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Lemmy, this is the fourth year in a row that “OpenAI bankrupts soon” articles are being posted:
Year Article Explicit bankruptcy claim 2023 Business Today — “OpenAI might go bankrupt by end of 2024”, August 12, 2023 OpenAI could go bankrupt by the end of 2024 because of ChatGPT’s high operating costs, mounting losses and dependence on continued Microsoft funding. 2024 ITPro — “OpenAI could go bankrupt in 12 months if it doesn’t raise some serious cash”, August 7, 2024 OpenAI could go bankrupt within twelve months unless it secured substantial additional financing. 2025 Braden Kelley — “Is OpenAI About to Go Bankrupt?”, December 4, 2025 The article explicitly asks whether OpenAI is “on the brink of bankruptcy” and argues that its spending and business model may be financially unsustainable. 2026 Windows Central — “OpenAI might torch $14 billion in 2026, hitting bankruptcy by next year”, January 20, 2026 OpenAI could burn through approximately $14 billion during 2026 and face bankruptcy by mid-2027. OpenAI isn’t going anywhere.
It could be an Auryn. It symbolizes the fucked up circular market flow between software and hardware manufacturers and how their greed is a neverending story.
I like that the articles main image looks like a giant gold turd.
An Ouroboros made of shit
I presume it’s supposed to be a (golden) snake eating itself. Could also be a mom protecting her eggs.
Fingers crossed! Let it burn.
“grim”
Every bubble has created something we use every day. AI isn’t going anywhere.
You use tulips every day?
Don’t forget the AI bubble is also a ram and SSD bubble.
That is not a bubble, it’s a shortage caused by a bubble.
You bundle and sell subprime mortgages every day?
You use the world wide web every day?
Mortgages are used everyday.
Railroad are used everyday
The interest is used everyday
Amazon is used everyday
Those are the big bubbles in recent history.
I will happy when this bubble bursts. OpenAI, Grok and several other companies offer nothing substantive and if they’re burning cash and disrupting economies then just die already.
nothing substantive
You were saying? 🤨
offer nothing substantive
Like industrial farming, there is nothing new, but now everybody can create memes and create software. Society will change.
Let’s accelerate the the process. What’s the AI query version of DDOS?
Yes, they could just set more limits… but itll still shave the time sooner.
I’m really disappointed in this thread.
There are a number of people who are recommending buying their cheapest plan under the premise that it will put them under since it is a loss leader. Despite the popular fantasy, the rich and powerful are not stupid. You don’t know more about a company or market from passively consuming headlines than the leadership of that company. So, I’ll state the obvious: If you don’t like a company or industry, the last thing you should do is give them your money.
I’m sure a bunch of people with excel sheets to monitor their credit card points will show up in the replies to argue about how it’s theoretically possible, but I will reiterate: The leaders of the companies are not stupid. If they started seeing a net loss from their sales strategy, they’d change strategies.
The leaders of the companies are not stupid. If they started seeing a net loss from their sales strategy, they’d change strategies.
Unless money is not the goal. Not the sole goal at least. As you said, they’re not stupid. It’s entirely within reason to assume they may be aiming for more than just money.
Who knows what they’re planning. Nothing good for us - that’s for sure.
While I agree with not buying being better that giving them money. I can’t agree with leadership being smart.
This thing was never going to be profitable. So they either:
a) they’re actively malicious — they were never planning on profiting which means this is basically a pump and dump scheme capable of triggering some form of recession;
b) they’re fucking morons for believing their own fantasies, which judging by their public appearances would track.Former seems just as plausible, but my bet is on the latter. These AI bro CEOs seem to be woefully average at best.
“Never attribute to malice that which is adequately explained by stupidity.” - Hanlon’s Razor
I assume you’re operating off this principle, and I understand the point, but it’s ill conceived for our purposes. Where malice and stupidity are functionally identical, preparing for malice is equivalent to preparing for stupidity. Where malice and stupidity differ, malice is more dangerous and requires greater preparation. Hanlon’s Razor is a good perspective to prevent escalation in cycles of revenge, but it’s bad perspective for strategy.
It’s safe to assume some portion of highly educated and entrenched powers are willing to undermine the public good for their own gain. We shouldn’t allow our selves or our peers to dismiss potential adversaries as stupid. Even if the leadership was composed entirely of nepo-nitwits, there are competent people working for them, advising them, and benefiting from their success.
I want this response to be higher. This is an excellent take.
I’ve worked too many places where “b” is absolutely the answer. Even small companies that you’ve probably never heard of where management is drinking the koolaid. They usually don’t like being asked why someone would actually pay for whatever bullshit they’re selling. The answer, almost without exception, is because one of their CEO buddies told them it was a good idea.
