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OpenAI closes funding round at an $852B valuation

cnbc.com

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Re: OpenAI closes funding round at an $852B valuation

#521

Post by aurareturn »

adgjlsfhk1 wrote: post #441
aurareturn wrote: post #216

Earlier quoted context omitted.

How do you distill when OpenAI and Anthropic inevitably move to tasks running in the cloud? IE. Go buy this extremely hard to get concert ticket for me. Distilling might only be effective in the chat bot dominant era. We are about to move to an agents era. Furthermore, I’m guessing distilling will get harder and harder. Claude Code leak shows some primitive anti distilling methods already. There’s research showing th…

even ignoring distillation, so long as hardware or ml get better over time, training a new model from scratch is cheaper the later you do it

If hardware gets better over time, they also get better for OpenAI.

Re: OpenAI closes funding round at an $852B valuation

#522

Post by aurareturn »

dionidium wrote: post #461
aurareturn wrote: post #185

Earlier quoted context omitted.

How did Uber somewhat break even? They lost $34b before making a profit. Uber was only on a path to monopoly in the US, not world wide. It’s lost to local competitors in most countries. And it can get disrupted by self driving cars soon. OpenAI’s SOTA LLM training smells like a natural monopoly or duopoly to me. The cost to train the smartest models keep increasing. Most competitors will bow out as they do not have t…

> How did Uber somewhat break even? They lost $34b before making a profit. It took them ~14 years to lose that $34 billion. Some projections suggest that OpenAI has lost a third of that in a single quarter. Even the most optimistic projections indicate that they're losing that much every 2-3 years. There's talk that they might lose ~$150B before profitability. These are just numbers on a page to regular people, but $…

Uber is a taxi company hoping for a monopoly in the US. OpenAI is a software company hoping for a monopoly in many counties.

Re: OpenAI closes funding round at an $852B valuation

#523

Post by LEDThereBeLight »

podgietaru wrote: post #108
simianwords wrote: post #73

Earlier quoted context omitted.

I think you lack imagination. This is going to be the future because it is legitimately a step up from the previous ways of doing things. I can do things that were way more difficult before. It doesn't have to be AI all the way - no one's asking AI to book things on its own and make the payments on their own. What does work is, make AI do the research and you verify and you do the payment. Human in the loop. To me th…

Maybe there's a scenario where that is useful. But again, I don't know why I'd want an AI to do this research for me. I hop on Skyscanner. I type my location, and where I'd like to go. It presents me with a list of options, and I can then use the filters to find times that work best for me. I see a flight that isn't in my time frame, but is actually like 400 euros cheaper. And I decide in that moment that waking up a…

Right now, you’d use skyscanner directly for finding flights. Maybe Expedia for hotels. What if instead of needing to know about what app to use for every different type of thing you wanted to book, and dealing with their own separate UIs and dark patterns to upsell you, you just ask ChatGPT to curate a list for you, and then tell it to book once you’ve chosen?

In 20 years, we may not be writing UIs for apps anymore. We may just be writing tools for AI agents to consume.

Re: OpenAI closes funding round at an $852B valuation

#524

Post by vlovich123 »

aurareturn wrote: post #521
adgjlsfhk1 wrote: post #441

Earlier quoted context omitted.

even ignoring distillation, so long as hardware or ml get better over time, training a new model from scratch is cheaper the later you do it

If hardware gets better over time, they also get better for OpenAI.

It does, but for what it’s worth they have tech and financial tech of their past to pay down. This is how startups disrupt incumbents

Re: OpenAI closes funding round at an $852B valuation

#526

Post by Breza »

ajam1507 wrote: post #506
avaer wrote: post #28

This announcement completes the betrayal of their founding principles. "Our goal is to advance digital intelligence in the way that is most likely to benefit humanity as a whole, unconstrained by a need to generate financial return." - Not advancing digital intelligence - While locking people into a superapp - Because they are further constrained to generating financial returns

That was before they knew AI needed a bunch of money.

I'm not excusing Altman's many many lies, but it is worth noting how many algorithmic advances in the past 20 years were made with relatively little computing power. Think of things like xgboost (2016). A modest computer can run a pretty big dataset on CPU. When Tensorflow was launched in 2015, I played with it on an ancient laptop and it worked just fine. Then I upgraded to a mobile workstation and was still able to keep up with many SOTA models. Turns out LLMs are massively more power hungry than most earlier algorithms, even in NLP.

Re: OpenAI closes funding round at an $852B valuation

#527

Post by Breza »

walthamstow wrote: post #377
bigwheels wrote: post #249

Earlier quoted context omitted.

"It's not X, it's Y." A linguistic presentation commonly referred to as constrastive negation .

Humans may use commas here, but LLMs always use a full stop, always.

I wonder if there's a single trainer in Kenya who is responsible for some of the conventions we see so often. Maybe (s)he just really likes full stops and used them in all of the training examples.

Re: OpenAI closes funding round at an $852B valuation

#528

Post by robertozoia »

aurareturn wrote: post #58

$2b/month which is $24b/year. Not as much as I expected considering they were at $20b by end of 2025.[0] They only added $4b since? Anthropic had $19b by end of February 2026 and they added $6b in February alone.[1] This means if they added another $6b in March, they're higher than OpenAI already. However, I heard that OpenAI and Anthropic report revenue in a different way. OpenAI takes 20% of revenue from Azure sale…

$20b is December 2025 revenue multiplied by 12. Actual 2025 annual booked revenue is more in the order of $13b[0].

Also, those $122b raised are not cash-in-hand.

For example, NVIDIA commits to $30b, but OpenAI must build 5gw inference+training capacity using NVIDIA's Ruby Vera systems. NVIDIA's Huang has said[1] that in 1gw of compute, around $35b are NVIDIA hardware. So that $30b investment from NVIDIA goes back to NVIDIA as $175b in revenue. (Besides, NVIDIA gets non-voting shares in OpenAI.)

Deals like these are one of the few ways OpenAI can sustain growing in capacity, but it comes at a huge premium. That's one of the reasons they need the IPO, to get access to cheaper money.

[0]https://finance.yahoo.com/news/openai-is-the-2025-yahoo-fina...

[1]https://www.cnbc.com/2025/09/22/nvidia-openai-data-center.ht...

Re: OpenAI closes funding round at an $852B valuation

#529

Post by robertozoia »

sixtyj wrote: post #22

> Within a year of launching ChatGPT, we reached $1B in revenue. By the end of 2024 we were generating $1B per quarter. We are now generating $2B in revenue per month. They raised $122B. 122 / 12*2 = 5 years to get your money back (I simplify, I know revenue profit) They are so big that almost no one can afford to acquire them. It is similar as someone would like to acquire MSFT or AAPL. WCGW?

Revenue is on metric. Another important metric is gross margin. OpenAI's gross margin is estimated at 33%[0]. They also have to pay Microsoft 20% of revenue. So, for each $1 of revenue:

Revenue $1.00

COGS (inference) (0.67)

Microsoft (0.20)

Gross margin $0.13

That $0.13 must cover "everything else": R&D, payroll, etc., and ideally leave some profit on the table.

The problem for OpenAI (and other pure AI companies) is that inference is not like software that sells at marginal cost (build once, sell everywhere), but each token costs money. Inference gets cheaper, but newer models require more computing power and consume more tokens. So the gross margin does not improve over time.

Break-even in the future won't come from just growing API usage and subscriber base.

[0] https://sacra.com/c/openai/

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