OpenAI closes funding round at an $852B valuation | Hacker News Reader

OpenAI closes funding round at an $852B valuation

cnbc.com

531 pointssurprisetalk497 comments

https://openai.com/index/accelerating-the-next-phase-ai

$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 sales and reports revenue on that 20%. Anthropic reports all revenue, including AWS's share.[2]

[0]https://www.reuters.com/business/openai-cfo-says-annualized-...

[1]https://finance.yahoo.com/news/anthropic-arr-surges-19-billi...

[2]https://x.com/EthanChoi7/status/2036638459868385394

They aren't reporting anything yet. What we hearing is just from news media who get their leaks/info from investors who get some form of IR reports/ presentation.

Both will do public reporting only when they IPO[4] and have regulatory requirement to do so every quarter. For private companies[1] reporting to investors there are no fixed rules really[3]

Even for public companies, there is fair amount of leeway on how GAAP[2]expects recognize revenue. The two ways you highlight is how you account for GMV- Gross Merchandise Value.

The operating margin becomes very less so multiples on absolute revenue gets impacted when you consider GMV as revenue.

For example if you consider GMV in revenue then AMZN only trades at ~3x ($2.25T/$~800B )to say MSFT($2.75T/$300B) and GOOG ($3.4T/$400B) who both trade at 9x their revenue.

While roughly similar in maturity, size, growth potential and even large overlap of directly competing businesses, there is huge (3x / 9x) difference because AMZN's number includes with GMV in retail that GOOG and MSFT do not have in same size in theirs.

---

[1] There are still a lot of rules reporting to IRS and other government entities, but that information we (and news media) get is from investors not leaks from government reporting - which would be typically be private and illegal to disclose to public.

[2] And the Big 4 who sign off on the audit for companies prefer to account for it.

[3] As long as it is not explicit fraud or cooking the books, i.e. they are transparent about their methods.

[4] Strictly this would be covered in the prospectus(S-1) few weeks before going public and that is first real look we get into the details.

Does the GAAP accounting matter if everyone passively buys shares due to the new fast entry rules, which corruptly will force us all to buy into these companies? The fundamentals and true value seem less relevant than ever:

https://www.benzinga.com/markets/tech/26/03/51248353/michael...

  They aren't reporting anything yet. What we hearing is just from news media who get their leaks/info from investors who get some form of IR reports/ presentation.

The $24b figure is literally in OpenAI's announcement.

The $19b ARR and $6b added in Feb came directly from Anthropic CEO recently.

$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...

30x revenues at 17% revenue growth is... aggressive.

Except it's not 100x revenues, and it's not 17% growth. I don't know where you got those numbers from?

The numbers OpenAI gave in the post would mean a 30x multiple pre-money. And the $20B -> $24B run-rate growth since the start of the year could plausibly mean anything from 110% to 200% annualized growth rate, depending on whether that happened over two or three months. The $24B is a lower bound as well, since they only gave use one significant digit for the monthly revenue.

> 17% revenue growth

I think ads is going to massively change this number.

And that is revenue only. In the past 15 or so years most US companies (and especially startups) always talk about revenue only. Wheras only profit should matter.

E.g. what good is 20 billion per year when "OpenAI is targeting roughly $600 billion in total compute spending through 2030". That is $150 billion per year?

The startup game is about building assets and then cashing out on them during exit.

Assets are harder to measure. Facebook used to say something silly like every user was worth $100. That sounded ridiculous for a completely free app but over a decade later, the company is worth more than that. Revenue is an easier way of measuring assets than profit.

Profit doesn't really matter. It gets taxed. But it's not about dodging taxes; it's because sitting on a pile of money is inefficient. They can hire people. They can buy hardware. They can give discounts to users with high CLTV. They can acquire instead of building. It's healthy to have profit close to $0, if not slightly negative. If revenues fall or costs increase, they can make up for the difference by just firing people or cutting unprofitable projects.

Also when they're raising money, it makes absolutely no sense to be profitable. If they were profitable, why would they raise money? Just use the profits.

> Wheras only profit should matter

Profit is money you couldn’t figure out how to spend. During growth, you want positive operating margins with nominal profits. When the company/market matures, you want pure profits because shareholders like money. If you can find a way to invest those profits in new areas of growth, that’s better.

It's not as much as you think. Google is spending $185b on data centers this year alone. Amazon is spending $200b this year. Total capex for big tech is ~$700b in 2026 and we're not including neo clouds, Chinese clouds, and other sovereign data centers.

Since everyone is trying to get compute from anywhere they can, including OpenAI going to Google, it's hard to tell what is used internally vs externally.

For example, it's entirely possible that Google's internal roadmap for Gemini sees it using $600b of compute through 2030 as well. In that case, OpenAI needs to match since compute is revenue.

Give me a billion and I'll have 500M of revenue in no time by selling dollars at 50 cents.

why should only profits matter? if i had a killer product today that i just need to sell tomorrow, wouldn't you still invest today knowing i'll probably only start to make money tomorrow (or perhaps next week)?

the expectation is that they'll eventually make money. they can't raise forever. only startups are not profitable for a few years. but most companies that have existed for a long while have been profitable

and since they're expected to make a LOT of money, everyone wants a piece of that future pie, pushing up the valuation and amount raised to admittedly somewhat delusional levels like here

What is the point - exactly - of profit?

Profit is money you can't find a use for to grow your business, so you give some of it to the government in the form of tax.

Also there is a big difference between operational expenses and capital expenses like building data centers.

I think OpenAI is being very aggressive on the growth vs conservative financial management spectrum but just saying "only profit should matter" is just wrong.

OpenAI is a few years behind Anthropic, and it's unlikely they'll catch up at this point.

Where exactly are they behind?

I'm following this very closly and i'm stunned. Any infos on why you think they are behind antrophic in years?

I do see less quality from reasoning at chatgpt compared to Gemini but otherwise i'm not seeing a year or years gap.

Anthropic is _unquestionably_ ahead product wise because of their agentic coding tools, but they are not _years_ ahead. In particular, their advantage is in the harness, which is not hard to replicate!

They’re about even in general, but for me OpenAI is slightly or significantly ahead in the areas I care about the most. E.g. claude code is a backend slop cannon if you don’t tell codex/gemini to review the outputs.

I'd be pretty cautious comparing those numbers directly

Still a huge amount of revenue for any company. Those $20/month fees are going to triple in a couple yrs. But the VCs expect much much more.

Friends of mine working in AI companies are saying we’ll be lucky if they only triple. More like 10-20x long term, especially for enterprise

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

Founding principles = initial marketing strategy

Is there a way out of this though? The seed is already planted and everything else is just a PR.

