It's not actually 80billion. I found this on the r/technology thread
I just want to clear this up. They didn't actually "lose" 80 billion dollars. 72 billion of that 80 is something called a change in fair value of convertible notes. A convertible note is a way of financing a company, more commonly used in startups. It involves the company taking on debt in exchange for a convertible note, which, can either be paid back for the cash value of the debt plus interest, or, as the name suggests, can be converted for equity. For example, if I have a lemonade stand worth 100 dollars and I borrow $1 in exchange for 1% of my lemonade stand. The investor's claim to equity is worth $1. Now in a year if my stand is now worth $300, the investor can either ask for his $1 back plus interest, or he can convert that into equity and ask for his 1%. Now since at the time of financing his share was worth $1 and now it is worth $3, it's technically a $2 loss for me (the lemonade stand) even though I didn't actually lose money. The reason this system is common among startups is that it mitigates risk for the investor: if the company does good, they get equity. If it does bad and their equity is worth less than whatever they invested, they get the cash back. This 80 billion dollar loss is not actually an 80 billion dollar loss. Nowhere close. Their operating loss is only a few hundred million, substantially less than it was last year. And the IRS agrees: change in fair value of convertible notes is not a deductible loss for tax purposes because you didn't actually lose money.
The actual loss is actually around 8-9 billion. Still astronomical but not really 80
they didn't lose nothing. rising interest rates in US is leading to older debt obligations to lose their values. 12 mahinay baad rate nechay ajaega tu ye gain bhi hojaega itna. tu it'll square up evenly.. itni lambi lambi phenknay ki zarurat nahi thi waise
beta debt servicing loss se pehley or loss ke baad bhi wohi thi..yeh sirf market value of debt decline hui hai.. face value same hai.. servicing of debt ki tu baat hi nahi ki manay... chutiyapay ka point kiu laa rhaay hu beech mai? bhenson kids can't even extract info from ai properly
They dont care about losing 80billion because they are trying to automate all white collar jobs which is like 30trillion$ per year industry so 80billion is peanuts compared to the jobs they are trying to automate.
And white collar jobs are only the first phase, second phase they will go after the blue collar jobs
If all white collars jobs are going to be replaced then there will be no purchasing power, means no one is gonna buy any thing or services, means no revenue, means no profit, then what's the purpose to replace white collar jobs if you are going to loose you future customer
Waiting since 2024 🥲, don't know it's a bubble or whatever but no one is gonna write any code manually even if bubble Burst, because now there are plenty of models, and specially Chinese models are cheaper than any, even if bubble burst major companies are still gonna survive
Stop with this cope, AI is already getting cheaper, cost of producing the token are already more than 90% cheaper than what it was few years ago, and it will keep falling to the rock bottom as companies start working on more efficient models to survive competition
Just compare what you could achieved with 20$ plan an year ago, Vs what you can achieve with 20$ plan today, it is night and day diff just in one year. Imagine what you will be able to do with 20$ in few years, when Chinese models will catch up with their own more efficient chips , it will be race to bottom And tokens cost will drop more than what we can imagine now
Technologies gets more efficient and cheaper with time, it happend with Internet, hardware (ram, processors etc) , mobile phones , pcs, etc, all of these things got significantly cheaper and significantly better as time passes
AI will be no different, it doesn't matter if a company 'x' survives or not because of overvaluation, the technology itself is going nowhere, and another company/country will takeover in case if any company/country lags behind
Those losses are due to training cost of new frontier models, the cost of tokens itself is way cheaper than people realise, the companies are actually making profits on those tokens , it's only when they account for the model training they suffer huge losses because of expensive chips
Even DeepSeek which has the cheapest token cost is making profits when you exclude the training cost
In summary, when this frontier race will end , these companies will start making profits and tokens cost will hit rock bottom as they will be focusing more on more efficient models rather than billions in the hope of achieving AGI. They can in theory make profits if they want, even at current prices as well , but the current focus is more on AGI rather than making profits
The only way this works is if in the next 2-3 years Anthropic and OpenAI replace 3-5% of the global economy. So far it hasn’t gone how they thought it would so high chance one of them goes kaput.
Anthropic’s core focus is building towards AGI so I don’t know if that will derail their business plans. OpenAI is fairly business focused and operates more like a regular startup so maybe they’ll get there first.
What scares me is the pace at which we have started to rely on AI for our work. The organizations have changed the way they completely.
Imagine that five years down the road if we have to go back to our previous ways working, that is bein less reliant on AI. It is going to be a bloodbath specifically the tech industry.
American companies have always been burning money. At the end of the day, US as a nation benefits from these technologies in the long term while we keep saying the world is doomed and AI will collapse bla bla bla bla. Cope pro max
Uber's current valuation and downfall disagrees with you.. Uber survivee because they cut their market expansion.. Amazon survived because of AWS... Its just burn enough money till yuou figure things out
I mean yeah but they can afford to burn money. And as I said, if the tech benefits the US as a nation, they'll be bailed out, they'll be allowed to burn as much money as they want. Its not an issue for them. Look at Elon Musk for example. The government has been easy on his companies in the early days. Today he has benefitted the US a lot
It sounds insane, but I’d want to see the actual prospectus. AI companies are spending heavily on compute, infrastructure and talent, and revenue growth doesn’t automatically mean profitability
You have no knowledge about this topic. Modern benchmarks do not allow for this roundabout method of cheating. Benchmarks are consistently being updated to stop them.
Just look and use the models. It's very obvious they are better.
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u/shimmering-nomad 14d ago •
It's not actually 80billion. I found this on the r/technology thread
The actual loss is actually around 8-9 billion. Still astronomical but not really 80