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Comment by erfgh | Hacker News Reader

They are subsidized by the huge losses incurred by the AI companies.

Data from OpenAI shows their 2025 inference revenue exceeded their cost of inference by a good margin (https://cdn.arstechnica.net/wp-content/uploads/2026/06/opena...). Saying this is being subsidized is like saying any investment in future productive assets is "subsidized".

Anthropic have claimed they expect their first profitable quarter this year. As far as we can infer their current API prices have decent margins.

Anyone can claim they are profitable, simply by reclassifying their expenses as some other thing or shuffling them to separate corporate structure. Until we will real financial audit, the CEOs claims are just a hot air.

OpenAI's leaked documents also said OpenAI was profitable on inference. The small resellers of open models have nowhere near the resources to optimise their models or inference and yet usually have a lower cost, why wouldn't the big labs?

That is exactly the document I've been thinking about while writing top comment :) . Oh, our "cost of revenue" is smaller than the revenue, we are so profitable guys! If we just don't count our marketing expenses, our administrative expenses, and our unspecified losses from operations to the tune of x3 times higher than our revenue. But if we don't count them we are totally profitable guys! If we will just stop all RnD and also stop paying our salaries, support and marketing departments (and also cut 20 billion of operational losses too, whatever that is) we will earn soo soo much monies guys!

Fair to include A&G, but their marketing and training cost is about generating future growth. People say that the subscriptions are highly subsidized as if its fact -- it's certainly not a well-established fact. These people simply don't know the truth one way or another, but portray their not well supported opinion as fact.

The leak really doesn't say that. We have no way of knowing what posts are in the different categories.

Only if those losses are coming from subscriptions, instead of capex and training, which is not at all clear.

I don't understand this argument. How does it make the subscription any less subsidised if the losses are only because developing the product is just so darn expensive?

Feels like arguing that it's not clear if Bugatti's losses came from selling the Veyron instead of designing and developing the Veyron.

The equivalent is when Amazon was running a loss because they were spending all their money on building warehouses. It exactly make sense, but that's the argument.

How often does Amazon have to rebuild their warehouses?

> It (doesn't) exactly make sense

I missed the word don't, originally. Apologies.

this argument assumes that capex and training costs will go down over time. but theyll have to keep up with one another and stay on top of latest knowledge so Im not sure if thats true

"Our 2015 car models are totally profitable if we will just stop making new cars and continue producing only 2015 models for the next decade."

From the article:

> What is happening here is that leading AI labs are charging not only for inference but also for research in model architecture, training data collection and curation, model training cost (which can be tens or even hundreds of millions of dollars), paying their employees and recovering the marketing costs.

That's what's being subsidized.

You are saying it as if those costs were not necessary to provide the service.

OpenAI inference revenue exceeds its cost of inference by a good margin in 2025 (https://cdn.arstechnica.net/wp-content/uploads/2026/06/opena...)

Great, but that's only a part of operational costs. A craftsman's revenue may exceed the electricity bill for the power drill, doesn't mean the business is sustainable.

Day 2 the craftsman has not made up for the investment/loss of their equipment. Not a useful example.

Sorry, I don't understand what you are trying to say.

The craftsman, who may otherwise be profitable, also has investment costs that cause them to show a loss for some time.

"Otherwise". If the craftsman revenue isn't enough to recover the investment expenses, the business is operating at loss. But that's beside the point, because research investments are not the issue at hand.

As said before: Interference costs are not the only operational costs. Same as electricity costs for the craftsman. Running a power drill is not the the whole expense to consider. The craftsman has to eat, AI company's employees have to eat. The craftsman has to learn about new building standards, the AI company has to train their models because no one wants to use a product stuck in time (that's not "research", just maintenance). If not even interference was recovered in revenue, nobody would even start to argue about sustainability.

I can't debate this further, because HN is rate limiting my account for dissenting opinions in the past.

They are not. They are necessary for the development of future models, which does not influence the availability of the current ones. Plus you have chinese models distilling current SOTA for pennies on the dollar, so as a consumer I never will be worse off in the long (1-2 years) run.

Is this supposed to be some sort of gotcha? Apart from research and marketing, that's operational costs. I mean, every product could be cheaper, if you didn't have to pay for employees and means of production.

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