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Why Wall Street is ignoring big tech's debt [video]

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Re: Why Wall Street is ignoring big tech's debt [video]

#151

Post by tristanj »

stackskipton wrote: post #127
tristanj wrote: post #124

Earlier quoted context omitted.

Utterly false -- review the numbers yourself https://www.wsj.com/tech/ai/mind-blowing-growth-is-about-to-... https://newsletter.semianalysis.com/p/anthropic-3q26-profit-... The company was profitable in Q2 and is projected to exceed $1B in profit in Q3.

I can't read the first article 100% but it's linked here: https://www.wheresyoured.at/anthropics-profitability-swindle... which I noted in my original post seems to be full of juiced numbers. Second link talks about revenue and operating costs. Again, it's very possible that Anthropic is profitable as I hinted looking at pure revenue vs operating costs. That's like saying your delivery service is profitable because y…

1) Ed Zitron has one of the worst track records in the AI space. He's consistently wrong about everything. Every major prediction he has made over the past five years has aged terribly.

2) After calling the doom of OpenAI and Anthropic for half a decade, Zitron pivoted this year into accusing these companies of financial engineering and fraud. I have read the "article" you linked and he makes this accusation with no evidence backing it up.

3) I intentionally did not address your "delivery service" example because it is financially illiterate. Per the first section of the links provided (which you can read without paywall), Anthropic is EBITDA profitable. EBITDA profitability implies the company has positive gross margins AND is operational profitable, which means the company is profitable under your fictitious "delivery service" scenario.

4) Claiming a profitable company must immediately file an S-1 and IPO is a non-sequitur. Thousands of large, highly profitable companies choose to stay private for strategic reasons.

5) Did you casually forget the fact that Anthropic is currently in the process of going public? They already filed a draft S-1 with the SEC. They're planning an IPO this October. Having gone through an IPO myself, it takes over a year of preparation for an IPO. The slow timeline is completely normal for a company of their size.

Re: Why Wall Street is ignoring big tech's debt [video]

#152

Post by [deleted] »

amluto wrote: post #135
WarmWash wrote: post #9

I don't know a single white collar worker who isn't using AI for their job. Not like forced, but like "Oh damn, this bot thing can do a lot of tedious leg work for me". To think that people won't pay $60-$80/mo to continue using it is wild to me. In a white collar environment it pays for itself in a few hours of use. If you focus on how much value AI brings to people (mostly in time saved), the bubble hardly looks bu…

> Did Uber die when a trip across town went from $3 to $13? No. It's giving more rides than ever, 10x more than when it was $3. Uber has a fairly large moat: the regulatory mess they’ve waded through and the collection of drivers willing to drive for them. Sure, it’s probably easier to start a competitor now than 20 years ago, but there’s still a substantial network effect — a transportation service needs a lot of ca…

[deleted]

Re: Why Wall Street is ignoring big tech's debt [video]

#153

Post by tristanj »

sandcat_ wrote: post #145
amluto wrote: post #135

Earlier quoted context omitted.

> Did Uber die when a trip across town went from $3 to $13? No. It's giving more rides than ever, 10x more than when it was $3. Uber has a fairly large moat: the regulatory mess they’ve waded through and the collection of drivers willing to drive for them. Sure, it’s probably easier to start a competitor now than 20 years ago, but there’s still a substantial network effect — a transportation service needs a lot of ca…

There were so many comments[1][2][3] at the time saying that Uber has no moat, there’s no switching cost, the only value is the $3 rides, etc, etc. I suspect it’ll play out the same. [1] https://news.ycombinator.com/item?id=8987827 [2] https://news.ycombinator.com/item?id=6137542 [3] https://news.ycombinator.com/item?id=9984619

Agreed, ChatGPT has more than 900 million weekly active users. They're not losing the top spot anytime soon.

Re: Why Wall Street is ignoring big tech's debt [video]

#154

Post by porridgeraisin »

lefty2 wrote: post #110
porridgeraisin wrote: post #77

Earlier quoted context omitted.

They dont need to scale down anything. AGI is a red herring. Even Deepseek at its absurd prices is a very healthy business. Regarding their return on capex multiple, their CEO said they make a six-fold profit on their compute capex with 10 month recuperation. Because of this, all of them are spending aggressively on compute. Apart from that, user acquisition and data labelling are the major costs that are preventing…

> Even Deepseek at its absurd prices is a very healthy business. Regarding their return on capex multiple, their CEO said they make a six-fold profit on their compute capex with 10 month recuperation. That's "theoretical profit" - in some imaginary world where the free subscribers would pay the top tier cost. https://techcrunch.com/2025/03/01/deepseek-claims-theoretica...

I am not talkiong about that, I explicitly said a interview by the CEO. Which is here:

https://archive.is/NLuG9

Re: Why Wall Street is ignoring big tech's debt [video]

#155

Post by porridgeraisin »

thisisit wrote: post #114
porridgeraisin wrote: post #36

Earlier quoted context omitted.

> Even adding something like $20 - $100 subscriptions to every user is a serious enough financial obligation that it needs to go through budget planning / boards I doubt that. In my tiny town in India, office workers use the 1800 INR (20$) plans. 1800 INR/month is like... 4% of the salary these guys get. And since this is mostly MS-office and windows explorer and chrome based stuff in very small, non-tech companies,…

First I'd like to understand what are these "small" non-tech companies in tiny towns 45k to its employees? The last labor survey had average Indian salary pegged at 21k. > it pays for itself in literally a day Most comments in the thread say this but don't explain the how. How does it pay for itself "literally" in a day? Through productivity/time savings? How exactly? I can only assume people are talking about produc…

> Don't explain the how

They processed 10 cases in a day rather than 7. In some cases, new work took its place and the company makes a little bit more money, but this is a lagging effect naturally.

