OpenAI is arguably the most sought-after AI lab in the world, though tech leaders like Microsoft CEO Satya Nadella have attributed its immense success in the AI space to a 2-year runway for building and developing ChatGPT uncontested. Perhaps more interestingly, we recently learned that Bill Gates was against Microsoft making a $1 billion bet on the ChatGPT maker in 2019. “You’re going to burn this billion dollars,” Gates warned Satya Nadella.
However, OpenAI CEO Sam Altman recently revealed that Microsoft and Satya Nadella’s “early conviction” played a major role in the company’s success. That said, the company’s finances have been under tight scrutiny by investors amid claims that we’re in an AI bubble that’s on the verge of imploding.
OpenAI reportedly generates up to $13 billion in revenue annually from ChatGPT and LLM access fees. However, this figure barely dents its projected $1.4 billion spending on computing. But according to Altman:
First of all, we’re doing well more revenue than that. Second of all, Brad [the host], if you want to sell your shares, I’ll find you a buyer. I just… enough. I think there are a lot of people who would love to buy OpenAI shares.
The executive indicated that OpenAI’s revenue is “growing steeply,” further highlighting that the company expects the demand across its consumer and enterprise businesses, including ChatGPT and future hardware developments, to see a surge in demand.
According to Sam Altman:
“We are taking a forward bet that it will continue to grow, and that not only will ChatGPT keep growing, but we will be able to become one of the important AI clouds, that our consumer device business will be a significant and important thing, that AI that can automate science will create huge value.”
Microsoft CEO Satya Nadella is seemingly optimistic about OpenAI’s business operations, revealing that it has “beaten every business plan” it has presented to the tech giant.
Altman dismissed claims that OpenAI was going to turn into a public company next year:
No no no, we don’t have anything that specific. I’m a realist, I assume it will happen someday, but I don’t know why people write these reports. We don’t have a date in mind, we don’t have a board decision to do this or anything like that. I just assume it’s where things will eventually go.
“One of the rare times it’s appealing is when those people are writing these ridiculous ‘OpenAI is about to go out of business’ [posts], I would love to tell them they could just short the stock, and I would love to see them get burned on that,” Altman added, with a hint of vengefulness.
Later in the interview, the host predicted that the company could potentially reach $100 billion in revenue by 2028 or 2029. “How about ‘27?” Altman interjected.
FAQ
What is an IPO?
An IPO is an Initial Public Offering, a private company offering its shares to the public for the first time, which in turn, allows it to become a publicly traded company.
How much revenue does OpenAI generate annually?
Recent reports that the AI firm generates up to $13 billion per year from ChatGPT and LLM access fees. However, OpenAI CEO Sam Altman projects that the figure could skyrocket to $100 billion by 2027.
How much stake does Microsoft hold in OpenAI under its new business structure?
Microsoft is OpenAI’s largest backer, investing up to $13 billion in the company since 2019. However, the company signed a new definitive agreement. Under the firm’s recapitalization, Microsoft now holds an investment in the Public Bunsiess Corporation (PBC), which is valued at $135 billion, or roughly 27% of the company on an as-converted diluted basis.
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