Counterpoint:
They already are losing money. They themselves do not project that they will be profitable until 2030. The idea that “smart people with spreadsheets won’t let them lose money” is obviously wrong because they have done nothing except lose money, ever.
They get thier operating capital from funding, not sales.
Now, I agree that the gambit is wrong. So you’re right. You’re just right for the wrong reason.
Funding is just the cash value of market optimism for the future of your product. High usage props up optimism. Social media IPOs were valued very much based on active users, the idea being that more users meant more opportunity for profit.
The more people actively using these tools, even if they’re just maliciously burning tokens, just add to the “active users” metric. Which makes funding easier. And funding is the ACTUAL way these companies “make thier money”.
Sure, they’re in the business of selling shares not AI-tokens. Standard bubble stuff. Doesn’t change the overall point.
Yeah, I conceded that your call to action was correct.
Just wanted to add colour so people understand the mechanics at play. When you understand them, it lets people evaluate other things, without needing you to tell them what to do.
For example, if your comprehension of these companies is that the companies are acting with the goal of profitability l, they would see something like a fast-track onto an index post IPO as a bid for legitimacy, some kind of ego play.
If you comprehend it as a beast that can only subsist on funding with no viable product, it entirely changes how you comprehend the post IPO index listing desire.
Despite the popular fantasy, the rich and powerful are not stupid.
Uh… famously untrue. Mental illness has plagued monarchs, pharaohs, and caesers for millennia. That’s long before you get to all the quirked up white boys and trad rad girl bosses currently running things.
You don’t know more about a company or market from passively consuming headlines than the leadership of that company.
Okay, but you can review their balance sheets and their primary lines of credit. Case in point, Sam Altman is heavily reliant on three big financial partners - Softbank, Oracle, and NVIDIA. Two of these are - themselves - hemorrhaging money thanks to large capital outlays that have failed to produce substantive returns.
There are finance journalists who get out ahead of this and report their own analysis. And you can find that in a thousand different private journals, substacks, and podcasts. But you can also go do the grunt work yourself if you’re ambitious.
OpenAI’s financials have been disclosed already (although the official SEC filing is still upcoming). So… just read them if you doubt what you’re reading in the news. But it’s not some kind of secret that the business is operating at a loss, with a fixation on debt-fueled growth. The argument is over future projected revenue, which isn’t something business leadership can be any more certain of than a passive media consumer.
I definitely get the knee-jerk impulse to announce “business professionals know more about business than internet idiots”. Because, sure. True. But the idea that business professionals don’t routinely make bad decisions has some pretty historic well-established counterpoints.
“The business people know more” line is akin to saying “This used car dealer must know more about the vehicles on his lot than I do, so I can trust him”.
Sure, professionals make bad decisions. Usually they’re more complex than they seem on the surface, but there are exceptions. Sure, you can put the work in to out-knowledge them. Doubt anyone here is interested enough to do that, but the internet is a big place.
Regardless, it should be fairly obvious that giving a company you hate money will not cause them to fail faster. We can quibble over the exact mechanism, but the overall point stands.
Regardless, it should be fairly obvious that giving a company you hate money will not cause them to fail faster.
I’ll concede that trying to soak Altman for $14k/mo when he’s already hemorrhaging billions is a bit like pissing in the river.
I might ask what you plan to do with the $14k in tokens you’re burning. If you’ve got a material use case for them, and Altman wants to sell you $20 for a nickel, go wild.
But half the joke of AI is that you’re burning tokens to do nothing. That’s why businesses recoil as soon as they’re asked to justify at-cost AI spend.
“every little bit helps” said the old woman as she pissed in the sea . . .
I think companies these days are more about valuation (how much people think they are worth) vs profit (what they actually earn). AI companies are loss leaders, yet vcs still fund them anyways. Paying them more money will just add to hype and valuation (eg “our XX service grew YY% which projects to ZZ potential profit”)
The only way to stop them is give them more money.
Bailout in 3…2…1…
I sincerely hope not. Yet… quite a few things that can’t happen have been happening.
I see a lot of people in this thread stating and insisting that people should give them more money, which fells so surreal. I guess people’s mind have been shaped into consumerism to such a degree that they can’t think about a solution to things that doesn’t involve buying something anymore. It’s so hard to believe
I agree with you that nobody here should purchase a subscription with any of these companies, but I will watch happily from the sidelines while AI fanatics engage in this exact behavior, jumping from loss leader to loss leader.
