The sad report has emerged: OpenAI may go bankrupt after 12 months!

A report from The Information says OpenAI could end 2024 with a loss of $5 billion. Analysts state that if it continues at this rate, the company may remain illiquid and on the verge of bankruptcy in the next 12 months. However, such a scenario seems unlikely as it is highly likely that OpenAI will need another significant round of funding to stay afloat.

OpenAI 2024 report: $5 billion loss expected

The report explains that OpenAI will spend $7 billion on training AI models and $1.5 billion on staff by the end of the year. To keep ChatGPT “alive” we currently daily expenditure 700 thousand dollars. This means a total expenditure of $ 4 billion, despite the discounted tariffs offered by Microsoft to use Azure services, and this is the largest cost item.

OpenAI’s artificial intelligence development process is so fast and energy-consuming that it cannot even keep up with its own pace economically. The expenses incurred to enable the evolution of ChatGPT greatly exceed the revenues generated from the chatbot. However, the situation may change in the long run. OpenAI CEO and co-founder Sam Altman said in a recent speech at Stanford University. “as long as we can pay the bills” He stated that he was not worried about high costs.

Despite high expenses, OpenAI has experienced an unprecedented increase in revenues since the launch of ChatGPT. The recently launched economical GPT-4o mini contributed to revenue growth by providing service to a wider user base with more affordable tariffs.

Currently, annual revenue from ChatGPT is approximately $2 billion, with an additional $1 billion from commissions for access to language models, bringing total revenues between $3.5-4.5 billion. However, this is still not enough to close the gap caused by spending.

OpenAI raised a total of $11 billion across seven funding rounds to reach today’s $80 billion valuation. An eighth round of financing may be on the horizon. What do you think about OpenAI and the future of artificial intelligence? You can share your opinions in the comments section below.