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

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

#431

Post by what »

abaymado wrote: post #106
simonw wrote: post #58

I think the most interesting numbers in this piece (ignoring the stock compensation part) are: $4.3 billion in revenue - presumably from ChatGPT customers and API fees $6.7 billion spent on R&D $2 billion on sales and marketing - anyone got any idea what this is? I don't remember seeing many ads for ChatGPT but clearly I've not been paying attention in the right places. Open question for me: where does the cost of ru…

> $2 billion on sales and marketing - anyone got any idea what this is? I used to follow OpenAI on Instagram, all their posts were reposts from paid influencers making videos on "How to X with ChatGPT." Most videos were redundant, but I guess there are still billions of people that the product has yet to reach.

There’s a bunch of users here that are probably paid by them too.

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

#433

Post by catlifeonmars »

alex43578 wrote: post #366
MontyCarloHall wrote: post #310

Earlier quoted context omitted.

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 m…

"Lots of users would gladly pay way more than $30/year have an ad-free experience"? Outside of ads embedded in Google Maps, a free and simple install of Ublock Origin essentially eliminates ads in Search, YouTube, etc. I'd expect that just like Facebook, people would be very unwilling to pay for Google to eliminate ads, since right now they aren't even willing to add a browser extension.

Anecdata, but my nontechnical friends have never heard of uBlock origin. They all know about ad-free youtube.

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

#434

Post by almogo »

cool_dude85 wrote: post #328
yalogin wrote: post #311

I don’t think they care, worst case scenario they will just go public and dump it on the market. However the revenue generation aspect for llms is still in its infancy. The most obvious path for OpenAI is to become a search competitor to google, which is what perplexity states it is. So they will try to out do perplexity. All these companies will go vertical and become all encompassing.

I think trying to compete with Google in search is a big problem. First you have to deal with all the anticompetitive stuff they can do, since they control email and the browser and youtube etc. Second they could probably stand to cut the price of advertising by 5 times and still be turning a profit. Will ads in ChatGPT be profitable competing against Google search ads at 1/5 the price, hypothetically?

If they're better - yes. ChatGPT is a very different product from Google Search. Return on Ad Spend could be significantly higher than even Google/Meta/ByteDance can offer.

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

#435

Post by chii »

sharkweek wrote: post #408
rajaman0 wrote: post #371

Earlier quoted context omitted.

Consumer brand quality is so massively underrated by tech people. ChatGPT has a phenomenal brand. That's worth 100x more than "product stickiness". They have 700 million weekly users and growing much faster than Google. I think your points on Google being well positioned are apt for capitalization reasons, but only one company has consumer mindshare on "AI" and its the one with "ai" in its name.

I’ve got “normie” friends who I’d bet don’t even know that what Google has at the top of their search results is “AI” results and instead assume it’s just some extension of the normal search results we’ve all gotten used to (knowledge graph) Every one of them refers to using “ChatGPT” when talking about AI. How likely is it to stay that way? No idea, but OpenAI has clearly captured a notable amount of mindshare in th…

when people started referring to searching the internet as googling, they know their brand has made it.

It is the same with chatGPT.

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

#436

Post by crystal_revenge »

StopHammoTime wrote: post #415
crystal_revenge wrote: post #409

Earlier quoted context omitted.

> ads in the future. It boggles my mind that people still think advertising can be a major part of the economy. If AI is propping up the economy right now [0] how is it possible that the rest of the economy can possibly fund AI through profit sharing? That's fundamentally what advertising is: I give you a share of my revenue (hopefully from profits) in order to help increase my market share. The limit of what adverti…

You've run a false equivalency in your argument. Growth is not representative of the entire economy. The economy is, in aggregate, much more than tech - they have the biggest public companies which skews how people think. No exclusive sector makes up "most" of the economy, in fact the highest sector, which is finance only makes up 21% of the US economy. https://www.statista.com/statistics/248004/percentage-added-...

> Growth is not representative of the entire economy

Our entire economy is based on debt, it cannot function without growth. This is demonstrated by the fact that:

> in fact the highest sector, which is finance only makes up 21% of the US economy

Every cent earned by the finance sector boils down from being derived from debt (i.e. growth has to pay it off). You just pointed out the largest sector of our economy relies on rapid growth, and the majority of growth right now is coming from AI. AI, therefore, cannot derive the majority of it's value by cannibalizing the growth of other sectors because no other sector has sufficient growth the fund both AI, itself and the debt that needs to be repaid to make the entire thing make sense.