Despite the popular fantasy, the rich and powerful are not stupid.
Hubris is what the rich and powerful suffer from, not stupidity. And hubris makes the same blind decisions as stupidity.
Right on point
Any chance of a bunch of used gpus getting sold off from this?
No, they’re going to use the data centers for surveillance
Unfortunately they would broadly be systems that need about 15kw, and as part of a board that won’t work as discrete parts.
So you get it, but you’ll need a couple of 60 amp circuits to dedicate to it… Also you have no viable video out
Might be like the AMD BC-250 discarded from crypto. Hopefully! https://bc250.info/
I hope so
I was hoping the same, but have since been told by several people that know more about it than I do that they are useless for gaming.
I wouldn’t say entirely useless. They just aren’t plug and play replacements.
I hope you’re right.
Aren’t they using low accuracy FP units that aren’t suited for gaming anyway?
Getting those GPUs would be like getting a beat up horse. It’s still a horse, just not much of a use anymore
A friend of mine was a big crypto miner but he was kinda crazy. He died young and I helped his remote family process his estate. They let me take his computer equipment. I got a dozen tired GPUs but my dad has been running his 4k monitor on one of those old 1080tis for about six years now and it’s still doing its thing. No one has any info on his crypto accounts, all of that is just lost for now.
I still has some use, it’s just that it’s not as good but still useful for people who want to save money and gaming pc builds
OpenAI isn’t running ChatGPT on RTX 5090’s, they use data centre hardware like the nVidia NVL72, which are entirely useless for anyone else. You wouldn’t even be able to boot it as it uses more power while idling than a residential home has access to, and up to 150kW at full load.
up to 150kW at full load.
That’s the last generation. They’re moving from Blackwell to Rubin chips now, and the 72-GPU Rubin servers use up to 230 kW.
The typical residential connection in the U.S. has a 24 to 48 kW electrical connection. A block of houses might not have enough power infrastructure to power just one of these server racks.
Those GPUs will be about as useful as a bitcoin miner for gaming. As in exactly not useful.
They may be really useful for running your own local LLM, as long as you don’t mind the hefty power bill and jet engine noise.
LLM coops might have a big future
How can I help speed this up?
Use very non-cachable tokens without paying them a penny.
Use something like repomix to do maximum damage.
Tokenmaxxing. They lo
ose more money, especially on the subsidized plans.Nice try OpenAI
More like nice try Nvidia.
Can you tight money?
It certainly appears to be escaping them.
Nice
Rubber band
I sold all my funds today. Gonna hold on to my cash until this bubble bursts.
Doesn’t matter. The regime got what they wanted out of this. The data centers are up, the tech is there, they will just snap it up cheap for use in surveillance and fabricating evidence of dissenters.
The datacenters largely aren’t built yet, as someone else pointed out. That doesn’t even matter though, to your point.
The Epstein class has successfully destroyed large portions of the Internet through bot traffic. They’ve scraped virtually all human contributions and stolen it, while ruining traditional vehicles for information gathering. They’ve eviscerated consumer hardware, and thus shifted control of compute away from the masses. They’ve successfully manufactured consent for mass surveillance including harvesting our biometric data.
Once the AI bubble bursts, it will be one of the largest transfers of wealth in history as they force us to bail out this fradulent industry. If it doesn’t throw us into another great depression, the damage it will do will ensure that things never go back to how they were pre-AI. Once that reality becomes apparent to the masses, they’ll be primed and ready for Peter Theil’s vision of “Freedom Cities”
deleted by creator
The data centres are far from up. Many of them look to have a few steel beams in place and that’s it. Others are sitting empty due to lack of hardware or lack of power.
How can we make that sooner?
use their cheapest plan, burn their tokens, burn the hole in their budget. could backfire though as then “clever analysts” will claim that demand is up and eager bankers will shell out more cash
Why burn tokens when datacenters are much more flammable
Start with the gas turbines
That would definitely backfire. The best approach against any corporation is not to use them and let their name be forgotten, therefore, the shares losing value and becoming less and less attractive to investors
Or educate the people around you that “AI” is not the magical fairy dust machine that can do anything imaginable. Might be better than giving them any money at all.
educating people doesnt work very often. people do not give a shit about what’s going on inside or behind of their glowing rectangle machine.
The people actively using AI are not an issue of lacking education on how bad it is. Just a quick example is of an upper management asshole who absolutely “loves” AI. Reality is they shit out slop but their direct reports undo the damage to protect their jobs. I know of more than a few developers in a tough spot where they are credit card slaves so work invisible overtime to compensate. They did this to themselves and are trapped in AI hell.
