DeepSeek announced that each GPU they have makes about $38 an hour in revenue during off-peak times. That's $331k a year, and DeepSeek is cheap.
I think that it's not only possible but likely that the frontier labs are profitable on an ongoing basis, and it's mainly the research and capex which make them look like impending disasters.
Realistically, OpenAI and Anthropic are each probably worth ~$1T each. Anthropic can already easily justify that based on revenue alone. OpenAI isn't far off. Consider how quickly these companies are growing and the fact that they maintain a small but significant edge, I don't think the bubble is going to pop. Just deflate a little.
I think that it's not only possible but likely that the frontier labs are profitable on an ongoing basis, and it's mainly the research and capex which make them look like impending disasters.
Realistically, OpenAI and Anthropic are each probably worth ~$1T each. Anthropic can already easily justify that based on revenue alone. OpenAI isn't far off. Consider how quickly these companies are growing and the fact that they maintain a small but significant edge, I don't think the bubble is going to pop. Just deflate a little.