The revenue to spending gap is whats most concerning here. When OpenAI is pulling in $13 billion but burning throught capital at that rate, the fundamentls start looking shakey. Real adoption has to scale faster than infrastructure costs, or the whole investment thesis unravels. The Nvidia order backlog is reassuring, but it still doesnt close that profitability gap in the near term.
Such an insightful take. I very much agree with you here, and I think the best way to conceptualize this market is that there are "good" players and "bad" players. Anthropic, for instance, is much more of a "good" player than OpenAI, as it has a much more solid structure for a growth path to profitability. However, when OpenAI is the one making deals that cause multi-billion-dollar companies like AMD and Oracle to jump 20-40% in a single day, it creates dependency, and such exuberance warrants caution.
The revenue to spending gap is whats most concerning here. When OpenAI is pulling in $13 billion but burning throught capital at that rate, the fundamentls start looking shakey. Real adoption has to scale faster than infrastructure costs, or the whole investment thesis unravels. The Nvidia order backlog is reassuring, but it still doesnt close that profitability gap in the near term.
Such an insightful take. I very much agree with you here, and I think the best way to conceptualize this market is that there are "good" players and "bad" players. Anthropic, for instance, is much more of a "good" player than OpenAI, as it has a much more solid structure for a growth path to profitability. However, when OpenAI is the one making deals that cause multi-billion-dollar companies like AMD and Oracle to jump 20-40% in a single day, it creates dependency, and such exuberance warrants caution.