Edi Zitron has an exclusive report on OpenAI’s 2025 finances:
The financial condition of OpenAI is deeply concerning. $38.53 billion in losses are astronomical, and far higher than most believed it would be. Losses also appear to be mounting year-over-year at a dramatic rate, and I’m not sure how this company finds a way toward any kind of sustainability or profitability.
How does this work? If I make less money than I spend, I’ll end up bankrupt with all my possessions sold and possibly in prison. They can’t be able to pay the suppliers. How are they still a working company? I really hope all of the AI bullshit goes bankrupt.
for now? they are floating on vc money, but their losses are so monstrously huge that they spent good chunk of all of it available worldwide. the way they got it was by promising replacement of work by their bots, aided by captive press and six billion marketing budget from openai alone. but they don’t have plan to get profitable, and when money influx stops they’re cooked like nobody before has been
They borrowed money from their suppliers, who all made investments in each other. The Open AI invests in the suppliers. Infinite money glitch lol.
But you can’t invest more than what was invested into your business, unless you somehow create money out of nothing. How did that part happen? Or did their suppliers seriously let them put all their billions of dollars worth of shit on a tab like in a bar?
You definitely can invest more. Leverage is a thing, allowing a company to exceed its available assets for an investment they believe they can make even more money on.
Highly leveraged companies (used to) be seen as risky. But we live in strange times and sophisticated investors don’t seem to care anymore …
I don’t get it. So, investors just pay with promises these days? Promises all the way along the chain? It’s like the industry is its own bank system.