Interesting perspective. Software development works different where I come from, the dev part is still very much in control of the developers themselves. However the management lives in delusionville and the expectations are pretty much insane compared to the reality of the actual turnout. My comment above was more about educating the general public… AI results can look pretty compelling unless you decide to have a closer look, and a lot of non-dev people are falling for it. Either because they are dumb and gullible, lack analytic thinking or because they have no real contact with AI and are just exposed to the hype through the media.
it’s one of those things that people need to ask about things they are an expert at so they can understand how valuable the results really are.
Adjacent comment: Using the electrician analogy, AI is like one of those really cool gadgets you see on Temu that don’t actually do half of what they claim and will probably burn the building down. Another analogy is AI are like Roomba’s: they kinda work, take forever to finish, clog up easily, and are guaranteed to miss a lot of stuff.
An air conditioning device that needs no pipe to the outside you say? It defeats the laws of thermodynamics for only 99€? Shut up and take my money!
/s
Oh I like that but you might scare the MBA’s using techno babble like “thermodynamics” :)
I was a software consultant with “architect”* experience for the last 10 years of my career or whatever you want to call it. 50~80% of my job was basically saying the same thing their in house developers were saying. Maybe the other half was pushing tech stack upgrades (CVS -> SVN -> Git/Perforce ), (CGI to basically anything else), etc etc. My least favorite role was being a hatchet man, eg one of the Bobs from office space.
Professionally I used a shit ton of analogies and metaphors. Absolute most effective was comparing new feature development to an electrician adding a new light or receptacle. You may find you need to upgrade the service panel (database or other services), it can take time to pull new lines and doing so can interfere with existing equipment. Finally you can only pull so many new cables through an existing building before you need to do necessary cleanups and rearrangements (eg refactoring). Failing to do so may lead to brown outs (crashes) or the entire building catching on fire (eg Microsoft Dumpster Fire 11). Last bit is you can help explain the complexity of a feature as top floor, mid level, or basement (eg “soonish”).
* Architect title/role was something I would try my best to bury. The companies that needed an Architect only figure that out when they discover MS Access DB isn’t going to work /s but only a little bit. Also what the fuck is an “Architect”, its not like any of our titles have any national standards.
This video is kind of triggering my deep seated hatred of MBA’s but if you ever want to explain to the normies what your job is like, “The Expert” https://youtu.be/BKorP55Aqvg is perfect.
Yeah, I can relate. I’ve been doing consultant work and I always tried to avoid being pushed into the “architect” role. My background for over 25 years was software development and we had a lot of success with agile methods (doing it right is hard but viable and it produces quality software) My experience is that a good dev team does not need an “architect” to tells them what’s best. But all of this is now gone anyway, or at least taking an extended break. At the moment no one is investing in development teams, and the prospect of being able to fire all the developers because AI can do their job now is making CEOs giddy everywhere. Not going to happen (and this should be obvious for anyone who can judge the quality of code or the effectiveness of processes in terms of reliability, quality, cost, performance etc.) but that doesn’t stop them from trying.
I framed the “AI” craze as parallel to shelf checkout kiosks. They were sold as the future and a way of getting rid of those pesky human workers. Reality is they’re an open wound on the company. Unfortunately it will cost more money to get rid of them so they’re still there.
That’s the difference with AI currently. Cancel your subscription, toggle it to off in your IDE, and its gone. I believe this is why they’re trying to push “AI” everywhere, hoping it will stick somewhere.
Otherwise I liked a well manged agile development process. Heck of a lot less stressful than water fall.
The most expensive plan gets you more tokens per unit of currency actually (10x cost for 20x usage), but it’s pretty expensive and there’s not actual guarantee that they’re still losing money on your subscription in 2026 and as you pointed out, being able to show demand and MRR will get them more loans.
Get a sniper rifle and shoot their generators.
Nah. They lose money every time you use their shitty services. Sabotage would actually improve their cashflow.
Look to your superannuation plan. Most providers have a conservative plan that’s little or no shares. If lots of people transfer the message will be loud and clear. At that point the markets will dump AI and things will eventually normalize. I suspect this is already where the elite have their money, given the present warnings.
Nah.
The more people divest the more appealing these investments are.
So more AI losses per investor. Shares are just like card collecting it only goes up if the demand is increasing. Right now I suspect it’s reached maximum insanity and is ripe for a correction.
That’s not true.
It can feel that way when you think as shares as numbers on a computer but they represent a share in the ownership of a country and presumably that ownership is actually worth something.
If no one wants to invest because of the vibe, then you can buy the shares for a bargain.
