alt Hacker NewsFrom what I've read, every major AI player is losing a (lot) of money on running LLMs, even just with inference. It's hard to say for sure because they don't publish the financials (or if they do, it tends to be obfuscated), but if the screws start being turned on investment dollars they not only have to increase the price of their current offerings (2x cost wouldn't shock me), but some of them also need a (massive) influx of capital to handle things like datacenter build obligations (10s of billions of dollars). So I don't think it's crazy to think that prices might go up quite a bit. We've already seen waves of it, like last summer when Cursor suddenly became a lot more expensive (or less functional, depending on your perspective)
Replies
Dario Amodei has said that their models actually have a good return, even when accounting for training costs [0]. They lose money because of R&D, training the next bigger models, and I assume also investment in other areas like data centers.
Sam Altman has made similar statements, and Chinese companies also often serve their models very cheaply. All of this makes me believe them when they say they are profitable on API usage. Usage on the plans is a bit more unknown.
This is my understanding as well. If GPT made money the companies that run them would be publicly traded?
Furthermore, companies which are publicly traded show that overall the products are not economical. Meta and MSFT are great examples of this, though they have recently seen opposite sides of investors appraising their results. Notably, OpenAI and MSFT are more closely linked than any other Mag7 companies with an AI startup.
https://www.forbes.com/sites/phoebeliu/2025/11/10/openai-spe...
Sam Altman is on record saying that OpenAI is profitable on inference. He might be lying, but it seems an unlikely thing to lie about.
> From what I've read, every major AI player is losing a (lot) of money on running LLMs, even just with inference.
> It's hard to say for sure because they don't publish the financials (or if they do, it tends to be obfuscated)
Yeah, exactly. So how the hell the bloggers you read know AI players are losing money? Are they whistleblowers? Or they're pulling numbers out of their asses? Your choice.