Is AI Profitable Yet? (opens in new tab)

AMD, Alibaba should be on there too. AMD is making good money on AI, with R&D at less than half the AI revenue. Whereas Alibaba's weird financials show it's kinda-sorta-protifable?

I just wanna know how the OpenAI/Anthropic shell game works long-term. So both companies made equity deals with infrastructure providers; OpenAI on Azure, Anthropic on AWS, GCloud, and Colossus. They get a loan of compute credits and then pay for the compute with the credits. So the PaaS are effectively giving them free compute, then book it as revenue; and the AI provider lets them do inference and books that as revenue. So, it's like both types of company have a buffet, and let each other eat there for free. But somebody has to actually buy the pasta salad, with real dollars. Afaict, those real dollars are.... the cash reserves of the PaaS.

How long are they going to eat into that cash? Microsoft and AWS don't really have their own models, whereas Google and SpaceX do. And while Google has tons of cash, SpaceX is perpetually looking for cash. So the only player here that can actually afford to keep doing this, or leave the game entirely, is Google.

It’s weird to me that people here suddenly seem to care about profitability for relatively early stage companies just because they’re “AI”.

I know a traditional SaaS company I worked for that IPO’d years ago and still has no signs that they can be profitable (and many others like it) and nobody seems particularly concerned.

For a rapidly growing new line of business, this isn't bad at all.

I am relatively pessimistic about the profitability of those panning for gold in the downstream AI market.

The core bottlenecks are power and computing capacity, and they actually trace back to the exact same issue. It all comes down to the physical energy it takes to flip or move a single bit inside the ram or disk storage. This concept is subject to fundamental physical barriers.

There are a few ways to tackle this, like improving power efficiency, reducing model size, or pushing hardware further. However, achieving orders-of-magnitude improvement in any of these areas will cost a massive amount of time and money. I wonder if governments, corporations, and investors have the patience to wait for these tech breakthroughs.

So Nvidia is basically farming everyone else?

Oh wow, they already got 50% of investments back in roughly three years? This is going to be insane money making machine. Or is it not the point op was trying to make?

Deepseek is really killing it if that's their total spend

How are the Google numbers calculated? I've seen their net income increasing a lot as they've rolled out Gemini. This suggests that Gemini tokens are actually profitable, or at least not extremely unprofitable.

Yet this site suggests that tokens are very unprofitable

Didn't see Radeon, but they have an AI page: https://www.amd.com/en/products/graphics/radeon-ai.html

Technically, the site doesn't show profits, it shows something like cash flow excluding investment flows, or has more money been spent than has come back in from customers.

This will always be negative for any new business as you are effectively depreciating the assets straight away. Like if you build a hotel and deduct the cost of building it from room income - it would take years before you get the money back but may be quite profitable with GAAP accounting.

GAAP accounting (Generally Accepted Accounting Principles) is what's used for official reporting and tax returns but excludes any increases in IP value or goodwill unless there's a buyout. If you included those the likes of OpenAI or Anthropic would have done pretty well. I'm not sure there's a word for that but basically value of the business less the money that's gone in. It doesn't get reported because 'value of the business' is guesswork and can be prone to BS but is pretty important to real world outcomes. AI is probably doing well on that one. Maybe why

>Is AI Profitable Yet? NO. Everyone's Broke.

doesn't fit with the top companies on the list having many billions in the bank.

AI startups taking unprofitable risky ventures in search of growth opportunity and future returns makes sense to me.

Maybe most of them or all of them lose on their bets, but there's potential for a future where revenue grows beyond the immense capex and research investments.

Oracle though... Immensely risky capex to service a startup industry with what will soon be a commodity...

Reminds me of the “Has The Turing Test Been Passed” website. It says no, but if you read on they cite “The relatively minimal funding allocated to AI research” as one of the reasons AI hasn’t been achieved “yet”. Website stopped being updated before it became relevant, so you will never see it say “yes”, similarly to how the Loebner prize mysteriously vaporized when GPT-2 came out, just when winning it for real started becoming an interesting possibility

Are we ignoring the 15 billion/yr deal with SpaceX/"Xai" and Anthropic?[1] Or is that not booked revenue yet?

