OpenAI told investors Tuesday that its third-quarter operating losses topped $10.9 billion, up from $10.1 billion in the previous quarter. The ChatGPT maker’s revenue grew by around 50 percent from the second to the third quarter, according to The Wall Street Journal, but that wasn’t enough to offset its expenses. The figures show how large a gap it still needs to close to reach profitability.
Futurism argues that the increased revenue also came at the cost of breaking a core promise, placing OpenAI’s advertising reversal alongside its abandonment of its stated commitment to open-source AI development.
OpenAI began showing ads in ChatGPT in February, despite CEO Sam Altman previously calling the idea “unsettling” and vowing it would be used only as a “last resort.” Its chief competitor, Anthropic, mocked the reversal in a series of Superbowl commercials, and many users were furious.
OpenAI hasn’t officially reported how much revenue those ads generate. In August, however, it said its advertising division was on track for a $1 billion annualized revenue run rate, rather than reporting $1 billion in completed sales.
The results follow controversy over OpenAI’s revenue projections. In October, the company reported annualized revenue of about $50 billion, an estimate of how much revenue it would generate over a year. That was $20 billion short of what it had told investors only a month earlier.
The discrepancy was interpreted as an admission that AI companies’ business models weren’t as robust as their leaders had portrayed them, fueling speculation about an impending bubble.
OpenAI and Anthropic also face greater scrutiny as each prepares for an IPO expected to be historic. Those preparations have intensified their rivalry, with OpenAI making strides to catch up to the Claude maker in enterprise sales. Futurism describes Anthropic as having cornered the corporate customer market with its coding tools, while OpenAI has lagged with a more broadly consumer-focused model. Still, OpenAI’s president said last week that enterprise sales now generate most of the company’s revenue.
In just a few years, AI has gone from a marginal part of the tech industry to one of its leading sectors. Futurism’s conclusion is that unless frontier labs like OpenAI find a way to make money rather than keep burning it, investors will start asking hard questions.
