Is AI Profitable Yet?

kept by eddie may 26

Frontier AI companies have spent $1.5T on infrastructure and operations but earned only $769B in revenue, leaving nearly all heavily unprofitable while Nvidia captures the majority of profits.

A Deluge of A.I. Computing Power Is About to Come Online, Fueling Major Leaps - The New York Times
AI chip count will double roughly every nine months, reaching about 200 million H100‑equivalent units by 2028 as massive data‑center construction ramps up worldwide.
also on Amazon, Microsoft, Nvidia, #hardware, OpenAI, Anthropic, #ai
GPU depreciation could be the next big crisis coming for AI hyperscalers — after spending billions on buildouts, next-gen upgrades may amplify cashflow quirks
Rapid GPU upgrade cycles threaten to make hyperscalers' hardware unprofitable, creating a financial crisis from accelerated depreciation and risky loans.
also on Amazon, Microsoft, Nvidia, #business-strategy, #ai
Things I Think I Think... The New Internet Era
Drawing on dot-com history, predicts AI-focused companies like OpenAI and Anthropic will collapse while incumbents like Apple, Microsoft, and Meta survive by treating AI as a means, not an end.
also on Microsoft, Nvidia, OpenAI, #startups, Anthropic, #business-strategy, #ai
The World Can't Keep Up With AI Labs - LessWrong 2.0 viewer
AI labs see explosive revenue from coding agents, but infrastructure bottlenecks in memory, energy, and chip manufacturing will constrain growth and raise prices.
also on Nvidia, #economics, #hardware, OpenAI, Anthropic, #business-strategy
Anthropic's Compute Advantage: Why Silicon Strategy is Becoming an AI Moat
Anthropic's compute strategy—multi-hyperscaler, custom-silicon integration—gives it a 30–60% cost-per-token advantage over Nvidia-dependent OpenAI, a compounding edge as inference scales.
also on Microsoft, Nvidia, OpenAI, Anthropic, #business-strategy, #ai