Not too dissimilar from what most companies that start prioritizing growth also do, unfortunately.

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.

> Today, we closed our latest funding round with $122 billion in committed capital at a post money valuation of $852 billion.

A couple things that stand out to me about this is the use of the phrase "committed capital", which only sounds like a promise that could break from various circumstances, and the valuation of their funding keeps changing so it sounds like a max rather than the valuation every investor invested at.

I do wonder how much of Amazon's $50B share (per last press release) is in AWS credits rather than money in the bank.

Probably a lot? It would be much more tax-advantageous to do it this way, $50B worth of credits != $50B worth of spend on Amazon's part, and they might meet in the middle about how much equity that translates to.

I can see a lot of advantages for Amazon, but I don't see why it would be tax-advantageous.

To then claim that Trainium is “selling” and not a dud? I’d bet a lot.

good catch! committed capital is not same as we raised.

It makes sense for such a huge amount to be "committed", not sitting idle in a bank somewhere.

That’s typical. Large funding rounds usually aren’t delivered as one single giant lump sum into the bank account. The capital is committed in stages that can depend on hitting milestones or goals.

This is done even in smaller startup funding rounds some times.

Fair, I think a lot of what I've been perceiving is the gymnastics in how funding and valuation and deals get reported. There ends up being a ton of asterisks that makes the headline news deviate quite significantly from reality, e.g. https://arstechnica.com/information-technology/2026/02/five-...

I assure you committed capital is very much common parlance in finance

that's why they have to open through banks and other less valuable more sliced share system.

I think this is more about deal structure than spin

The title is incorrect. The $122B includes previous promises. They raised an additional $12B of promises:

"The round totaled $122 billion of committed capital, up from the $110 billion figure that the company announced in February. SoftBank co-led the round alongside other investors, including Andreessen Horowitz and D. E. Shaw Ventures, OpenAI said."

This IPO, if anyone underwrites it, is going to fleece retail so hard. Better make it a SPAC with the help of Chamath and Cantor & Fitzgerald.

> The broad consumer reach of ChatGPT creates a powerful distribution channel into the workplace

They mention this line in different forms a couple of times in the article. It’s clear they’re pretty rattled about Anthropic’s momentum in enterprise, I wonder how confident they really are in this rationale.

It's an interesting strategy, I see a pretty big risk from them leaning into it like this. We already have a vibe in my circles of the old "gmail vs yahoo" type thing where if you saw someone had a yahoo mail address you assumed they were technologically illiterate. Similarly it's mildly embarrassing already to say you used ChatGPT for something. It's not unrecoverable, but it's a pretty steep slippery slope they probably don't want to be anywhere near if they care about enterprise.

After the DoD moves? It is not just the technologically illiterate, it is part of the US culture war. OpenAI is the MAGA brand, like tesla.

What an absurd leap. OpenAI is the maga brand because they simp for government contracts like any massive company would?

I don't know if it's guaranteed to work, but the strategy is real. I know Notion won vs. competitors in the space because they focused on consumer first, and consumers then brought Notion into their workplaces.

I am amused that you think IT is going to respond to an unmanaged LLM tool that operates outside of the LLM policies all serious enterprises have set up by now and say 'wow, that is cool and maybe we should buy in to this!'

What is going to happen is that the emplyee who tries to sneak OpenAI into our org is going to have two meetings set up by the end of the day, one with IT to ensure the whatever tool they installed is burned out with fire and one with HR to ensure they know the company policy and acknowledge that another fuck-up like this is a firing offense.

Isn't that exactly how the iPhone won though? As another commenter said, once the cool gadget becomes a must have for executives, IT will be told to find a way to make it work.

What if that employee is in the C-suite?

I don't read that as "rattled" so much as leaning into the one thing they clearly have that Anthropic doesn't: massive consumer distribution

Kind of makes me wonder how 'accelerated' the timeline of publishing this article was based upon the Claude Code leak today. Considering everyone has gotten a sneak peek at what Anthropic is working on OpenAI might be a little worried. This could also just be coincidence, but this piece really does read like self-encouraging fluff.

The timing of this coming out today is cause today is the last day of the month/quarter and has nothing to do with Claude.

Ah, yeah that makes way more sense, I always forget about financial quarter timings.

0. These things take an enormous amount of time and coordinating to release.

> This is not just product simplification. It is a distribution and deployment strategy.

iykyk

Are you suggesting this was written by AI?

You are absolutely right.

It’s not just a suggestion. It’s a demonstration.

And you are so bold for identifying it. You’re not just passively commenting. You’re creating something bigger, larger than yourself.

It's the demonstration layer

It's a very frequently used structure by LLMs especially ones writing for LinkedIn.

"It's not X, it's Y."

A linguistic presentation commonly referred to as constrastive negation.

Why would they not use their own AI?

No, they didn't raise $122B as the HN title implies. A big chunk of that $122B is a "maybe" that depends on various things that need to happen in the future.

Oh, man... I can't wait to see where this is going. Might not be pretty after all.

I've wondered how many announced fundraising rounds were like this. It's in everyone's interest (VCs and entrepreneurs) if the message to the outside world is "this company is amazing so they've raised a boatload of cash". But VCs might not want to give it all up front, or unconditionally.

It makes it hard to say what the valuation of a company is. If the milestones are unlikely to be hit, then it's anyone's guess.

This is a common structure. It's confusing to people who don't know finance or startups when they first see it.

Even VCs don't get all of their fund money delivered into their bank account when they raise a funding round. It's inefficient and undesirable for everyone involved to have to move all of the money up-front, at once.

If you talk to anyone in startup funding or finance they'll be familiar with the term "capital call" which describes how committed capital obligations are delivered at a later date than the initial deal: https://en.wikipedia.org/wiki/Capital_call

There's an accelerator here in Taiwan with a model I truly don't understand: 100k usd for 10%. 10%!! You've just valued the company at only 1 million! And taken a HUGE chunk of equity, not much left on the table!

Maybe it makes sustainable sense but in the world of venture capital it seems the most profitable thing to do is lie through a Cheshire grin, every day.

With NASDAQ and NYSE looking to reduce the timelines for new public companies to be included into indices (“fast entry” rule), I have a feeling that OpenAI and SpaceX and Anthropic are mostly looking to dump their inflated shares into the public’s retirement accounts by force.

Michael Burry called out this structural manipulation play recently:

https://www.benzinga.com/markets/tech/26/03/51248353/michael...

Retirement accounts aren't required to buy a stick just because it's listed.

