OpenAI recorded a roughly 50 percent increase in quarterly revenue to 10 billion dollars, despite continuing to report substantial operating losses, according to a Wall Street Journal report. The figure, carried in Wednesday market reporting, shows the ChatGPT maker growing at a pace that few companies of its size have ever managed, even as it spends heavily to stay ahead.
Why it matters
The growth comes with a cost. OpenAI continues to report substantial operating losses, driven by the computing power needed to train and run its models, and the losses are the reason the AI financing debate matters. CoreWeave beat estimates this week by selling that same computing power, and SoftBank posted a 7 billion dollar loss on its data centre bets, so the whole supply chain is under the same pressure. Anthropic listing on November 19 will be judged against the same benchmark, and a 50 percent jump sets a high bar for every AI company that follows.
The timing matters for the listing market. Anthropic is targeting a 1.4 trillion dollar valuation in its IPO, with shares expected to start trading on November 19, and OpenAI revenue growth is the benchmark every investor will use to judge it. A 50 percent jump to 10 billion dollars a quarter sets a high bar, and it says the demand for AI is real even if the profits are not yet.
What happens next
The wider AI trade is split on the same question. Nvidia steadied after wiping 430 billion dollars off its value in two days, Asian stocks rallied on CoreWeave earnings, and the Nasdaq fell 0.74 percent on the hot CPI print. The market wants growth and profits at the same time, and OpenAI is delivering only one of them.
What happens next will be decided by whether the revenue growth can outrun the spending. If OpenAI can narrow its losses while growing 50 percent a quarter, the valuation case is made. If the losses grow with the revenue, the financing questions that hit SoftBank will reach OpenAI too. For now, 10 billion dollars a quarter is a number that commands attention. The growth comes with a cost, as OpenAI continues to report substantial operating losses driven by the computing power needed to train and run its models.
