OpenAI's H1 2025: $4.3B in income, $13.5B in loss • Hacker News Board

Re: OpenAI's H1 2025: $4.3B in income, $13.5B in loss

#301

Post by hx8 » Fri, Oct 03, 2025, 12:52 AM UTC

syntaxing wrote: post #294

imachine1980_ wrote: post #288

Earlier quoted context omitted.

I believe regular people will not change from chatGPT if it has some ads. I know people who use "alternative" wrappers that have ads because they aren't tech savvy, and I agree with the OP that this could be a significant amount of money We aren't 700 million people that use it.

Definitely don’t argue against that, once people get into a habit of using something, it takes quite a bit to get away from it. Just that an American startup can literally run ZLM models themselves (open weight with permissive license) as a competitor to ChatGPT is pretty wild to think about

One of the side effects of having a chat interface, is that there is no moat around it. Using it is natural.

Changing from Windows to Mac or iOS to Android requires changing the User Interface. All of these chat applications have essentially the same interface. Changing between ChatGPT and Claude is essentially like buying a different flavor of potato chip. There is some brand loyalty and user preference, but there is very little friction.

Re: OpenAI's H1 2025: $4.3B in income, $13.5B in loss

#302

Post by renewiltord » Fri, Oct 03, 2025, 12:52 AM UTC

jacquesm wrote: post #298

iambateman wrote: post #239

Earlier quoted context omitted.

I think this is directionally right but to nitpick…Google has way more trust than OpenAI right now and it’s not close. Acceleration is felt, not velocity.

I really don't trust either. Google because of what they've already done, OpenAI because it has a guy at the helm who doesn't know how to spell the word 'ethics'.

That's mostly because LLMs think in terms of tokens not letters, so spelling is hard.

Re: OpenAI's H1 2025: $4.3B in income, $13.5B in loss

#303

Post by aurareturn » Fri, Oct 03, 2025, 12:52 AM UTC

bcrl wrote: post #271

zdragnar wrote: post #244

Earlier quoted context omitted.

What is OpenAI's moat? There's plenty of competitors running their own models and tools. Sure, they have the ChatGPT name, but I don't see them massively out-competing the entire market unless the future model changes drastically improve over the 3->4->5 trajectory.

This! The cost of training models inevitably goes down over time as FLOPS/$ and PB/$ increases relentlessly thanks to the exponential gains of Moore's law. Eventually we will end up with laptops and phones being Good Enough to run models locally. Once that happens, any competitor in the space that decides to actively support running locally will have operating costs that are a mere fraction of OpenAI's current busine…

You just said that everyone will be able to run a powerful AI locally and then you said this would lead to a pop of the bubble.

Well, which is it? That AI is going to have huge demands for chips that it is going to get much bigger or is the bubble going to pop? You can’t have both.

My opinion is that local LLMs will do a bulk of the low value interference such as your personal life mundane tasks. But cloud AI will be reserved for work and for advanced research purposes.

Re: OpenAI's H1 2025: $4.3B in income, $13.5B in loss

#304

Post by wnevets » Fri, Oct 03, 2025, 12:52 AM UTC

nojs wrote: post #231

I think people are massively underestimating the money they will come from ads in the future. They generated $4.3B in revenue without any advertising program to monetise their 700 million weekly active users, most of whom use the free product. Google earns essentially all of its revenue from ads, $264B in 2024. ChatGPT has more consumer trust than Google at this point, and numerous ways of inserting sponsored results…

Banner ads would only be the start of the enshittification of AI chats. I can't wait for the bots to start recommending products and services of the highest bidder.

Re: OpenAI's H1 2025: $4.3B in income, $13.5B in loss

#305

Post by skeptrune » Fri, Oct 03, 2025, 12:54 AM UTC

Wait until they turn ads on.

Re: OpenAI's H1 2025: $4.3B in income, $13.5B in loss

#306

Post by babelfish » Fri, Oct 03, 2025, 12:59 AM UTC

runako wrote: post #184

apinstein wrote: post #166

Earlier quoted context omitted.

It’s not a hand wave… The cost to serve a particular level of AI drops by like 10x a year. AI has gotten good enough that next year people can continue to use the current gen AI but at that point it will be profitable. Probably 70%+ gross margin. Right now it’s a race for market share. But once that backs off, prices will adjust to profitability. Not unlike the Uber/Lyft wars.