> Have their been reports of increased productivity or layoffs in tiny town, small non-tech companies in India that I am unaware of

PWC et al don't go around doing reports on these tiny companies bro. The only information you get is if you know people in that place and they tell you yourself, which is how I got to know.

> Given that everyone is on the AI hype train they might not be looking at the expenses closely

Yeah maybe F500 ceos exposed to LLM coding agents are on the hype train to some extent, but these M.S office pirating small companies are not on any hype train lol.

> The last labor survey had average Indian salary pegged at 21k.

Averaging across the whole of India gives you a useless number. In the richer regions, 21k is less than what a full time food delivery/quick commerce driver makes.

Re: Why Wall Street is ignoring big tech's debt [video]

#156

Post by thisisit »

porridgeraisin wrote: post #155
thisisit wrote: post #114

Earlier quoted context omitted.

First I'd like to understand what are these "small" non-tech companies in tiny towns 45k to its employees? The last labor survey had average Indian salary pegged at 21k. > it pays for itself in literally a day Most comments in the thread say this but don't explain the how. How does it pay for itself "literally" in a day? Through productivity/time savings? How exactly? I can only assume people are talking about produc…

> Don't explain the how They processed 10 cases in a day rather than 7. In some cases, new work took its place and the company makes a little bit more money, but this is a lagging effect naturally. > Have their been reports of increased productivity or layoffs in tiny town, small non-tech companies in India that I am unaware of PWC et al don't go around doing reports on these tiny companies bro. The only information…

> PWC et al don't go around doing reports on these tiny companies bro. The only information you get is if you know people in that place and they tell you yourself, which is how I got to know.

I knew the post screamed "trust me bro" vibes and now I know for sure. Government does Labor force surveys. Here's one for last year. Point me out how the participation is changing through AI paying for itself. https://www.pib.gov.in/PressReleasePage.aspx?PRID=2246009&re...

> Averaging across the whole of India gives you a useless number. In the richer regions, 21k is less than what a full time food delivery/quick commerce driver makes.

See the above survey for the figures. But then this is like someone using California to say how well America is doing.

Re: Why Wall Street is ignoring big tech's debt [video]

#157

Post by InsideOutSanta »

tristanj wrote: post #124
InsideOutSanta wrote: post #116

Earlier quoted context omitted.

If they were profitable, they'd release real numbers and announce concrete plans for an IPO. They are very obviously not profitable; they just announced a $65B Series H two months ago. They're almost literally setting money on fire.

Utterly false -- review the numbers yourself https://www.wsj.com/tech/ai/mind-blowing-growth-is-about-to-... https://newsletter.semianalysis.com/p/anthropic-3q26-profit-... The company was profitable in Q2 and is projected to exceed $1B in profit in Q3.

Not a single thing in my comment is false.

Re: Why Wall Street is ignoring big tech's debt [video]

#158

Post by wao0uuno »

api wrote: post #18
WarmWash wrote: post #9

I don't know a single white collar worker who isn't using AI for their job. Not like forced, but like "Oh damn, this bot thing can do a lot of tedious leg work for me". To think that people won't pay $60-$80/mo to continue using it is wild to me. In a white collar environment it pays for itself in a few hours of use. If you focus on how much value AI brings to people (mostly in time saved), the bubble hardly looks bu…

After using it a bit I’m convinced it’s not, as a whole, a bubble. Bubbles exist around it. Data center construction may end up overbuilding, much like the dark fiber thing during dot.com, since better chips and models will shrink power and space requirements over time. But the core tech is the most powerful new thing I have seen since discovering the Internet, at least. Maybe more.

This new technology more powerful than the internet can't answer the simplest questions straight. If this is the future then I don't want it. LLMs are pretty great at generating code and recognizing patterns and that's about it.

Re: Why Wall Street is ignoring big tech's debt [video]

#159

Post by harrouet »

WarmWash wrote: post #9

I don't know a single white collar worker who isn't using AI for their job. Not like forced, but like "Oh damn, this bot thing can do a lot of tedious leg work for me". To think that people won't pay $60-$80/mo to continue using it is wild to me. In a white collar environment it pays for itself in a few hours of use. If you focus on how much value AI brings to people (mostly in time saved), the bubble hardly looks bu…

Uber is the wrong example here, as it has destroyed $27B of value since inception.

Or maybe that's exactly the right example...

Re: Why Wall Street is ignoring big tech's debt [video]

#160

Post by InsideOutSanta »

tristanj wrote: post #151
stackskipton wrote: post #127

Earlier quoted context omitted.

I can't read the first article 100% but it's linked here: https://www.wheresyoured.at/anthropics-profitability-swindle... which I noted in my original post seems to be full of juiced numbers. Second link talks about revenue and operating costs. Again, it's very possible that Anthropic is profitable as I hinted looking at pure revenue vs operating costs. That's like saying your delivery service is profitable because y…

1) Ed Zitron has one of the worst track records in the AI space. He's consistently wrong about everything. Every major prediction he has made over the past five years has aged terribly. 2) After calling the doom of OpenAI and Anthropic for half a decade, Zitron pivoted this year into accusing these companies of financial engineering and fraud. I have read the "article" you linked and he makes this accusation with no…

Anthropic has not released an official EBITDA figure.
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