... probably will though

that being said, how can Softbank keep throwing around all these astronomical numbers after so many bad investments? Leftover iPhone money?

Most people know Softbank as the company who lost billions on WeWork and not the company who made several more billions on the ARM IPO.

Their ~$50 million total Alibaba investment turned into ~$70 billion. As of two years ago they were still liquidating out of it.

January 26, 2024 - "Japanese investment holding firm SoftBank Group Corp has largely cleared its ownership in e-commerce giant Alibaba Group Holding, concluding one of the most successful deals in China's internet industry and a holding that spanned about 23 years."

"SoftBank, which invested US$20 million into Alibaba when it was still a start-up in 2000, said in a corporate filing on Thursday that it was set to book a gain of 1.26 trillion yen (US$8.5 billion) - about 425 times the value of its initial outlay - for the Tokyo-based firm's 2024 financial year after divesting its [remaining] shares via subsidiary Skybridge."

https://finance.yahoo.com/news/japans-softbank-concludes-run...

They borrowed $40B from JP Morgan. They literally did not have the money otherwise.

Saudi oil money

Having large funding rounds contingent on meeting milestones is common. Always has been.

It just makes comparing funding rounds hard to understand, since money in the bank is money in the bank, and a lot of the "committed capital if you reach a milestone" is capital that would be easy to get if you reached that milestone, if it is sufficiently advanced, and has enough outs, etc., that you may as well have just raised another round in the future.

The assumption that's conveniently left out is that the milestones are realistic

One of the stipulations is that OpenAI achieves "AGI"... Need I say more?

Also a lot of this "money" is in cloud compute and credits not cash so...

Why not announce the funding after the milestones have been met?

Don't let reality get in the way of vibes

It's also like... >$50 billion in compute credits and discounted hardware between Amazon/Microsoft/NVidia. Which is all inside baseball since they simultaneously juice their financials with OpenAI's cloud compute bill

Ok, let's switch to the HTML doc title above.

Probably again cancelled or significantly reduced in the near future when all the current investors inevitably cash out.

> No, they didn't raise $122B as the HN title implies.

What is this about? The title says "OpenAI closes funding round at an $852B valuation". It does not mention $122B.

Edit: the linked page's title is different and indeed states $122B.

Mods on HN sometimes change the titles of submissions to be more neutral but they generally start off as the linked article's title, which is what the comment you're replying to was referring to.

"Here comes another bubble..."

Seems like all of OpenAI's "deals" are announcement fodder with no real contract, primed to quietly fall through later.

Funny how quickly they have become like every other tech company. There is basically no hint of OpenAI the non-profit anymore.

Edit: Why did this go from their press release to a news story?

Frontier AI + tens of billions in capex was always going to end here

Sir, I'm sorry to be the one to tell you this. But you've been in a coma since 2022 after a severe car accident.

It's now the year 2026. That dead horse has already been beaten.

They were trying to keep the facade up until they were allowed to become a public benefit corporation. At least that's the way it seemed to me. Now they are fully mask off.

LLMs are definitely a game changing technology, but there is just so much fake money in the market right now (circular deals, paper valuations, etc.) that I cannot take this seriously. At some point the musical chairs will stop and we will all be saying how could we let this happen? Where are the regulators (rhetorical question)?

As with every bubble, we, the people, will pay for it. There will be recession, inflation and general "one step back" to hopefully move "two steps forward" one day in the future.

I think AI will actually produce price deflation in some areas. There could be inflation based on mechanisms you describe, but it's obviously making it cheaper to make some products/services.

This has to be just an extension of their previous raise, right? This was a month ago: https://openai.com/index/scaling-ai-for-everyone/

Maybe? Previous valuation is $730B + $122B raised in this announcement = $852B valuation in this announcement (no actual increase in valuation)

Previous was $730B pre money. This one is $852B post money. So yeah it's the same one. Good catch.

yup and begging for retailers money.

Doesn't look like it, that previous round was entirely Softbank + Nvidia + Amazon, while this one is VC + private investors.

The valuation seems odd though, you'd expect $840B post-money from that earlier round?

I'm old enough to remember when companies worth $1 billion were called "unicorns." Now we have a company raising 122 times that? Valued at nearly 1000 times that...?

At least they're throwing consumers a bone via the ARK deal. It's crazy how little AI exposure is available to anyone who isn't already wealthy and/or connected.

I think this is reality-distortion field rivaling that of Jobs', and a crisis of faith. Nobody apparently believes that capital is worth investing into anything but AI.

> Nobody apparently believes that capital is worth investing into anything but AI.

This is the main reason we see this insane investment into AI imo. If you imagine having lots of money, where should you invest that currently?

Housing market: Seems very overvalued (at least in germany). Also with the current uncertainty and inflation its hard to make an investment that pays back over 20-30 years. So building is also difficult.

Stocks are very volatile currently. Not only since Iran. To me it seems since the financial crisis 2008 investors don't enjoy stocks as before.

Gold: Only if you are paranoid about collapse of society. It doesn't make sense to invest into s.th. without interest rates.

Crypto: Same as gold, but better if you like gamling. I would assume most people who are very rich don't gamble with most of their fortune.

Looking around, and especially forward, it would be military tech, e.g. [1], and its supply chain, e.g. [2] :-\ Valuations are not as crazy, but I bet there'll going to be a lot of demand in the coming decade, unfortunately.

Chip production, too, of course, but it's overflowing with money already, apparently. It's growing though, because there are real actual shortages of stuff like RAM and SSDs, there's money to be made immediately if you can. Chinese RAM manufacturers are building out like crazy.

[1]: https://www.ultimamarkets.com/academy/anduril-stock-price-ho...

[2]: https://www.marketscreener.com/quote/stock/RHEINMETALL-AG-43...

> Stocks are very volatile currently. Not only since Iran. To me it seems since the financial crisis 2008 investors don't enjoy stocks as before.

These returns do not qualify as “enjoying stocks”?

https://investor.vanguard.com/investment-products/etfs/profi...

The returns are higher than before 2008, the previous 15 years are unprecedented.

https://www.macrotrends.net/2526/sp-500-historical-annual-re...

> To me it seems since the financial crisis 2008 investors don't enjoy stocks as before

Maybe in Europe. The US stock market has nearly tripled since then. Literally the best period of stock growth in history.

you gotta have some of all the above actually.

OpenAI is making $24b a year. It's a 32x revenue multiple. High, but not insane. Spinning this as a story of overinvestment doesn't make sense.

Are you conflicting price to earnings to price to revenue?

32x earnings is high. 32x revenue is probably insane.

