-subscribers/
Less than Microsoft, Google, SalesForce and Zoom - but higher than Slack, DropBox, and Adobe Creative Cloud.
It's surprising and rare for a relatively new company to jump that high in user base this quick.
It's surprising, but it's plausible. OpenAI and derived products do anecdotally seem about that popular, this year.
OpenAI reminds me in some ways of Netscape, except that it hasn't gone public yet, compared to the latter, which did so only 16 months after its founding.
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They love pointing out their revenue instead of their profit. It they were truly making money, you’d think they’d refer to their profit instead.
Revenue is a standard unit of measurement for any venture backed business because it gauges interest and growth better than profit does
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I assume that any venture backed company riding the crest of a hype wave is doing all three of those things, (because many past venture backed companies riding the crest of a hype wave have turned out to be doing all three of those things.)
There are more con-artists at an average technology investment conference, than there are free vendor labeled give-away USB drives.
But OpenAI is still a real tool, and actually does some interesting stuff. (Contrasted with many past venture investment hype waves that were 100% pure bullshit, such as various "risk free" finance products, and some "no one asked for this" BlockChain apps.)
That said - as others in this thread have pointed out - while the revenue quote is a surprising number, it's not completely implausible, by any means. I personally know plenty of people who find an AI product subscription worth a few dollars each month.
Well, it's surprising that OpenAI has that kind of revenue, considering that software companies in that nonprofit sector can't achieve that kind of revenue. If we talk about other sectors like journalism, like the Associated Press, they can achieve that kind of revenue.
I agree that in technology, there are many scammers, but most fail and don't make an impact. But then there are others who manage to continue and make an impact, like Builder.ai or Theranos. Then there are exceptional cases that do make a big impact, like Enron or WorldCom.
Well, we'll have to see how their income evolves next year, as well as what their plan will be to transition from a non-profit to a PBC.
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Thats less than 50 million GPT plus subscriptions, even fewer if you factor in the more expensive subscriptions. Thats alot of subscriptions, but not an implausible number.
They also have an API, I think a chunk of that revenue comes from there. Think 3rd party apps and services having chat bots, writing assistants, etc that use openai's API.
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It's...weird? Not normal, anyway.
Usually $10 billion worth of revenue has obvious products, services and outcomes it to point to.
$10 billion is a difficult to understand amount of money, and unusual for a relatively new software as a service company.
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The first iPhone release completely transformed society within a few years...and earned about 1/10th that much revenue (6 million units at $700.00, if I've got my sums right). (Although I imagine Apple makes much more from the app store, than the devices.)
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$10 billion is about 1/4 of the annual revenue of SalesForce, one of the most successful software as a service companies. SalesForce generates sales, which companies tend to be quite happy to pay for, of course.
So OpenAI doubling in revenue and hitting those kinds of numbers this soon is, odd. Unexpected.
To speculate a bit, it may be the kind of fortune enjoyed by folks who sold mining equipment to gold diggers during the gold rush.
There is presumably lots of speculative investment money flowing to companies that are promising big rewards from novel applications of the OpenAI technology. Of course they have to purchase the technology today, to deliver the huge novel profits next year...
I base this speculation the observation that there's usually sizeable amounts of money chasing hot new technologies.
6 million units at $700 a pop is $4.2 billion in revenue. Much closer to 1/2 of $10 billion than 1/10.
Apple has never made more money from the App Store than from iPhone hardware sales. When the iPhone launched the App Store didn’t exist yet. Over time, Apple’s revenue from services (including the App Store) has grown dramatically to around $26 billion per quarter today, though that is still less than what they earn in iPhone sales (a bit over $50 billion per quarter in 2024).
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Good point.
That would put OpenAI around #5 on this list (by estimated subscriber count): https://largest.org/technology/largest-saas-businesses-by-number-of-subscribers/
Less than Microsoft, Google, SalesForce and Zoom - but higher than Slack, DropBox, and Adobe Creative Cloud.
It's surprising and rare for a relatively new company to jump that high in user base this quick.
It's surprising, but it's plausible. OpenAI and derived products do anecdotally seem about that popular, this year.
That’s a strange list. OpenAI doesn’t only offer SaaS for end users, it also offers API access which puts it into the infrastructure game with the likes of Amazon AWS, Google Cloud, and Microsoft Azure (which actually offers OpenAI services and pushes them out to Windows users en masse).
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And now the expenses…?
🦗🦗🦗
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And now the expenses…?
🦗🦗🦗
$5B loss last year.
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Revenue is a standard unit of measurement for any venture backed business because it gauges interest and growth better than profit does
Does that run the risk of leading to a future collapse of certain businesses, especially if their expenses remain consistently astronomical like OpenAI? Please note I don’t actually know—not trying to be cheeky with this question. Genuinely curious.
