Artificial intelligence startup OpenAI is expecting massive losses this year, but revenue will continue to explode over the next five years as the company increases fees for its signature chatbot.
Accordingly Documents seen by the New York TimesThe company expects revenue of $3.7 billion in 2024. ChatGPT, which launched in 2022 and kicked off the current generative AI frenzy, is expected to generate $2.7 billion this year, while $1 billion will come from other companies.
But OpenAI sees a $5 billion loss, which doesn’t include stock-based compensation Just said. The biggest cost factor is the computing power it receives from the partner and top investor Microsoftwhose cloud services host OpenAI’s products.
The losses came despite monthly revenue reaching $300 million in August, up 1,700% since the start of 2023, the report added. Growth will continue to accelerate, with OpenAI predicting revenue will more than triple to $11.6 billion in 2025 and eventually reach $100 billion in 2029.
Part of the future revenue increases would come from an increase in the fee ChatGPT users pay. According to the JustIt will rise from $20 today to $22 per month by the end of the year and then rise to $44 over the next five years.
OpenAI declined to comment Just and didn’t respond immediately Fortune’s Please comment. CNBC confirmed separately the annual sales and loss forecasts.
The from Just have been shown to potential OpenAI investors as the startup seeks to raise $7 billion in a fundraising round that could value the company at $150 billion.
OpenAI has reportedly been in talks with Microsoft and other tech giants Apple And Nvidia for the financing round, which is expected to close next week.
VC firm Thrive Capital is the lead investor, Tiger Global Management and UAE-backed MGX are also in talks.
But sources said so Wall Street Journal that Apple is no longer in discussions about participating in the fundraising campaign. Apple did not immediately respond to a request for comment.
In the meantime, OpenAI is preparing announce a new structure As a result, the for-profit arm of the company will no longer be subject to the board of directors of its charitable foundation.
The sudden Resignation of Chief Technology Officer Mira Murati that was on Wednesday recent leadership departure This signals the impending change of OpenAI in the wake of 2023 attempt to oust CEO Sam Altman.
Sources reported that this is in the midst of its transition to a for-profit company Bloomberg that OpenAI could grant Altman one 7% equity share in the companywhich could potentially result in a $10 billion wealth increase for the 39-year-old CEO. But the company denied the report.
“The board discussed whether it would be beneficial to the company and our mission if Sam were compensated with equity, but no specific numbers were discussed or decisions were made,” said Bret Taylor, chairman of OpenAI Assets on Friday.
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