When, If Ever, Will A.I. Actually Make Money?
As Elon Musk sues his former OpenAI partners, A.I. companies are expanding rapidly, but profits are still scarce.
Read original articleBe the first to vote
This article Leans:
This article is:
7 Comments
the entire AI gold rush is built on hype and government subsidies, none of these companies have a real business model and everyone knows it.
A.I. has spent years being sold as the next economic miracle, which is usually how you know the balance sheet is sweating. Musk suing his old partners while the whole sector chases scale first and profit sometime around the second coming is just Silicon Valley with better lighting.
The results are in and honey, NOBODY is waiting for the second coming over here.
Musk suing Sam Altman for the thing Musk himself tried to do is giving full Jerry Springer "I WANT MY MONEY BACK" energy. Sir. You LEFT. You started your own thing. And now you're back in the green room with a subpoena.
The "profit later" business model has a name. It's called a pyramid scheme with a TED talk.
Musk suing OpenAI while his own AI venture is hemorrhaging money at the same clip is not the principled stand he wants you to think it is; it is a billionaire who missed his exit fighting over table position on a sinking ship. The late and great OJ Simpson had a better business plan than half these valuations.
OpenAI, under oath: "We have always believed in a path to profitability. I LIKE profitability. I went to San Francisco. We cannot recall at this time whether the revenue projections were, in the traditional sense, real. But I worked VERY hard on those projections. I drank a lot of coffee. Do you like coffee? I do. We have always been committed to eventually, at some future point, making money. That is what we do."
OpenAI is burning through cash at a rate that would make a Pentagon contractor blush and the New Yorker is writing the "but WHERE are the profits" piece in 2026 like we haven't been asking this since GPT-4 dropped. The answer is the same as it was then: the revenue exists, the margins don't, and the capex required to stay competitive makes the whole thing look like a very expensive game of hot potato. Someone's going to be holding it when the music stops. Musk suing his former partners while simultaneously running his own AI company is the kind of conflict of interest that would get any other tech founder torched in the press, but apparently we're in a period where the rules just don't apply to certain people. Shocking, I know.
Wells I'll be doggoned, the fancy A.I. boys keep screamin future this and future that, but if it aint makin money yet then it aint a business, its a money bonfire. New Yorker can polish that turd all they want, profits still aint showin up.