Profit is money you couldn’t figure out how to spend. During growth, you want positive operating margins with nominal profits. When the company/market matures, you want pure profits because shareholders like money. If you can find a way to invest those profits in new areas of growth, that’s better.
Profit is the money showing your business is sustainable. Ever since the ZIRP era US companies keep haemorrhaging money at a rate that is physically impossible to recoup.
If OpenAI plans to lose 100+ billion dollars per year for half a decade, what profits are you talking about to offset the losses?
> When the company/market matures, you want pure profits because shareholders like money.
Ah yes. Shareholders like money. And not, you know, basic accounting like "we need money to actually pay salaries, pay for equipment and offices etc. without perpetually relying on seeming endless investor money".
You don’t need profit to offset the losses.
You can simply reduce spending / expenses.
One does not “simply” reduce spending.
Why does stock price go up after mass layoffs?
Company would no longer function of course but why it would matters if the stock price is through the Moon?
Notice I said you should have nominal profits.
> Ah yes. Shareholders like money. And not, you know, basic accounting like "we need money to actually pay salaries, pay for equipment and offices etc. without perpetually relying on seeming endless investor money".
All of these are costs that reduce your profits.
A maximally profitable business fires all employees except shareholders, closes every office, stops all RnD, and leases IP or real estate to others on long-term deals that never need to be renegotiated.
Everyone wants to treat OpenAI like a car wash business where they need to make a profit almost immediately. I don’t know why people can’t understand that the industry is in a rapid growth stage and investing the money is more important than making a profit now. The profits will come later.
The nearly $1T hand wave. Forgive me if I ask how. Might give it some credence if Anthropic and Google weren't pulling even with or surpassing them in various way or markets.
Whats worse is they mostly seem to have retail market name recognition which is arguably the hardest, or maybe the impossible market to make money from.
Whats worse is they mostly seem to have retail market name recognition which is arguably the hardest, or maybe the impossible market to make money from.
Apple is another one that focuses almost exclusively on retail and is also one of the most profitable in history.
Holy crap, is it the year 2000 again?