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It’s weird to me that people here suddenly seem to care about profitability for relatively early stage companies just because they’re “AI”. I know a traditional SaaS company I worked for that IPO’d years ago and still has no signs that they can be profitable (and many others like it) and nobody seems particularly concerned.
For a rapidly growing new line of business, this isn't bad at all.
Yeah, my first impression when I saw this was: if this is accurate, the situation is not nearly as bad as I thought. I do wonder why Nvida is included, though. If you include the company that all of the frontier models are pouring money into, of course the net (expenditure - profits) of the collective is going to be closer to zero :-)
If Nvidia is included, does that mean that the money Amazon, Microsoft, and Oracle get for selling compute to the frontier models are included in their revenue?
Because for Amazon in particular, the situation this pages shows is actually much WORSE than I expected. I thought they were making a killing selling compute for model training.
It’s weird to me that people here suddenly seem to care about profitability for relatively early stage companies just because they’re “AI”. I know a traditional SaaS company I worked for that IPO’d years ago and still has no signs that they can be profitable (and many others like it) and nobody seems particularly concerned.
It’s weird to me that people here suddenly seem to care about profitability for relatively early stage companies just because they’re “AI”. I know a traditional SaaS company I worked for that IPO’d years ago and still has no signs that they can be profitable (and many others like it) and nobody seems particularly concerned.
I just wanna know how the OpenAI/Anthropic shell game works long-term. So both companies made equity deals with infrastructure providers; OpenAI on Azure, Anthropic on AWS, GCloud, and Colossus. They get a loan of compute credits and then pay for the compute with the credits. So the PaaS are effectively giving them free compute, then book it as revenue; and the AI provider lets them do inference and books that as revenue. So, it's like both types of company have a buffet, and let each other eat there for free. But somebody has to actually buy the pasta salad, with real dollars. Afaict, those real dollars are.... the cash reserves of the PaaS.
How long are they going to eat into that cash? Microsoft and AWS don't really have their own models, whereas Google and SpaceX do. And while Google has tons of cash, SpaceX is perpetually looking for cash. So the only player here that can actually afford to keep doing this, or leave the game entirely, is Google.
It’s weird to me that people here suddenly seem to care about profitability for relatively early stage companies just because they’re “AI”. I know a traditional SaaS company I worked for that IPO’d years ago and still has no signs that they can be profitable (and many others like it) and nobody seems particularly concerned.
To be honest whatever author wanted to say there three categories of AI related companies: hardware manufacturers, cloud providers and purely AI companies. Only the later have something to lose if AI bubble gone by tomorrow. Everyone else will just stay with grown capacity and reuse infrastructure for whatever. Not listing other hardware companies is just dishinest. AI is not a crypto mining where resources are just…
> Not listing other hardware companies is just dishinest. AI is not a crypto mining where resources are just burned. AI is exactly like crypto mining in that Nvidia is the one who profited from both
No matter what happen with the AI bubble text, image and video and other generative neural networks are here to stay.
Whatever you like it or not this tech already changed a lot of industries and there is no going back.
For a rapidly growing new line of business, this isn't bad at all.
Given how the curves look like in terms of ramping of spend, these are very healthy numbers.