That's the tao of hyper-financialization. It must keep growing irrational exuberance big and up forever like stonks or it bursts like DotCom and tulip mania. It's funny money that cannot be liquidated for real value for more than a tiny fraction of the imaginary trillions being thrown around. Similarly, Nvidia $4T mkt cap makes absolutely no sense when it has but a few incestuous customers-parters-investors throwing around tens of billions each per year devoid of fundamentals like essential service offerings that turn a profit. Those handful of whale customers will make their own chips or cease buying large qtys at any time.

I wonder what is not getting invested in bc AI has been crowding out everything else since 22.

It has to be brutal out there for everybody else, if all the money is going to AI.

And not even actual capital either, as much of the investment amounts into AI have been through cloud and GPU credits so that AWS or Microsoft Azure don't actually have to hand over billions in straight cash.

But they're really cagey about actually handing money over to them today

It's the result of too much echo chambered bullshit floating around daily about how capable LLMs really are. It's literally crypto/blockchain all over again. It's one big lie that a lot of people have bought into which causes it to self-perpetuate, like religion.

  > At least they're throwing consumers a bone via the ARK deal.

I had to look this up. There's a venture fund you can invest in with as little as $500 as a consumer -- though it's limited to quarterly withdrawals.

https://www.ark-funds.com/funds/arkvx

The fund is invested in most of the hot tech companies.

ARK was all the rage around early pandemic time when wallstreetbets was in the news a lot. Most people probably know it from then.

ARK funds has cult like following but then again they are a typical high beta player who outperforms in hot markets and heavily underperforms in cold ones. Fees are high. The CEO (CIO) is a women who looks for investment advice in the Bible and asks God for his thoughts (I am not joking).

If anything being associated with ARK in any form is a big negative signal.

An ARK ETF is a smell to me. Besides, based on their holdings, i would never invest. 18% of the fund is SpaceX

I would not call an effective 2.9% expense ratio "throwing a bone".

Also, the valuation for such a debt laden company should be viewed with great skepticism. I'm afraid a lot of mutual funds will end up holding the bags.

It's not that far off from the standard 2% mgmt fee and 20% of excess performance?

The money is worth much much less than it was before, we live in times of global hyper inflation.

> At least they're throwing consumers a bone via the ARK deal. It's crazy how little AI exposure is available to anyone who isn't already wealthy and/or connected.

It is deliberate. Period.

It's always been known that you make money in the private markets and pre-IPO companies and retail is the final exit for insiders and early investors.

Retail is not allowed to be early into these companies (Because that would ruin the point of being an insider) and this "exposure" has to be at the near top.

Who are "these" companies? Did retail get into Google, Facebook, Amazon, Tesla, etc before the top?

Also, aren't AI businesses losing a lot of money each year? Pretty sure there is some risk involved that is not good for retail.

There are ways now for retail to get in to these companies including, check out hiive or equityzen...just beware of massive dilution.

VCX (Fundrise) has way more exposure than ARKVX

It's also trading at a huge premium. Probably worth a read if you're considering it: https://www.morningstar.com/funds/fundrise-innovation-is-not...

Even a billion dollars is crazy money. If you have a company with a subscription service that costs $100 yearly, you have ~2m customers, with a 50% profit margin. Your company makes ~100m every year in profit. Imo that's what is actually worth a billion dollars, maybe even a bit less.

That company is probably worth about $8b, FYI. Obviously that's an estimated average but a P/E ratio of 80 give you that valuation.

I lost track when business analysts stopped analysing CEO-level commitments and outputs and performance. right now, it seems that whatever promise is taken as certain and company puffery (using the language invented by themselves) is taken lightly to tricky investor in throwing money.

the whole thing did not yet crash because it seems they can still promise even more without actually delivering definite results

I can't help but think building an "everything" app is so.. both unbelievably ambitious, and a folly. I am not personally convinced that people want all the things that this super app purports to do.

I am from a generation that still sits behind a desktop computer when making "big purchases." I can't even buy a flight on my phone. I am so much less likely to want to have an AI agent do that for me.

Then the idea that daily consumption of these products will drive people to use them more at work... I have a very different life outside of work. My use of AI outside of work is exceedingly different to what I use it for at work.

I sometimes feel wildly out of touch. But sometimes I view this as the VR moment. To me there are some things that I think may always be preferable to do outside of that ecosystem. And for me, a lot of tasks that 'agents' enable are small enough or important enough that I want to do them myself.

I don't think I'll ever be comfortable allowing an agent to call me a taxi, or order food on my behalf. Because the convenience of asking for food isn't worth the chance it'll mess up, and opening an app and looking at a menu is simpler.

I also think we're coming to a moment where we can start identifying the markers of AI generated content on sight. And I think there's a growing animosity to it. I might be comfortable asking AI something, but when I am looking for or searching for other content, seeing AI content markers make me angry at this point.

To finish, I do just sort of straight up hate the idea that we're comparing this moment to the invention of electricity. It's on the face of it absurd.

I've worked for 3 different startups where the CEO at one point gave us the talk of "we're building a super app".

Admittedly openAI is in a better position to do it, but not by much.

Everyone wants to be WeChat in china. No user wants that from them.

WeChat is not a super app. It's a browser. Tencent WeChat is the equivalent of Google Chrome.

Is it a browser or like a browser? I've never actually used it but from what I understand WeChat's mini programs are like web apps but not something you can open up in a typical browser.

Alternatively, you could say browsers are the original super app.

cries in Musk

>> To finish, I do just sort of straight up hate the idea that we're comparing this moment to the invention of electricity. It's on the face of it absurd.

Do you feel that any technology is comparable in it’s impact?

Most of modern medicine, by which I mean each discovery and invention in their own right, stand alongside electricity. Particularly vaccines.

AI isn’t there yet. You could turn off AI tomorrow and there’d be a shock but people would quickly switch back. You could not do the same for electricity, medicine, combustion engines (or steam engines/turbines), computers, the internet, modern building materials, etc. You try to swap back off any of those and the modern world (literally and figuratively) collapses. Turn off AI, and there’d be a financial collapse but afterwards everything would return relatively easily to an earlier way of doing things (ye know, the way from just 4 years ago, and which is still 99% of how people do things :) )

I think the Internet is the more apt analogy. But even with electricity, you could have taken it away within the first couple decades of its popularity and society would have shrugged it off. Once they got used to that telegraph thing, not so much.

Sure, but compare this to "turn[ing] off" combustion engines a mere four years after commercial adoption rather than 162 years later (now). Back then, going back to horses wouldn't have been as big of a deal as it would be now.

