US EditionOpenAI Big Chip Orders Dwarf Its Revenues—for Now
OpenAI is securing over 10 million high-powered chips through complex financing despite billions in losses and no expected profitability until 2029, analysts say.
- This month, OpenAI committed to buying 26 gigawatts of processors and more than 10 million units, tied to vendor financing deals with Nvidia, AMD and Broadcom.
- OpenAI's financials show it forecasts billions in losses this year despite about $13 billion revenue, driven by rapid growth and over 800 million ChatGPT users.
- Analysts warn even selling stakes at a $500 billion valuation won't cover chip commitments, as Gil Luria said, `They will need hundreds of billions of dollars to live up to their obligations` and called it `another unhealthy dynamic`.
- Observers warn deep-pocketed rivals like Google and Meta can self-fund AI infrastructure from ad profits, while Bernstein Research analyst Stacy Rasgon says Altman’s bets carry high-stakes economic risks this month.
- Josh Lerner, Harvard Business School professor of investment banking, said `There is very real demand today for AI in a way that seems a little different than the boom in the 1990s` while OpenAI declined to comment on its financing strategy.
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OpenAI, expanding in the field of AI, orders chips for hundreds of billions of dollars, raising questions about the financial viability of such investments
Watauga Democrat
OpenAI big chip orders dwarf its revenues
OpenAI is ordering hundreds of billions of dollars worth of chips in the artificial intelligence race, raising questions among investors about how the startup will finance these purchases.
In the fast-paced AI race, OpenAI makes chip orders for hundreds of billions of dollars, amounts that do not correspond to its current revenues and that worry some investors.In less than a month, ChatGPT creator has committed to Nvidia, AMD and Broadcom to acquire 26 gigawatt (gw) power processors, which represents at least 10 million units in total and requires an electrical production of more than twenty nuclear reactors. “They will need hundr…
OpenAI is making orders worth hundreds of billions of dollars for the purchase of microchips, entering the artificial intelligence "race" strongly, but investors are worried about this development. More...
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