The "hand wave" comment was more to preempt the common pushback that X has to get to scale for the economics to work. My contention is that 700m MAUs is "scale" so they need another lever to get to profit. > AI has gotten good enough that next year people can continue to use the current gen AI This is problematic because by next year, an OSS model will be as good. If they don't keep pushing the frontier, what competi…

The thing is consumers don't care about OSS models. Any non-technical person just wants to "use AI", and think of ChatGPT for that.

Re: OpenAI's H1 2025: $4.3B in income, $13.5B in loss

#307

Post by IncreasePosts » Fri, Oct 03, 2025, 1:04 AM UTC

deadbabe wrote: post #253

nojs wrote: post #231

I think people are massively underestimating the money they will come from ads in the future. They generated $4.3B in revenue without any advertising program to monetise their 700 million weekly active users, most of whom use the free product. Google earns essentially all of its revenue from ads, $264B in 2024. ChatGPT has more consumer trust than Google at this point, and numerous ways of inserting sponsored results…

In 10 years most serious users of AI will be using local LLMs on insanely powerful devices, with no ads. API based services will have limited horizon.

Ok, but there will be users using even more insanely powerful datacenter computers that will be able to our-AI the local AI users.

Re: OpenAI's H1 2025: $4.3B in income, $13.5B in loss

#308

Post by runako » Fri, Oct 03, 2025, 1:06 AM UTC

babelfish wrote: post #306

runako wrote: post #184

Earlier quoted context omitted.

The "hand wave" comment was more to preempt the common pushback that X has to get to scale for the economics to work. My contention is that 700m MAUs is "scale" so they need another lever to get to profit. > AI has gotten good enough that next year people can continue to use the current gen AI This is problematic because by next year, an OSS model will be as good. If they don't keep pushing the frontier, what competi…

The thing is consumers don't care about OSS models. Any non-technical person just wants to "use AI", and think of ChatGPT for that.

Right, the model is a commodity to most users. So all things equal, a ChatGPT clone that costs (say) 70% less will steal share.

Flipping it again: if the model is a commodity that lets one "use AI," why would anyone pay 2x or 3x as more to use ChatGPT?

Re: OpenAI's H1 2025: $4.3B in income, $13.5B in loss

#309

Post by Lalo-ATX » Fri, Oct 03, 2025, 1:06 AM UTC

LarsDu88 wrote: post #197

stephc_int13 wrote: post #75

Everyone is trying to compare AI companies with something that happened in the past, but I don't think we can predict much from that. GPUs are not railroads or fiber optics. The cost structure of ChatGPT and other LLM based services is entirely different than web, they are very expensive to build but also cost a lot to serve. Companies like Meta, Microsoft, Amazon, Google would all survive if their massive investment…

If you build the actual datacenter, less than half the cost is the actual compute. The other half is the actual datacenter infrastructure, power infrastructure, and cooling. So in that sense it's not that much different from Meta and Google which also used server infrastructure that depreciated over time. The difference is that I believe Meta and Google made money hand over fist even in their earliest days.

Last time i ran the numbers -

Data center facilities are ~$10k per kW

IT gear is like $20k-$50k per kW

Data center gear is good for 15-30 years. IT is like 2-6ish.

Would love to see updated numbers. Got any?

Re: OpenAI's H1 2025: $4.3B in income, $13.5B in loss

#310

Post by MontyCarloHall » Fri, Oct 03, 2025, 1:06 AM UTC

nojs wrote: post #231

I think people are massively underestimating the money they will come from ads in the future. They generated $4.3B in revenue without any advertising program to monetise their 700 million weekly active users, most of whom use the free product. Google earns essentially all of its revenue from ads, $264B in 2024. ChatGPT has more consumer trust than Google at this point, and numerous ways of inserting sponsored results…

I also wonder if this means that even paid tiers will get ads. Google's ad revenue is only ~$30 per user per year, yet there is no paid, ad-free Google Premium, even though lots of users would gladly pay way more than $30/year have an ad-free experience. There's no Google Premium because Google's ad revenue isn't uniformly distributed across users; it's heavily skewed towards the wealthiest users, exactly the users most likely to purchase an ad-free experience. In order to recoup the lost ad revenue from those wealthy users, Google would have to charge something exorbitant, which nobody would be willing to pay.

I fear the same will happen with chatbots. The users paying $20 or $200/month for premium tiers of ChatGPT are precisely the ones you don't want to exclude from generating ad revenue.