OpenAI is making billions in sales but struggling to stem its losses.
The challenge of keeping up with Anthropic competing in the booming artificial intelligence market is evident in OpenAI's rising revenue, offset by ongoing operating losses, the Wall Street Journal reports.
The numbers highlight the gap between sales growth and financial sustainability, the publication notes, citing key figures that OpenAI shared with investors:
Revenues rose to $10 billion in the third quarter, an increase of about 50% from the previous quarter.
Adjusted operating losses increased from $10.1 billion to $10.9 billion.
Adjusted operating profit improved from 150% to 109%, meaning losses are narrowing relative to revenues.
Calculations reportedly do not include stock-based compensation, which rose to $2.6 billion in the third quarter.
The results contrast with those of Anthropic, whose revenue reached $17 billion in the third quarter, while its operating loss was a relatively modest $567 million.
OpenAI is slashing prices on its latest models to gain ground in the enterprise market, where businesses are looking at cheaper alternatives to anthropomorphic cloud. Third-party data suggests the strategy helped it recover some market share in the third quarter.
OpenAI reportedly achieved less than half of its initial $30 billion target in its latest funding round and is looking for additional investors.
Anthropic is gearing up for a highly anticipated IPO next week, targeting a valuation of $1.33 trillion — well below the $2 trillion figure previously floated.
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