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

#437

Post by [deleted] »

sharkweek wrote: post #408
rajaman0 wrote: post #371

Earlier quoted context omitted.

Consumer brand quality is so massively underrated by tech people. ChatGPT has a phenomenal brand. That's worth 100x more than "product stickiness". They have 700 million weekly users and growing much faster than Google. I think your points on Google being well positioned are apt for capitalization reasons, but only one company has consumer mindshare on "AI" and its the one with "ai" in its name.

I’ve got “normie” friends who I’d bet don’t even know that what Google has at the top of their search results is “AI” results and instead assume it’s just some extension of the normal search results we’ve all gotten used to (knowledge graph) Every one of them refers to using “ChatGPT” when talking about AI. How likely is it to stay that way? No idea, but OpenAI has clearly captured a notable amount of mindshare in th…

[deleted]

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

#438

Post by 9rx »

jcranmer wrote: post #368
9rx wrote: post #176

Earlier quoted context omitted.

> How long did it take for 9 out of 10 of those rail lines to become nonviable? Records from the time are few and far between, but, from what I can tell, it looks like they likely weren't ever actually viable. The records do show that the railways were profitable for a short while, but it seems only because the government paid for the infrastructure. If they had to incur the capital expenditure themselves, the math d…

> The records do show that the railways were profitable for a short while, but it seems only because the government paid for the infrastructure. If they had to incur the capital expenditure themselves, the math doesn't look like it would math. Actually, governments in the US rarely actually provided any capital to the railroads. (Some state governments did provide some of the initial capital for the earliest railroad…

> Actually, governments in the US rarely actually provided any capital to the railroads.

Did I, uh, miss a big news announcement today or something? Yesterday "around my parts" wasn't located in the US. It most definitely wasn't located in the US when said rail lines were built. Which you even picked up on when you recognized that the story about those lines couldn't have reasonably been about somewhere in the US. You ended on a pretty fun story so I guess there is that, but the segue into it wins the strangest thing ever posted to HN award. Congrats?

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

#439

Post by MountDoom »

andyferris wrote: post #427
MountDoom wrote: post #405

Earlier quoted context omitted.

All of these teens use Google Docs instead of OpenAI Docs, Google Meet instead of OpenAI Meet, Gmail instead of OpenAI Mail, etc. I'm sure that far fewer people to go gemini.google.com than to chatgpt.com, but Google has LLMs seamlessly integrated in each of these products, and it's a part of people's workflows at school and at work. For a while, I was convinced that OpenAI had won and that Google won't be able to re…

I think the beneficiary is wrong here. Those teens will grow up to work for organizaitons using Azure AD, Windows, Office and OneDrive/SharePoint/Teams. If any company is going to get the windfall of "AI provider by default" it is going to be Microsoft. Possibly powered by OpenAI models running on Azure. Google could make a "better" (basically - more sublime) advertising platform but little to attract new users. Perh…

Possibly, but I don't think that Microsoft apps have the kind of a foothold in the corporate world that they used to have.

Sure, if you join a bank or a government agency, or a big company that's been around for 40+ years, you're probably gonna be using Microsoft products. But the bulk of startups, schools, and small businesses use Google products nowadays.

Judging by their MX record, OpenAI is a Google shop... so is Perplexity... so is Anthropic... so is Mistral.

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

#440

Post by eucyclos »

nilsbunger wrote: post #397
asa400 wrote: post #383

Earlier quoted context omitted.

I'm not saying you're wrong, but people said the same thing about Yahoo, Excite, Lycos, etc. in 1999. Interesting times, then and now.

I think the biggest risk to ChatGPT as a consumer brand is that they don’t own the device surface. Google / Microsoft / Apple could make great AI that’s infused in the OS / browser, eliminating the need to go to ChatGPT.

Since microsoft kinda sorta owns or is merging with openai it's probably already close to that... copilot is constantly down for me at least, but I assume that's not a hard thing to fix on Microsoft's end if it wants to start paying the server costs...
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