That's primarily a function of the time for adoption, though, not the utility of the technology. In 20 years, people would not be able to so easily say that they could turn off AI with no impact.

> I don't think I'll ever be comfortable allowing an agent to call me a taxi, or order food on my behalf.

I don't let another human do that! When we as a group order lunch, I always want to input mine directly or at least double check the order.

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 this is clearly the future - AI has access to all the data sources and can translate your intent by accessing these tools in a loop and use intelligence to automate things.

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 at 5am is worth the savings.

I'd have not typed that into a prompt. I made that decision at the moment I saw the possibility. I didn't even know that it was an option prior to that moment.

Then I go look at hotels. I have a list of requirements, but I see that one of the hotels that I just glanced at has a really nice long pool, and the amenities look nicer from the images. I change my mind at that exact moment, I can walk 15 minutes more to the beach.

Now it should be even clearer why this is important for food.

Think of personal assistants that rich people have. They learn your habits and take care of business, like making your travel plans. The promise is to give you that for much less.

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.

You had me going until you said this is even clearer why it is important for food. Food is cheaper and has less impact on your life. I'm much more tolerant of a mistake or suboptimal experience with food.

No mention of "AGI" this time. Since we all knew it was a scam. But this is the most damning of them all:

> The OpenAI flywheel is simple. More compute drives more intelligent models. More intelligent models drive better products. Better products drive faster adoption, more revenue and more cashflow.

FTX had a "flywheel". It fell off. Being saddled with hundreds of billions of debt makes this situation ten times worse.

Looking forward to the movie about this absolute scammer Sam Altman when this is all said and done.

I get the appetite for frontier models. But why not just invest in Google. Do they really expect the return profile of OpenAI to be vastly different than Google’s Gemini?

I imagine they get a bigger slice of the pie with OpenAI than they do with Google, an extremely mature company who’s had investors buying in for 30 years.

Alphabet’s market cap is $3.5 trillion, compared to OpenAI’s $850 billion reported here.

it's not really investing though. Amazon will provide 50B worth of compute and Nvidia will provide 30B worth of chips etc. Google doesnt need any of those.

The only one that is really investing is SoftBank who is pushing for a faster IPO so they hope to make a profit on that and again Google does not offer that opportunity

Google has little need for more money, so the price will be much higher. OpenAI being a separate entity also means Google's competitors (Microsoft, Amazon) can invest there without looking silly.

I hate to read this line when academics and graduate students who work in basic and hard sciences have their funding cut. The grand funding that pays minimum wage to grad students is a burden for this society, yet for a company that took all the valuable data from sources that never got credit, raises billions of dollars. Open says the name, but closed it is by operation. Sorry for this rant, but the priorities of this world suck.

We’re all feeling it. Unfortunately our country is run by a dude with dementia and a carnival of Fox News hosts.

But I suspect that’ll u-turn hard when the economy implodes

Or all of the people that they didn’t ask, let alone compensate, that made all of the stuff they munged up for training data, so they could sell cheap knockoffs in the same markets.

With $122B what are you going to build next? Spaceships?

Rather than advancing the state of the art, they'll use it to slow down competition by starving them of resources. In the style of a monopoly.

All the high performance RAM, frontier node wafer capacity, flash and disk drives on Earth. Also, all the gas turbines.

Universal paperclips. And here I am asking ChatGPT which type of onion to use dor coq au vin.

If they buy all the jet engines too (to turn them into gas turbines) they can be carbon neutral. More gas burned, but less jet fuel. It's a win-win.

Google makes money like that in their sleep from mostly just advertising.

OpenAI charges about 20$/month to tens of millions of users right now. 240/year. About 12 billion per year. That's a market that could grown to billions of people with a long tail probably not paying a lot but being served ads; and a fat high end paying a lot more than that for an ad free/premium experience. They should be able to reach billions of users.

It's why Google is matching investments in AI like this entirely from the profit from ads.

Going to space isn't that expensive. SpaceX bootstrapped with a lot less than that.

Nah, you'll get a few days worth of inference.

Ugh, does this mean I should say goodbye to what little RAM and other hardware remains available on the consumer market?

This all smells fishy. They didn’t “raise” $122B. Raise means someone put funds in your bank account and said send us the next quarterly report to tell us how our investment is doing.

They have pieces from paper of folks saying they may put up funds or goods and services in that amount. But it’s important to remember that:

1. While they are “raising” commitments others are backing out of deals (see Disney, various data center things). Big deals announced to major fanfare are falling through.

2. They slashed capital expenditure for the future after previously boasting about all the commitments. This is turning into bonkers math of X + Y - X + Z + W - 1/2 of Y = ? On trying to keep track of what’s actually “raised / real” vs what was PR puffery that folks ran away from later.

3. Circular financing still seems to be going on. Big difference of here’s cash, have fun and various “commitments” and balance sheet games that seem to still be going on.

Net net this all still looks very scary and iffy at best.

If OpenAI goes down their investors will lose any chance at getting their money back. They need to keep pretending things are going great for as long as possible.

Are we truly arguing semantics on HN which is a news aggregator for startups and everyone truly knows what a "raise" is and it is obviously not funds in your bank account? I don't disagree with the rest of your comment and the core thesis is valid that OpenAI is very much doing circular financing.

Edit: A raise comes with stipulations on what you can use the money for. I don't know if I was being too mean about responding to a parent but before you comment just google what a raise has..

Other than funds in a bank account I do not know what it would mean.

So when my coworker tells me he got a "raise", they're not talking about money that will end up in their bank account?

Right because, what does even "buy" mean?

https://thedeepdive.ca/openai-locked-up-40-of-global-ram-wit...

Are there any Polymarket / Kalshi bets on the over-under for the price? I wonder when the music will stop.

https://polymarket.com/event/openai-ipo-closing-market-cap-a...

I don't gamble but if I did, I'd bet a lot on $1.6t.

Almost a trillion for a company that hasn’t proved it can reach any form of profitability, all on the promise of an elusive messianic concept of machine superintelligence through probabilistic algorithms. Basically like praying cancer away. Peak magical thinking, peak America.

The only thing that's really accelerating is how fast you get rate-limited on ChatGPT.

The big AI firms are all heavily compute-constrained, so that shouldn't be much of a surprise.

They are trying very hard to convince themselves that it's going to work, when we see all the models plateauing... it's clearly hitting the ceiling

I don't know anyway using these models everyday who think they are hitting a ceiling.

If anything there's a plateau between each model release.

I'm seeing diminishing returns, though in fairness we have no idea yet how to integrate properly with existing good practices and principles. I suspect improvement is going to come mainly from improved took usage rather than more impressive models.

