OpenAI’s viability called into question by reported inference spending with Microsoft

OpenAI may be burning far more capital serving its GPT-family of models than previously thought. Leaked documents show the company paying more than $12 billion to Microsoft for compute power since 2024 and suggest much weaker revenue than it needs to pay for all those expenses. According to internal Microsoft financial …

[Ian Johnston]

OpenAI's ... what ... called into question?

[cyberdemon]

..Credibility?.. No, that wasn't it

[The Man Who Fell To Earth]

Check Kiting Accounting

Like everything else in AI.

[beast666]

Chad Gibbity is unfit for purpose.

[fb2k]

this goddamn AI bubble can't crash quickly enough

[Zoopy]

Wouldn't the right term be "accurate"?

[Jedit]

"Wouldn't the right term be "accurate"?"

I couldn't say. I'm not even sure what term in that sentence you're trying to replace with "accurate".

[Anonymous Coward]

A bigger Ponzi scheme than Enron, Theranos or Crypto.

Sam - enjoy your cell next to Elizabeth Holmes.

Make sure it has CCTV on the door.

[JLV]

Be careful what you wish for.

Some of the more sober financial analysts sounding the alarm are also pointing out that there has been so much investment into AI that it would be quite a painful crash. Esp. as the AI boom has been masking a lot of the Trump slump.

[UnknownUnknown]

You can see it with the financing deals been done for data centres and 30 year bonds.

They will get turned into derivatives and flogged to suckers.

OpenAI is burning cash at a multiple 2-3x income.

Google, Microsoft, Meta. Oracle and X can bury bury the numbers to an extent and booking $30bn annual revenue projections from Open AI is future revenues further inflating shares.

US has growth rate similar to UK if you remove the AI bubble effect. It’s not going to end up well. Global Crash and further Quantitive Easing/Debt.

At least interest rates will crash back to near zero for debtors and (new) Government Debt.

The rich and commodity and share traders never learn as it’s someone else’s money. The rich have vacated The tech shares bubble already and can invest cheap on the crash.

(I wish aI had hoovered up a pile of mildly risky Rolls-Royce shares during their Covid time in the toilet ).

[Anonymous Coward]

It already did but people are still hallucinating that it's still inflating.

[Mike VandeVelde]

A use for AI!

Please summarize Ed Zitron's latest newsletter.

Thank you for making that not necessary!!

(and thank you Ed Zitron, but wow he does bring all the receipts)

[iron]

Perhaps Mr AltMan is using AltMaths dreamt up by his hallucinating parrot when he quotes figures.

[MyffyW]

Indeed ... and "Capital" is a curious thing to call revenue expenditure on Azure fees.

I'd call it smoke and mirrors, but the mirror would imply a tangible asset.

[wolfetone]

You know when you have bubblegum and you blow the bubble, and it gets larger to the point it starts to become translucent just before it breaks? We're there with AI.

Micro$oft have skin in the game with OpenAI remember. M$ are investing heavily in AI. They're pumping Crapilot in to fucking everything without being asked to, and pushing it on all Office364 users like a drug dealer outside the gates of a school.

If OpenAI is a loss maker to the point there is no ROI, then M$ will get hurt badly. As would every other jackass AI operation.

Whats more, when DeepSeek came out remember who was loudest of all saying their claims of doing it on the cheap were bollocks? Yeah, same company that it seems can only operate their AI by throwing cash at it without any real hope of recouping it.

[Anonymous Coward]

I think the main takeaway from this is that if you are relying on OpenAI-based products for parts of your business then expect your costs to rise significantly over the next few years - even if OpenAI as a company fails, MS or someone else will snap up their software for its (captive) customer base.

[Zippy´s Sausage Factory]

We're in the "discounted hit from your dealer" phase at the moment I guess. Of course prices are going to rise dramatically - just as soon as there's wide enough deployment of AI that it's nigh on impossible to avoid it.

[retiredFool]

I think similar to the deployment of sat cell svc. I mean the real number of people who need it must be tiny. And the free drug period is going full tilt. T-Mobile sends me a text about every 2 days reminding me to sign up for "free" 911 sat service. Thanks, no. I know a coke deal when I see it.

[David Hicklin]

> wide enough deployment of AI that it's nigh on impossible to avoid it.

And the smaller players have been gobbled up leaving a mon/duopoly behind and a captive audience who have laid off all those workers .....

[JacobZ]

Microsoft knows best

Microsoft knows exactly what OpenAI's revenues are, because it gets a cut.

And it knows what OpenAI's losses are, because it has to report its share in its own quarterly reports.

And of course it knows how much (little) it is paying OpenAI for reselling its models on Azure (bear in mind that under 2% of Microsoft 365 users are licensing Copilot).

And knowing all that... Microsoft is partnering with Anthropic (https://www.cnbc.com/2025/09/24/microsoft-adds-anthropic-model-to-microsoft-365-copilot.html)

[Tron]

I'm shocked by this.

People actually pay for AI?

Crazy stuff.

[ABugNamedJune]

It's the same money caught in a loop.

I keep seeing these headlines about Open AI paying $12 billion to Microsoft, and headlines about Microsoft paying $12 billion to NVidia, and headlines about NVidia paying $12 billion to OpenAi, and I keep seeing all these ridiculously high valuations for these companies, and I'm realizing it's all just the same money caught in a loop.

I should have come up with this strategy myself, I could make my company worth a trillion dollars by just slipping a few hundred into the smoking circle and let my stoner friends pass it around.

[Version 1.0]

Re: It's the same money caught in a loop.

Originally Microsoft updated the operating systems to help users work well and be happy. Now that AI has appeared everything is updated regularly to make AI more money and make Microsoft happy and get all the users money.

[druck]

Re: It's the same money caught in a loop.

Rose tinted glasses. Microsoft have always been money grabbing shits, it's just far more obvious you aren't getting anything useful in return with AI.

[mcswell]

Re: It's the same money caught in a loop.

My wife and I are going to do this. So long as it's not taxable income, we'll have tremendous cash flows!

[Anonymous Coward]

It's not even right to call this a bubble. It's an outright scam.