No… The worst year Amazon ever had was a net loss of $1.4 Billion back in 2000. Most years in the early days they were at a loss of a few dozen million. At the time, they drew a lot of criticism for running red way longer. If Amazon ran at their worst year for 50 years, they still would have lost less money than Anthropic did.

They haven’t operated at a loss in over a decade.

But, when the word guessing program gains consciousness, it will be capable of doing the job of every worker in the world, and eager to do those jobs, and anybody who owns Anthropic shares will be a trillionaire in an economy that totally works and is healthy. So, better invest now!

Assuming your assessment of AI utility is correct for sake of discussion, it would not mean it is guaranteed to be profitable for any given company with any given strategy and spending.

Internet shopping and delivery is hugely profitable, but that’s of little comfort to pets.com and webvan.

If a company more responsibly managed their spend and commitments and still reached the same utility as Anthropic, then Anthropic would never see profitability.

It will definitely be profitable for the hardware makers. Companies whose entire value proposition depends on the model weights not leaking in an increasingly sloppy vulnerability-filled world of IT? Not so much.

In the long run you’d imagine that GPUs will become more affordable once these massive datacenters have been built. At that point it becomes far more profitable to run your own hardware. Especially if these AI companies need to increase their subscription prices by x10 to finance all this debt they’ve taken on.

Yeah AI is here to stay but these “founder” companies sure aren’t.

Public libraries are also very useful. Doesn’t mean they have to make money.

Got a local food truck epidemic of mid overpriced food and no food safety standards, in my college town it was great, back home makes me wish they regulated more

Cuz they got churros.

Repaying debt is cash cost. But this is convertible debt that could be converted to stock, in which case the holders of those newly converted shares don’t get paid cash from the company, but instead own a chunk of the company worth more than that cash. So the conversion itself would alleviate the cash demands of the company, while also diluting the ownership stakes of any preexisting owner. That’s what that paragraph means.

Companies issue convertible bonds usually because they can get better interest rates on it, in the event that they need to repay it. Or they’re happy to deal with diluting their shares if the company becomes so valuable, because that means they’ve gotten a lot richer and just have to share their newfound riches with the lender.

included a $72 billion accounting charge reflecting an increase in the ⁠estimated value of bonds that could eventually convert into Anthropic shares, rather than cash costs tied to ​its operations

It’s a very common way for startups to raise money. In this case, the bond value goes up because of a perceived increase in the value of Anthropic.

They have.

1. Wait for excited CEOs to fire all their staff.

2. Crank up the prices.

The RAM cartel is figuring out a new excuse for a price hike before allowing it.