141–150 of 229 posts
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.
(Is there a more extreme example so far of this than AI companies, just in terms of raw losses? As far as I know, Netscape's lifetime losses as an independent company "only" total a bit over $100 million dollars, which is a lot, it just doesn't look like all that much when put into perspective...)
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.
We go through this with every startup cycle. Startups are not expected to be profitable because they’re spending so much money on growth and R&D. The concept of running a business in an intentionally unprofitable state is confusing to those who don’t understand startup funding. The weird thing is that so many people believe that inference is unprofitable. There are large open weights models that companies run at a pr…
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We go through this with every startup cycle. Startups are not expected to be profitable because they’re spending so much money on growth and R&D. The concept of running a business in an intentionally unprofitable state is confusing to those who don’t understand startup funding. The weird thing is that so many people believe that inference is unprofitable. There are large open weights models that companies run at a pr…
> There are large open weights models that companies run at a profit while charging far less than what OpenAI and Anthropic charge. You have no idea whether those companies are making a profit. 1. All it takes is one of them operating a loss to gain market share to force the other ones to lower prices to compete. 2. There’s not reason to expect that these relatively small companies are correctly pricing GPU depreciat…
I doubt the various providers on OpenRouter are benevolently operating at a loss because they’re so generous.
You can also calculate the cost to run these models yourself. They are open weight and the hardware required to run them is not a secret. They can be modeled and many have done the business modeling.
I’m always surprised at how many Hacker News commenters are unaware that a lot of financial modeling and analysis has been done on these companies and models. It’s naive to think the the hottest topic in tech has not already been dissected and analyzed by the finance industry at every level.
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We go through this with every startup cycle. Startups are not expected to be profitable because they’re spending so much money on growth and R&D. The concept of running a business in an intentionally unprofitable state is confusing to those who don’t understand startup funding. The weird thing is that so many people believe that inference is unprofitable. There are large open weights models that companies run at a pr…
> There are large open weights models that companies run at a profit while charging far less than what OpenAI and Anthropic charge. You have no idea whether those companies are making a profit. 1. All it takes is one of them operating a loss to gain market share to force the other ones to lower prices to compete. 2. There’s not reason to expect that these relatively small companies are correctly pricing GPU depreciat…
AMD, Alibaba should be on there too. AMD is making good money on AI, with R&D at less than half the AI revenue. Whereas Alibaba's weird financials show it's kinda-sorta-protifable? 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…
The frontier labs have fantastic margin on inference. You do not understand how fantastic. And they have license to change inputs at will based on profitability.
They are not only innovating on models and tooling, they are innovating on cogs (I wrote this btw, and I’m not going to stop writing this way because Claude discovered it’s brilliant).
Speaking of models, the cost of training is not scaling nearly as fast as demand for inference. Training used to be the biggest cost by far, now it’s not.
So margin is increasing, and guess what else is happening? Customers are finding value. And the customers that are finding value are also the ones who happen to have huge enterprise budgets.
And while this is happening, so is implicit collusion (and lock in, and hype, and all that). And so prices are going up.
They’re going to be just fine man, there is no inference bubble.
They can modulate supply. It’s all going to be fine. You should invest.
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dot-com bubble? It's less about black or white, and more about how much of it. Nothing weird to me about caring given how it all also impacts peoples lives and much wilder all these numbers are becoming.
Difference is that Amazon, Microsoft, Google or Oracle are not going out of business if it all collapses. Neither chip or hardware manufacturers will be harmed.
Anthropic is going to be profitable in the June quarter https://www.cnbc.com/2026/05/20/anthropic-revenue-explosive-...
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Right, especially given that majority of this investment is into GPUs and data centers that are amortized over a longer period of time. This is actually very hopeful. Given how the curves look like in terms of ramping of spend, these are very healthy numbers.
'Long', as in 1-3 years? ( https://www.tomshardware.com/pc-components/gpus/datacenter-g... )
https://cloud.google.com/tpu/pricing https://en.wikipedia.org/wiki/Tensor_Processing_Unit#Second_...
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If OpenAI and Anthropic adopted GAAP nobody would be able to invest in them it would be so bad
Yeah, institutional investors who plowed billions into them are unsophisticated rubes who got hoodwinked because they don't get GAAP. And it's not like both OpenAI and Anthropic are both going to IPO soon which would require disclosures far beyond GAAP numbers. /s