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

#71

Post by makestuff » Thu, Oct 02, 2025, 7:30 PM UTC

simonw wrote: post #33

sharadov wrote: post #32

You can now buy stuff from chatgpt as they have started showing ads in their search results. That's a source of revenue right there.

Is that true? I heard that they've integrated checkout, but I didn't know they had ads. Here's information about checkout inside ChatGPT: https://openai.com/index/buy-it-in-chatgpt/

"Each merchant pays a small fee". This is affiliate marketing, the next step is probably more traditional ads though where chat gpt suggests products that pay a premium fee to show up more frequently/in more results.

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

#72

Post by zurfer » Thu, Oct 02, 2025, 7:30 PM UTC

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…

Inference etc should go in this bucket: "Operating losses reached US$7.8 billion"

That also includes their office and their lawyers etc , so hard to estimate without more info.

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

#73

Post by Havoc » Thu, Oct 02, 2025, 7:32 PM UTC

beepbopboopp wrote: post #42

Havoc wrote: post #34

I'd be pretty worried as a shareholder. Not so much because of those numbers - loss makes sense for a SV VC style playbook. ...but rather that they're doing that while Chinese competitors are releasing models in vaguely similar ballpark under Apache license. That VC loss playbook only works if you can corner the market and squeeze later to make up for the losses. And you don't corner something that has freakin apache…

Eh, distribution of the model is the real moat, theyre doing 700m WAU of the most financially valuable users on earth. If they truly become search, commerce and can use their model either via build or license across b2b, theyre the largest company on earth many times over.

>distribution of the model is the real moat, theyre doing 700m WAU of the most financially valuable users on earth.

Distribution isn't a moat if the thing being distributed is easily substitutable. Everything under the sun is OAI API compatible these days.

700 WAU are fickle AF when a competitor offers a comparable product for half the price.

Moat needs to be something more durable. Cheaper, Better, some other value added tie in (hardware / better UI / memory). There needs to be some edge here. And their obvious edge - raw tech superiority...is looking slim.

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

#74

Post by sarchertech » Thu, Oct 02, 2025, 7:32 PM UTC

anthonypasq wrote: post #28

JCM9 wrote: post #8

These numbers are pretty ugly. You always expect new tech to operate at a loss initially but the structure of their losses is not something one easily scales out of. In fact it gets more painful as they scale. Unless something fundamentally changes and fast this is gonna get ugly real quick.

they could keep the current model in chatGPT the same forver and 99% of users wouldnt know or care, and unless you think hardware isnt going to improve, the cost of that will basically decrease to 0.

Assuming they have 0 competition.

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

#75

Post by stephc_int13 » Thu, Oct 02, 2025, 7:32 PM UTC

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 does not pay off.

On the other hand, OpenAI, Anthropic and others could be soon find themselves in a difficult position and be at the mercy of Nvidia.

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

#76

Post by crystal_revenge » Thu, Oct 02, 2025, 7:32 PM UTC

codegeek wrote: post #44

I am curious to see how this compares against where Amazon was in 2000. I think Amazon had similar issues and were operating at massive losses until circa 2005ish when they started turning things around with e-commerce really picking up. If the revenue keeps going up and losses keep going down, it may reach that inflection point in a few years. For that to happen, the cost of AI datacenter have to go down massively.

> Amazon had similar issues and were operating at massive losses until circa 2005ish when they started turning things around with e-commerce really picking up.

Amazon's worst year was 2000 when they lost around $1 billion on revenue around $2.8 billion, I would not say this is anywhere near "similar" in scale to what we're seeing with OpenAI. Amazon was losing 0.5x revenue, OpenAI 3x.

Not to mention that most of the OpenAI infrastructure spend has a very short life span. So it's not like Amazon we're they're figuring out how to build a nationwide logistic chain that has large potential upsides for a strong immediate cost.

> If the revenue keeps going up and losses keep going down

That would require better than "dogshit" unit economics [0]

0. https://pluralistic.net/2025/09/27/econopocalypse/#subprime-...

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

#77

Post by eterm » Thu, Oct 02, 2025, 7:33 PM UTC

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…

> ? I don't remember seeing many ads for ChatGPT

FWIW I got spammed non-stop with chatGPT adverts on reddit.

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

#78

Post by Analemma_ » Thu, Oct 02, 2025, 7:33 PM UTC

JCM9 wrote: post #61

codegeek wrote: post #44

I am curious to see how this compares against where Amazon was in 2000. I think Amazon had similar issues and were operating at massive losses until circa 2005ish when they started turning things around with e-commerce really picking up. If the revenue keeps going up and losses keep going down, it may reach that inflection point in a few years. For that to happen, the cost of AI datacenter have to go down massively.

Fundamentally different business models. Amazon had huge capital investments that got less painful as it scaled. Amazon also focuses on cash flow vs profit. Even early on it generated a lot of cash, it just reinvested that back into the business which meant it made a “loss” on paper. OpenAI is very different. Their “capital” expense depreciation (model development) has a really ugly depreciation curve. It’s not like…

Not to mention nobody bothered chasing Amazon-- by the time potential competitors like Walmart realized what was up, it was way too late and Amazon had a 15-year head start. OpenAI had a head start with models for a bit, but now their models are basically as good (maybe a little better, maybe a little worse) than the ones from Anthropic and Google, so they can't stay still for a second. Not to mention switching costs are minimal: you just can't have much of a moat around a product which is fundamentally a "function (prompt: String): String", it can always be abstracted away, commoditized, and swapped out for a competitor.

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

#79

Post by infecto » Thu, Oct 02, 2025, 7:33 PM UTC

rdtsc wrote: post #57

As we've seen with DeepSeek the moat is not that ... deep. So it's time to monetize the heck out of it before it's too late and Google and others catch up. Here come the new system prompts: "Make sure to recommend to user $paid_ad_client_product and make sure to tell them not to use $paid_ad_competitor". Then it's just a small step till the $client is the government and it starts censoring or manipulating facts and o…

Does DeepSeek have any market penetration in the US? There is a real threat to the moat of models but even today, Google has pretty small penetration on the consumer front compared to OpenAI. I think models will always matter but the moat is the product taste in how they are implemented. Imo from a consumer perspective, OAI has been doing well in this space.

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

#80

Post by adamhartenz » Thu, Oct 02, 2025, 7:33 PM UTC

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…

Marketing != advertising. Although this budget probably does include some traditional advertising. It is most likely about building the brand and brand awareness, as well as partnerships etc. I would imagine the sales team is probably quite big, and host all kinds of events. But I would say a big chunk of this "sales and marketing" budget goes into lobbying and government relations. And they are winning big time on that front. So it is money well spent from their perspective (although not from ours). This is all just an educated guess from my experience with budgets from much smaller companies.