Maybe it’s a bit like buying a house where someone was murdered. If you don’t care about the vibe then the reduced demand means you can get a bargain.
You can argue the shares are grossly overvalued, and that may be true, but my point is that shares have an intrinsic value and if demand reduces it increases the appeal to other investors.
I’m sure the big players are betting Trump will bailout AI companies. They don’t have to worry. So they keep pumping the share prices.
Only by using a significant amount of power and water
Oh boy, I can’t wait for my tax dollars to go to bailing them out instead of food and healthcare
Don’t worry, we can’t bail them out this time. There’s just not enough money, each bailout is exponentially bigger than the last one and this time the bubble is bigger than the rest of the global economy
We’ll probably destroy the global economy buying them just a few more months anyways though
Also, and the point that everyone here is missing, bailouts have an end point.
Giving them tax payer’s money still won’t make them profitable after the VC money goes away.
It’s also arguably the only thing propping up the American economy right now. They don’t have anything to bail with, if the AI bubbles goes on fire. Their economy may well come tumbling down in short order.
I don’t think you even have to argue it. If you move the top 7 from the us economy, the US has been in recession for about a year I think.
pretty sure as soon as the strategic reserve is at minimum levels the gas prices will pop the economy just like in 08, looking at fuel prices, there is some consensus that the derivatives bubble and the economy was accelerated or contributed by the big spike then too, for what its worth here is a snippet from a longer conversation with claude the other day about the timing and effects…
“The timing is on your side. Oil peaked around $147 in July 2008, but Lehman didn’t collapse until September 15, and the bulk of the crash to the $30s happened over September–December, right on top of the acute credit panic. So the dominant driver of that specific collapse was the financial crisis — a credit freeze, a global trade contraction, forced deleveraging, and a stampede out of commodity speculation — not primarily consumers and firms conserving because gasoline got expensive. Presenting $147→$30s as a clean “high price destroyed demand” story conflates a financial/credit event with a price-response event, exactly as you say. Fair hit. The honest nuance is that they’re entangled rather than fully separable. James Hamilton — probably the leading economist on oil-and-macro — argued in a 2009 Brookings paper that the oil spike itself was a meaningful contributor to the recession, not just a bystander: US miles driven and gasoline demand had already rolled over in late 2007 and early 2008, before Lehman, and the auto-heavy parts of the economy were buckling under fuel costs first. His stronger claim was that the oil shock alone might have produced a recession even without the financial crisis. That’s a contested, minority-leaning view — the mainstream reading is still that the financial crisis dominated — but it means high oil wasn’t innocent; it was one of the stressors loading an already over-levered system. So the two didn’t just coincide, they reinforced each other. And here’s the deeper point your question exposes, which is worth more than the correction itself: it’s genuinely hard to find a clean example of price-alone demand destruction, because oil spikes and recessions almost always travel together. Spikes help cause recessions, and recessions crush oil demand, so they arrive as a package — you rarely get to observe the price-conservation channel in isolation. That entanglement is real, and I was papering over it. The cleaner illustration of the structural piece — the permanent kind of demand destruction — is the aftermath of the 1970s shocks. Global and especially US oil demand fell durably through the early 1980s and didn’t recover for years: fuel economy standards, switching oil out of power generation and home heating, industrial efficiency. That’s the sliver that sticks even after the economy recovers, and it’s isolatable precisely because it persisted past the recovery — though even there the Volcker recession is a confounder, so it’s not perfectly pure either. So let me refine the claim rather than abandon it. 2008 is a fine illustration that a demand collapse crashes the oil price, but a poor illustration that the high price alone caused the collapse. My underlying point — that $150–200 oil is self-limiting — still holds, but the mechanism is better stated as: high oil prices help trigger or deepen a recession, and/or a coincident recession does the demand-crushing, and it’s that demand collapse (from whatever mix of causes) that breaks the price. Pure price-induced conservation is the slower, structural component I described last turn, not the fast circuit-breaker. The circuit-breaker is the recession — which, as you’re implying, may have its own separate ignition source and just happens to also torch oil demand on the way down.”
Conversations with LLMs are absolutely worthless as a source of knowledge.
Ah right, they’re “too big to fail”.
didnt the us gov already get like 5% of the company, laying the groundwork of they cant fail bullshit ?
Better start preparing to grind the economy to a halt when they try it. This time any occupy Wall Street movements should be heavily armed and wearing plate carriers
Maybe Americans are finally going to use their second amendment for the intended purpose?
We can only hope. But the left wing of the working class needs to wake up and realize they have that right too; and get armed if they are not already.
Come on, burn faster!
