OpenAI's cash burn will be one of the big bubble questions of 2026 • Hacker News Board

Re: OpenAI's cash burn will be one of the big bubble questions of 2026

#71

Post by slashdave » Tue, Dec 30, 2025, 11:19 PM UTC

mvkel wrote: post #27

The fact is nobody has any idea what OpenAI's cash burn is. Measuring how much they're raising is not an adequate proxy. For all we know, they could be accumulating capital to weather an AI winter. It's also worth noting that OpenAI has not trained a new model since gpt4o (all subsequent models are routing systems and prompt chains built on top of 4), so the idea of OpenAI being stuck in some kind of runaway training…

> they could be accumulating capital to weather an AI winter

Doubtful. This would be the very antithesis of the Silicon Valley way.

Re: OpenAI's cash burn will be one of the big bubble questions of 2026

#72

Post by ajross » Tue, Dec 30, 2025, 11:20 PM UTC

mvkel wrote: post #27

The fact is nobody has any idea what OpenAI's cash burn is. Measuring how much they're raising is not an adequate proxy. For all we know, they could be accumulating capital to weather an AI winter. It's also worth noting that OpenAI has not trained a new model since gpt4o (all subsequent models are routing systems and prompt chains built on top of 4), so the idea of OpenAI being stuck in some kind of runaway training…

> The fact is nobody has any idea what OpenAI's cash burn is.

Their investors surely do (absent outrageous fraud).

> For all we know, they could be accumulating capital to weather an AI winter.

If they were, their investors would be freaking out (or complicit in the resulting fraud). This seems unlikely. In point of fact it seems like they're playing commodities market-cornering games[1] with their excess cash, which implies strongly that they know how to spend it even if they don't have anything useful to spend it on.

[1] Again c.f. fraud

Re: OpenAI's cash burn will be one of the big bubble questions of 2026

#73

Post by JoshTriplett » Tue, Dec 30, 2025, 11:22 PM UTC

andsoitis wrote: post #5

In a parallel universe, governments invest in the compute/datacenters (read: infra), and let model makers compete on the same playing field.

In a better parallel universe, we found a different innovation without using brute-force computation to train systems that unreliably and inefficiently compute things and still leaves us able to understand what we're building.

Re: OpenAI's cash burn will be one of the big bubble questions of 2026

#74

Post by reissbaker » Tue, Dec 30, 2025, 11:23 PM UTC

mvkel wrote: post #27

The fact is nobody has any idea what OpenAI's cash burn is. Measuring how much they're raising is not an adequate proxy. For all we know, they could be accumulating capital to weather an AI winter. It's also worth noting that OpenAI has not trained a new model since gpt4o (all subsequent models are routing systems and prompt chains built on top of 4), so the idea of OpenAI being stuck in some kind of runaway training…

The GPT-5 series is a new model, based on the o1/o3 series. It's very much inaccurate to say that it's a routing system and prompt chain built on top of 4o. 4o was not a reasoning model and reasoning prompts are very weak compared to actual RLVR training.

No one knows whether the base model has changed, but 4o was not a base model, and neither is 5.x. Although I would be kind of surprised if the base model hadn't also changed, FWIW: they've significantly advanced their synthetic data generation pipeline (as made obvious via their gpt-oss-120b release, which allegedly was entirely generated from their synthetic data pipelines), which is a little silly if they're not using it to augment pretraining/midtraining for the models they actually make money from. But either way, 5.x isn't just a prompt chain and routing on top of 4o.

Re: OpenAI's cash burn will be one of the big bubble questions of 2026

#75

Post by slashdave » Tue, Dec 30, 2025, 11:24 PM UTC

lexicality wrote: post #36

laweijfmvo wrote: post #4

why does the article used words like burn and incinerate, implying that OpenAI is somehow making money disappear or something? They’re spending it; someone is profiting here, even if it’s not OpenAI. Is it all Nvidia?

I suspect most of it is going to utilities for power, water and racking. That being said, if I was Sam Altman I'd also be stocking up on yachts, mansions and gold plated toilets while the books are still private. If there's $10bn a year in outgoings no one's going to notice a million here and there.

How many gold toilets do you need? I mean, I don't even own one.

Re: OpenAI's cash burn will be one of the big bubble questions of 2026

#76

Post by piskov » Tue, Dec 30, 2025, 11:24 PM UTC

password54321 wrote: post #49

Not sure why they put so much investment into videoSlop and imageSlop. Anthropic seems to be more focused at least.

Because as with the internet 99% of the usage won’t be for education, work, personal development, what have you. It will be for effing kitten videos and memes.

Re: OpenAI's cash burn will be one of the big bubble questions of 2026

#77

Post by dylan604 » Tue, Dec 30, 2025, 11:24 PM UTC

toxic72 wrote: post #57

bdangubic wrote: post #18

Earlier quoted context omitted.

not that I disagree but would it be fair to say though that we have seen this before where it turned out OK? say Uber? Amazon?

To my knowledge Amazon never debt financed their ops like this

Where did their financing come from then?

Re: OpenAI's cash burn will be one of the big bubble questions of 2026

#78

Post by super256 » Tue, Dec 30, 2025, 11:25 PM UTC

mvkel wrote: post #27

The fact is nobody has any idea what OpenAI's cash burn is. Measuring how much they're raising is not an adequate proxy. For all we know, they could be accumulating capital to weather an AI winter. It's also worth noting that OpenAI has not trained a new model since gpt4o (all subsequent models are routing systems and prompt chains built on top of 4), so the idea of OpenAI being stuck in some kind of runaway training…

I think you are messing up things here, and I think your comment is based on the article from semi analysis. [1]

It said: OpenAI’s leading researchers have not completed a successful full-scale pre-training run that was broadly deployed for a new frontier model since GPT-4o in May 2024, highlighting the significant technical hurdle that Google’s TPU fleet has managed to overcome.

However, pre-training run is the initial, from-scratch training of the base model. You say they only added routing and prompts, but that's not what the original article says. They most likely still have done a lot of fine tuning, RLHF, alignment and tool calling improvements. All that stuff is training too. And it is totally fine, just look at the great results they got with Codex-high.

If you got actually got what you said from a different source, please link it. I would like to read it. If you just messed things up, that's fine too.

[1] https://newsletter.semianalysis.com/p/tpuv7-google-takes-a-s...

Re: OpenAI's cash burn will be one of the big bubble questions of 2026

#79

Post by nine_k » Tue, Dec 30, 2025, 11:27 PM UTC

piskov wrote: post #76

password54321 wrote: post #49

Not sure why they put so much investment into videoSlop and imageSlop. Anthropic seems to be more focused at least.

Because as with the internet 99% of the usage won’t be for education, work, personal development, what have you. It will be for effing kitten videos and memes.

Are the posters of effing kitten videos a customer base with a significant LTV?

(The obvious well-paying market would be erotic / furry / porn, but it's too toxic to publicly touch, at least in the US.)

Re: OpenAI's cash burn will be one of the big bubble questions of 2026

#80

Post by nine_k » Tue, Dec 30, 2025, 11:29 PM UTC

3eb7988a1663 wrote: post #22

aucisson_masque wrote: post #12

Earlier quoted context omitted.

I’d rather stay far away from this parallel universe. Why would you want my money to be used to build datacenter that won’t benefit me ? I might use a LLM once a month, many people never use it. Let the one who use it pay for it.

You are already paying for several national lab HPC centers. These are used for government/university research - no idea if commercial interests can rent time on them. The big ones are running weather, astronomy simulations, nuclear explosions, biological sequencing, and so on.

Many more people materially benefit from e.g. good weather forecasts than form video slop generation.