I feel that too, every technology has its limits. I use AI daily. But I can’t see the “intelligence“. All I see is fine tuning and bigger datasets.

Yesterday I asked claude to fix the color issues of graph. It failed miserably. Opus 4.6 wasn’t able to figure out why the text was grey. It made something up, instead of realizing the problem was simple, oklch wrapped inside a hsl color. hsl(oklch(…)) I easily figured this out by just looking at the css and adding some logs to js.

This is not intelligence. This is a tool that’s smart. Not sentient. AGI won’t be achieved by scaling alone.

Intuitively, it just doesn’t feel like OpenAI has a trillion dollar moat.

Alphabet is worth $3.5 Trillion. What’s their moat?

Much more than Google search. Cloud, Waymo, Verily, Deepmind, stake in Claude. So many bets other than just ads.

I still don't get how a non profit can become a for profit entity on a whim.

Google is totally going to run this company out of money aren't they?

Amazing. Reporting two mercurial numbers as if they were cornerstones.

Microsoft will buy OpenAI for $500B, rebrand it as Microsoft AI.

This is where they are headed. But the real price will be a lot less.

With what, Azure credits?

This leak and looking into source code gave me an impulse to try OpenCode with codex models. I am very impressed with how well it works, and the UI is beautiful.

feels like an insult to readers to try to pretend that their revenue per month is comparable to google or apples growth when the funding is absurdly different, not to mention inflation itself.

I am very much onboard with AI within my workflow. I just don't really see a future where openai/anthropic are the absolute front runners for devs though. Maybe OpenAI does just have the better vision by targeting the general public instead, and just competing to become the next google before google can just stay google?

What is their next step to ensure local models never overtake them? If i could use opus 4.6 as a local model isntead and wrap it in someone else's cli tool, i 100% do it today. are the future model's gonna be so far beyond in capability that this sounds foolish? the top models are more than enough to keep up with my own features before i can think of more... so how do they stretch further than that?

A side note i keep thinking about, how impossible is a world where open source base models are collectively trained similar to a proof of work style pool, and then smaller companies simply spin off their own finishing touches or whatever based on that base model? am i thinking of thinks too simplistically? is this not a possibility?

Anthropic is definitely gaining ground over OpenAI in the business world. Cowork is the absolute hotness right now, and even prompted MSFT to drop their own variant yesterday

Ask anybody you know that works in Big Tech. They're all pushing hard for Claude Code adoption.

Codex and Gemini CLI seem 1-2 months behind Claude Code. They will catch up. This race will eventually be won by whoever can come up with the cheapest compute.

> how impossible is a world where open source base models are collectively trained similar to a proof of work style pool

Current multi-GPU training setups assume much higher bandwidth (and lower latency) between the GPUs than you can get with an internet connection. Even cross-datacenter training isn't really practical.

LLM training isn't embarrassingly parallel, not like crypto mining is for example. It's not like you can just add more nodes to the mix and magically get speedups. You can get a lot out of parallelism, certainly, but it's not as straightforward and requires work to fully utilize.

It's hard to train models in the open. All the big players are using lots of "dodgy" training data. Like books, video, code, destinations. If you did that in the open, the lawyers would shut you down.

Though I think these companies are wildly overvalued, I don't see LLMs as a service going away in the future. The value in OpenAI is that it provides extra compute, data access, etc. My money is on local AI becoming more of a thing, while services like OpenAI still exist for local AIs to consult with. If a local model can somehow know that it's out of it's depth on a question/prompt, it can ask an OpenAI model if it's available, but otherwise still work locally if OpenAI fails to respond or goes out of business. To me that makes a lot more sense than the future being either-or.

Models not being able to reliably know if they are out of their depth is a foundational limitation of the currently generation of models, though.

Best they can do is to somewhat reliably react to objective signals that they've failed at something (like test failures).

> What is their next step to ensure local models never overtake them?

As someone who experiments with local models a lot, I don’t see this as a threat. Running LLMs on big server hardware will always be faster and higher quality than what we can fit on our laptops.

Even in the future when there are open weight models that I can run on my laptop that match today’s Opus, I would still be using a hosted variant for most work because it will be faster, higher quality, and not make my laptop or GPU turn into a furnace every time I run a query.

If your laptop overheats when you push your GPU, you can buy purpose-built "gaming" laptops that are at least nominally intended to sustain those workloads with much better cooling. Of course, running your inference on a homelab platform deployed for that purpose, without the thermal constraints of a laptop, is also possible.

You can host a website on any rackmount server for pennies compared to AWS. But people still use AWS.

The market for local models is always gonna be a small niche, primarily for the paranoid.

"The market for local models is always gonna be a small niche, primarily for the paranoid."

Have you ever heard of industrial espionage? Pr privacy regulations? Or military applications?

(Also the US military runs claude as a local model)

The goal of web hosting is to provide low latency wide availability to many users.

AI in this context has a very different goal as a tool for individual users.

You wouldn't say that hosting instances of Photoshop on servers and charging for usage is a long term viable business would you? Even if current consumer computers struggled to run Photoshop.

>"But people still use AWS"

I do not, I self host. My current client is also got rid from AWS packing up nice savings as a result

Does anyone know if this, like the spacex/xAI stock — will list on nasdaq? And will it be part of every market cap weighted index fund like VOO(S&P) etc or just for nasdax-100 etfs?

The exchanges are bending head over heels to accommodate these IPOs[1] and make our retirement index funds the exit-liquidity strategy to the thievery of pump and dump actors that buy it low and then sell high? As i understand the way thievery works is:

1. List at many multiples of market valuation on an exchange. So if you company is just 10 billion$ nasdaq and theives collude and say "can make it 100 billion..".

2. Lots of institutional investors and rich billionaires get stock options.

3. All market weighted index funds — aka all *your* low expense ratio ETF money — have to re-balance and buy them, raising their value: the exit-liquidity event

4. Rich A**** get richer by making an profit by selling higher.

[1] https://www.economist.com/leaders/2026/03/31/index-providers...

It does seem likely. Iirc SpaceX wants to waive the year long holding period before their stock enters the indexes.

Which to me seems like a very naked attempt at getting 401k to bag hold

They are pushing hard to be part of the nasdaq 100. You can shift your retirement funds from the nasdaq to the Dow or s&p

This is so bad. OpenAI has already singlehandedly destroyed the global flash memory market with their war chest, this will just give them more power.

