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> can kill any profit margins for the product as a whole.

Especially when the base line profit margin is negative to begin with



Is there any evidence to suggest this is true? IIRC there was leaked information that OpenAI's revenue was significantly higher than their compute spending, but it wasn't broken down between API and subscriptions so maybe that's just due to people who subscribe and then use it a few times a month.


> OpenAI's revenue was significantly higher than their compute spending

I find this difficult believe, although I don't doubt leaks could have implied it. The challenge is that "the cost of compute" can vary greatly based on how it's accounted for (things like amortization, revenue recognition, capex vs opex, IP attribution, leasing, etc). Sort of like how Hollywood studio accounting can show a movie as profitable or unprofitable, depending on how "profit" is defined and how expenses are treated.

Given how much all those details can impact the outcome, to be credible I'd need a lot more specifics than a typical leak includes.


> Is there any evidence to suggest this is true?

I can't find any sources _not_ mentioning billions of loss for 2024 and for the foreseeable future




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