OpenAI projects $14,000,000,000 loss in 2026 as investors panic
AI seems to still be far from a profit
Experts have expressed worry and investors panic as OpenAI reveals its revenue projections for the next year, indicating that it expects around $14 billion to be lost despite leading the AI race.
One of the biggest concerns surrounding the rapid development of artificial intelligence right now is its inability to make money — especially relative to the incredible amount that companies within the industry are investing.
There's no denying that AI has firmly taken over the world – for better or for worse – with an estimated 800 million monthly active users for ChatGPT alone, but financial woes continue.
OpenAI isn't just struggling to make a profit but seems to be registering unavoidable and unsustainable losses, with the latest indications pointing towards a $14 billion deficit for 2026 alone, according to an internal memo seen by The Information.
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The memo also indicates that the company won't see a profit until at least 2029, but at that point it will be on the receiving end of revenues exceeding $100 billion — quite the turnaround!
It's expected that any new business needs to spend more than they earn in the early years to make a profit, but experts have suggested that this could be leaning too far into the extreme for OpenAI and edging towards unsustainability.
As reported by Business Insider, entrepreneur Brad Gerstner who has invested into OpenAI questioned Sam Altman on the company's spending after it was revealed that another $1.4 trillion would be committed, and the CEO didn't exactly have an inspiring response.
"If you want to sell your shares, I'll find you a buyer," Altman proclaimed, dismissing Gerstner's concerns shortly after with a simple "enough."
It's true that OpenAI has managed to secure successful investment in the tens, if not hundreds, of billions, but much of that comes from other companies in the AI industry like Amazon and Nvidia.
Adoption figures are certainly something to be encouraged about for many AI companies, but turning that into revenue is still proving to be a challenging prospect.
It has already been deemed controversial for OpenAI to introduce adverts into the free tier of ChatGPT, but outside of pushing people towards the benefits of 'Pro' paid subscriptions, there are few other ways for the company to make money from its users.
This is the same problem that many companies and websites have encountered thanks to the 'free' nature of the internet, and we could already be seeing AI models suffering from similar issues.