Fortunately, OpenAI's naming didn't cause a wave of greedy and predatory new companies, like OpenHealth, OpenEnergy, OpenCompute. The non-sexy name of their product using the originating algorithm (GPT) is punishing them. It could be anything else more attractive that would bring more customers. Because, for me, a good, inspiratory, engaging name is half the success.

https://www.opencompute.org

the only lesson the common man should take from these valuations: start to protest against AI conpanies being included in the sp500!

unless you're a private investors in these preIPO, the whole plan is to get big enough, get forced entry into indexes, and leave early with everyone else holding the bag.

I do not understand how these companies can have such high valuations when minimax m2.7 is going to be open weight.

Pardon my ignorance, but how can a company that spends almost $2 for every $1 it brings in be worth anything?

What if all the people currently using these "AI" services are the entire market for those services? I'm pretty sure everyone that wants to use LLMs is already doing so and already paying for the service.

That would mean the only way to increase growth would be to charge more per token and to get the existing people to use more tokens. Both of which seem to be only what mature companies do when trying to squeeze the cash cow for all it's worth.

It also explains why they're trying to stuff AI into everything, to keep the numbers up, and to get everyone to try and pay them money.

When I show people personal projects I’ve vibe-coded with Claude Code, they often seem impressed and envious. They come up with ideas for things that they would like to do, too. But they have full-time jobs outside of IT, and when I mention they might need to use the terminal to do what I’m doing now their eyes glaze over.

A couple of such people, after they learned about Claude Cowork, signed up for Anthropic subscriptions and are now using it in their jobs. But overall my impression is that there is still huge potential demand from regular people who use computers for agentic systems with less barrier to entry, and that many will be willing to pay for such systems when more mature and user-friendly ones arrive.

Most of humanity hasn't figured out they need to adapt yet. It's a bit like email and the internet in the mid nineties. People had heard about it but hadn't really embraced it yet. Five years later most people with white collar jobs had email addresses. Fifteen years later, billions of internet capable smartphones were in circulation.

The AI revolution is following a similar adoption curve. Right now many of the tools are only really usable if you are a developer or at least not too shy making AI agents use developer tools on your behalf. That's not going to stay like that for very long. It's going to be a messy transition that will likely take much longer than some people seem to think. But eventually most people doing knowledge work will be leaning heavily on all sorts of AI agents to do their thing. And quite a few will have to learn new skills as most of the stuff they still do manually today just goes away as a thing that you do manually.

Like the mid nineties, these are amazing times for people with a slight head start over everybody else. Which is why there is such an investment frenzy around AI right now. Lots of possibilities where lots of money might be made. And lots of things that won't work out. And lots of people really not seeing the forest for the trees as well. And generally behaving like headless chickens. But the internet in the end proved to be not a fad and it didn't all go back to normal after the hype died and the .com bubble burst.

IMHO, the bubble around AI is not so much the technology but things like data center and energy pricing. The cost of data center production is long term a fraction of current cost (dominated by GPUs costing tens of thousands of dollars). Likewise cheap and plentiful energy to power them is going to eventually cost a lot less. Short term scarcity eats up a lot of billions right now. But you'd be mistaken to confuse that for long term structural cost. Cost is going to come down and that will drive adoption. And that's before you consider edge compute on commodity phones and laptops. There will be billions of devices running small AI agents. Add robotics to the mix and it's a whole new world.

In short, companies like OpenAI and Anthropic are valued so high because all of that is happening right now. Yes, it's a bit of a bubble. But stuff will definitely happen.

On the other hand, the productivity gains from AI automation are so large that you are forced to use it to compete in the workplace, even if you strongly dislike the terminal, you will dislike homelessness more.

Think about all the "people" AI services can displace in due time. There's a fuckload of pencil pushers / knowledge workers with 100k student loans whose lifetime contribution can probably be measured in a few hundred dollars in tokens. And TBH normalizing AI crutch for kids is going to make large % of future cohorts even more replaceable. Skill atrophy among youth is declining hard, but AI is basically crippling future workforce quality to make their displacement even easier. There's even less reason to hire entry level in 4 years not just because models get better but human capita is going to be so much worse.

The market hasn’t been built out yet. There’s that post from a couple days ago where someone frontloaded the entire UX of an operating system onto an LLM, so you just tell the hardware what you want to do and it does it. https://news.ycombinator.com/item?id=47557165

The growth is there but it’s going to be a marathon, not a sprint. I don’t know why everyone’s in such a goddamn hurry all the time

Give it a year or two, and apple or any other hardware will have unified memory OR AMD will have a good offering to run all that stuff locally. It won't be as good as Claude, but it'll do for 90% of the things. It will be expensive as first, just like the first mainframes, then give it another 5 years or so, and it'll be affordable.

I'd argue this has already happened. The highest end mac pro is $10k and down from there. We might be returning to the appliance business model.

Its just a matter of Productizing the software to plug and play light office admin work.

I think there is a massive market in waiting for something that uses a way better UI/UX. I’d say chat is only great for developers/technical people.

> only way to increase growth would be to charge more per token

Or spend less per token (ie. increase profit margin without raising prices).

Would be nice to have this seperated from, i-owe-you, vs actual funding that's liquid!

God help us if all of our retirement index funds are forced to buy this bankruptcy bomb.

I thought they needed $7 trillion or they'd be unable to keep training new models?

Wow. I doubt Anthropic can raise that. Are they more efficient, can they do with less?

Given how all of Big Tech (except Google obviously) is going all in on Claude Code, I wouldn't be surprised if Anthropic becomes profitable first.

Anthropic doesn't have anything else other than the Claude models.

But notice that no-one, not a single mention of Deepseek tells me that they are preparing to scare everyone again. Which is why Dario continues to scare-monger on local models.

Sometimes you do not need hundreds of billions of dollars for inference when it can be done locally with efficient software; and Google proved that. But where is the money in that? So continues the flawed belief in infinitely buying GPUs to scale which Nvidia needs you to do.

Only a matter of time for local models to reach Opus level. We are 1 or at most 2 years behind that and Anthropic knows that.

> Only a matter of time for local models to reach Opus level. We are 1 or at most 2 years behind that and Anthropic knows that.

Can confirm. Kimi K2.5 is pretty intelligent and most of the time there's no difference between Opus and Kimi.

Local models just make no economic sense since the GPU will idle 99% of the time.

Each passing day the lie that markets efficiently allocate capital is further exposed

Standby for tiered information.

