Anthropic's "Profitability" Swindle

This author is out of touch with how much people are spending on Claude tokens. People are spending tens of thousands of dollars per month on Claude tokens.

For example, according to a leaked internal dashboard from Meta, employees used 60 trillion tokens in one month. The top user consumed 281 billion tokens in one month tokens, which cost approximately $1.4 million. With an enterprise discount, Meta probably paid $500 million for these 60 trillion tokens.

I can completely understand how Anthropic is projecting $3.5 billion/month in revenue.

> Dario Amodei and Elon Musk worked out a sweetheart deal, which they - framed as a “ramp-up,” - that allowed Anthropic to artificially depress its costs. I also question how much of a ramp-up there really was, or what Anthropic’s actual compute constraints were, because it immediately loosened rate limits for Claude subscribers on announcing the deal, meaning that it immediately started having higher inference costs, which…somehow led to it making a higher profit? Or did Musk — as literally described in its S-1 — have SpaceX charge Anthropic less for two specific months to make the numbers look better?

Given xAI is struggling and seemingly that Musk has sold compute capacity to Anthropic, what's the play here? To screw with OpenAI's IPO?

> Let me speak directly and with more empathy than usual: if you want Anthropic to win, you should be just as skeptical of these numbers as I am. You should want to smash my face in the tarmac with the most crystal-clear, impossible-to-argue with numbers, bereft of asterisks or discounts from suppliers or obfuscated accounting metrics.

Love Ed or Hate Ed, he has a point.

I bet that in 10 years they will name the next financial (and perhaps economic) crisis "the subsidized bubble"

Until they find someone else paying the costs it will not pop.

This seems related: https://news.ycombinator.com/item?id=48240156

There’s a pretty clear example of Zitron being dishonest here:

> I also severely doubt that Anthropic managed to make the cost of running its services profitable in the space of six months.

> [Per The Information in January], Anthropic missed on its gross margin projections, saying that its inference costs were 23% higher than the company had anticipated.

> How did Anthropic, which faced a massive influx of new business to the point that Anthropic was forced to buy more compute from Elon Musk, magically become profitable? Other than that discount, of course.

If you follow the link to The Information, you’ll see that it’s a paid article with the headline “Anthropic Lowers Gross Margin Projection as Revenue Skyrockets”. But what happens when you actually read the article?

> Anthropic last month projected it would generate a 40% gross profit margin from selling AI to businesses and application developers in 2025, according to two people with knowledge of its financials. That margin was 10 percentage points lower than its earlier optimistic expectations, though it’s still a big improvement from the year before.

— https://archive.is/aKFYZ

So, according to Zitron’s own source, Anthropic are actually earning 40% gross profit margin on inference, and that is a dramatic jump upwards! This totally contradicts his position that it’s an implausible “swindle” for Anthropic to claim profitability. He’s counting on the fact that most of his readers don’t subscribe to The Information and will only see the headline, or that they will just see a citation and trust that it backs him up without checking.

It really appears to be a naked pump and dump scheme.