Amazon-Backed Anthropic Seen Turning Profitable Two Years Ahead Of OpenAI: Report

• Internal documents and projections, sourced by the Wall Street Journal, show that Anthropic expects to turn a profit by 2028 and OpenAI by 2030.
• OpenAI reportedly forecasts $74 in operating losses in 2028.
• The reports highlight diverging approaches to growth by two of the world’s largest AI companies at a time when a section of the tech community is growing uneasy with sky-high tech valuations and AI capital expenditures.   

Amazon.com, Inc.-backed Anthropic is on track to turn a profit far more quickly than rival OpenAI, according to a new report in the Wall Street Journal, which cites internal documents and projections.

Internal Projections

Anthropic, known for its Claude AI chatbot, expects to break even for the first time in 2028. By contrast, OpenAI forecasts $74 in operating losses that year, roughly three-fourths of its projected revenue, largely due to ballooning spending on computing costs.

Instead, the ChatGPT operator expects to turn a profit in 2030, based on projections shared with investors and reported by the WSJ. 

The documents indicate that OpenAI anticipates burning $9 billion after generating $13 billion in sales this year, while Anthropic expects to burn nearly $3 billion on $4.2 billion in sales.

All considered, OpenAI expects thinner margins than Anthropic from its sales for the next five years. Yet it is investing far more in the chips and data centers needed to build its AI technology, and doling out more stock-based compensation to attract top researchers.

The WSJ report noted that OpenAI’s aggressive strategy requires near-constant fundraising and could backfire if markets cool on the technology or its near-term profitability.

The Bigger Picture: AI Bubble Or Boom?

Big Tech giants are projecting higher capital spending on AI and related infrastructure over the next year, suggesting a healthy near-term outlook for AI adoption. However, a growing chorus warns that future revenue gains from AI may not justify the current sky-high tech valuations or the massive sums being poured into the technology.

OpenAI has set an ambitious target to invest $1.4 trillion in cloud capacity expansion over the next eight years, and recently signed a string of deals with giants such as Nvidia and Oracle. CEO Sam Altman last week said OpenAI has the capacity to fund that on its own.

For updates and corrections, email newsroom[at]stocktwits[dot]com.

Read Next: Sony Lifts Profit Outlook After Blockbuster Games And Anime Quarter

Share

·

Add us on