[1] https://www.wired.com/story/spacex-ipo-anthropic-compute-fin...

I don’t think this website is fair. It does not factor in productivity increase and ROI from other areas that utilize AI to complete what they were doing. For example, if a new operating system was built into AI, the profit for that would go towards increased sales of licenses but this site seems to only track return on AI businesses

I don't have an MBA or anything but is it common practice to describe "revenue - capex" as "profit"?

That's pretty funny. For the "yet" part I would have expected a more recent cutoff, rather than the whole history of the companies. (Do they all have some kind of enormous debts they're going to need to pay off for decades once they do become profitable?)

Gemini now remembers you wholesale and makes good analogies and shortcuts knowing youres personal capabilities. You are already hooked and paying starts any day now. Or maybe it starts recommending some marvellous products somewhat related to your query.

The numbers for Meta are pretty misleading, I assume the $3 billion is something like direct generative AI revenue?

Sure they're torching money on building consumer LLMs, but they seem to be doing very well optimizing things like ad ranking

https://engineering.fb.com/2025/11/10/ml-applications/metas-...

https://engineering.fb.com/2026/03/31/ml-applications/meta-a...

NVidia showing so much profit, even they have acceess to some models like QWEN for free. Talking about Anthropic and OpenAI, they charge so much, I dont understand this graph.

Possibly profitable for New-Gen Labs (DS, Qwen, Kimi, etc) and impossibly unprofitable for the Legacy Labs (OpenAI, Anthropic)

Is the "$ Spent on AI since page load" broadly indicative of spend at all, or just a fun animation?

I know not the point, but is "PNL" a term people use now vs P&L?

For some use cases, AI has been profitable for at least a decade.

Xai is making 1.25B a month off it's compute? Why is that not listed?

Nvidia making out selling shovels, that's for sure.

Never bet against Wall Street and jewish capital, they will make money off AI by hook and by crook. If necessary, they will push for escalation with China and enforce a global ban on Chinese AI. You may disagree, but after the experience of 200 years of Western capitalism, you will have to explain why this time it will be different.

Remember the model:

1. Outspend and outlast your competition until you have market dominance. Win over and lock in your customers with sweetheart deals.

2. Enshittify and squeeze your customers to pay back your debt.

If you're using AI, you're not paying the true cost right now because we're in phase 1. Be ready for phase 2.

Why does NVIDIA, the most profitable AI company, not simply eat all the other non-profitable AI companies?

This site is going to start doing the opposite of the author's intentions in a couple of years.

Did someone say shovels?

I've received some decent benefits from it without paying anything.

Now use common accounting standard and amortize the cost.

Oh it doesn't fit the narrative. Never mind then.

Sell shovels.

Wow, the industry is only 50% in the hole during such a massive buildout that overburdens supply chains of such basic and general resources as energy and chips? This is going to be insanely profitable in less than a decade. I'd be delighted if a business I had put 100k in aleready had a 50k return, after first 3 years or so, while I'm buliding it in conditions where everybody else is doing pretty much the same.

Most startups are deep in the red for years before they even have any revenue. Is that any different?

This ignores how much the stock has grown due to AI.

Also many of these companies like Amazon, Google, and Meta drive a lot of incremental value due to both AI powered content suggestion and AI powered ad suggestion. Personalized ads has driven a ton of revenue.

Anthropic is going to be profitable in the June quarter

https://www.cnbc.com/2026/05/20/anthropic-revenue-explosive-...

This is pretty funny. Now do it without Nvidia and including all costs, not just capex.

Comparing fixed costs to revenue? Even if it’s cumulative this seems like a disingenuous framing

Yes, I spend my days writing lots of code using AI (I do rigorously review it, it's still much faster than hand typing) and I get paid enough for it to pay mortgage and send kids to college.

To be honest whatever author wanted to say there three categories of AI related companies: hardware manufacturers, cloud providers and purely AI companies.

Only the later have something to lose if AI bubble gone by tomorrow. Everyone else will just stay with grown capacity and reuse infrastructure for whatever.

Not listing other hardware companies is just dishinest. AI is not a crypto mining where resources are just burned.