Have a question on health symptoms? You must subscribe to openAI health

Have a question on math? You must subscribe to openAI math

The only way they can manage this type of monetization is a lot of compute to process outputs.

isn't it weird that there is no attribution to a human here? i mean, eventually, they have to dropkick sama and install GPT itself as king, right? EOQ seems as good a time as any

I can understand why Amazon, MS and Nvidia invested - nefarious circular deals, but Softbank? I mean who the heck is giving Masayoshi Son money to invest? Behooves me!

Are we going to see a trillion dollar IPO?

There is a lot of talk about the AI bubble. I think there are comparisons to the late 90's/early 00's here with early stars rising quickly but, ultimately, falling. Since essentially everything touches the internet now it is clear that the 'internet bubble' was more of a shakeup of companies than a real over-hype of the internet. That, I think, is at play right now too with the 'AI bubble'. AI isn't going away but some of the early stars may not make it.

So, the real question here is: Is OpenAI Netscape, or are they Google?

What is their moat?

It seems like its just consumer name recognition at the moment

I don’t care if OpenAI is Netscape or Google.

What I want to know is are we in 1994 of the AI bubble or 1999?

Because even after the dotcom bubble popped, it was still much better than it was in 1994.

I think the cycle is way faster than it used to be so even if we are in 1994, the pop is probably pretty close.

"Not yet profitable" doing a lot of heavy lifting here for an 852B valuation

Nah this raise (commitment) is... blah.

Last announcement I reckon pre-IPO and the inevitable collapse.

With $122 billion at your disposal, what do you plan to build next—spaceships?

Feels like the number is more about FOMO than fundamentals at this point.

the hype machine knows no bounds. it should be illegal to publish such farcical claims when they are intended to manipulate markets...

Thsi is the most blatant pump & dump scam I've ever seen. It's going to crash like a meteor.

People won't be able to afford to leave their beds because food prices will be too high to justify the energy cost of standing up.

Every joule of human energy is energy that could have been better spent to produce AI slop for other AI agents to consume.

well we do need at least two powerful AI companies, so they can cross checkout each other when I use them.

They have to focus on the distant future (where they are frankly unlikely to exist) because they are falling further and further behind in the immediate future.

Their latest desperate bid for relevance is a plugin for Claude Code that uses Codex as a second opinion. Please clap.

This a big exaggeration. Codex is probably one of the top two LLM programming tools, along with Claude Code. GPT-5.4 models are strong, unlike the initial GPT-5 ones, which were comparatively bad, and can hold up against Opus 4.6. In my experience, they are better at analytical work.

I cannot really see how they are "far behind," or how some plugin for Claude Code is a "last desperate bid." The tools are close enough to each other that I regularly use Codex one month and Claude Code the next without much disruption, just to try out any new models or features that might be available.

I do not have much visibility into the non-code applications, so maybe it is stickier there.

If/when the AI bubble pops and takes OpenAI down with it, I would not expect Anthropic to come out unscathed either.

They were years ahead. They managed to generate competitors (Anthropic is OpenAI refugees) by alienating their own employees by being so dishonest and immoral when compared to their own founding principals and even legal documents. They experienced a coup where the primary technical vision of the company was forced out in favor of someone who is comparatively a nontechnical dummy. That was the beginning of the multiple years of stagnation while they burned tens and hundreds of billions of dollars while their competitors caught up and then passed them by.

OpenAI is floundering and can't sustain their own burn rate. Their competitors are thriving. This is a market and technology that OpenAI largely created and just a few years in they are behind, losing unprecedented amounts of money, and have no clear path to catch up.

Lets be totally clear, they were 3 years ahead 3 years ago and now they are behind. They are literally standing still.

does Softbank run of out money i.e announce these deals but never follow up ?

This is going to be bad

What will happen first? The Singularity arrives, and hyper-intelligent AI causes such rapid technological change that the world becomes unrecognizable overnight?

Or OpenAI pays off it's investors? Lol.

I am not sure if I believe in the Singularity or not. But it's kind of the best story ever to support the game of musical chairs that is Silicon Valley investing.

"Commited capital" - is this the same commited as the $500B for the Stargate project ?

Not gonna lie, I hate those announcements lately. It's full bullshit mode, worse than the Dot-com bubble. Numbers don't make any sense, any more, and yet journalist don't ask any real questions...

[flagged]

Please don't post generated text to HN. We ban accounts that keep doing this.

https://news.ycombinator.com/newsguidelines.html#generated

https://news.ycombinator.com/item?id=47340079

Don't know why so many down votes for something that's clearly just another opinion

Probably because it reads a little like an LLM and also has an emdash

thats a really large number

You do know that not all of these AI companies can become be trillion dollar companies, right? Easy come, easy go has no limit.

Inflation is a hell of a drug.

Money has lost all meaning in tech. 122 Billion raise! This is some kind of dream.

didn't they just raise last month?

I think that runway has run out /s

Good luck competing with Google which has "unlimited" budget.

"Despite unprecedented capital investment in our R&D, our core product isn't getting meaningfully better so now we're building an app."

Doesn't really strike me as the kind of statement that comes out of a company that can sustain a ~$1T market cap...

> The OpenAI flywheel is simple. More compute drives more intelligent models. More intelligent models drive better products. Better products drive faster adoption, more revenue and more cashflow. That gives us the ability to reinvest and deliver intelligence more efficiently to consumers, enterprises, and builders around the world.

-x-

In short, the musical chairs are still playing... Keep on walkin' round, y'all, till the music stops.

Fortunately, I was afraid that this was another bubble. /s

I wonder what the bet is here, long term that valuation is going to have to go up even further for this investment to make sense so they're clearly betting that at IPO time they'll be able to convincingly demonstrate AGI or something extremely close to it. That's a pretty risky bet, and meanwhile, whatever they come up with will be a commodity within a year. And that's besides OpenAI no longer being seen as the dominant player or the player with the best edge.

"This is not just product simplification. It is a distribution and deployment strategy."

I am so sick of AI writing.

The snowclone is annoying, but comparisons are sometimes necessary. The problem here is the actual content is sloppy.

corporate speech existed long before AI

Mmm, it’s almost like OpenAI built statistical models using pre-existing corporate speech as the target data... ;)

Get used to it. All PR statements nowadays get AI treatment before going public.

> We are now generating $2B in revenue per month

What??

They got a very sweet deal from the Pentagon, it seems.

Word on the street is that Anthropic is roughly at half that. Hard to know what they include and not, and what their real, non-subsidized costs are.

What what? Are you surprised it's that low, that high, that they can tell what their revenue is, that they report it on a monthly rather than annual basis, or something totally different?

It's going to be pretty hard to get a good answer to whatever you're having difficulties understanding if you can't be bothered to write more than a word.

> 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/

Correction: no one can afford to acquire them.

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