Anthropic raises money from IPO -> How long will that sustain them given the immense cash burn? Forget about gross profit - that's the number they want you to focus on and can be played with. Keep the focus on the cashflows -> if a firm runs out of money its over, who cares what your revenues and gross margins are. We are not talking Amazon level loss's which were paltry AND they were able to raise more than enough to keep going for awhile.
Management of firms who pay rent to LLM models need to reign in costs -> they will use a bundle of chinese +american models (this is already happening look at the data) -> affecting revenues, earnings and cash flows of frontier labs. Given the losses in absolute terms, any stunting of the growth rate would be catastrophic for the story re. valuation.
The frontier model story rests on one giant assumption: lay-offs must happen en masse at some point. It's not happening and in my view won't happen - there simply isn't enough trust. Moreover, do you think firms are going to trust these model providers, given its in their interest to steal IP? lol
Not rocket science mate.