Category: Economy
CRASH: If OpenAI’s huge losses sink the company, is our economy next?
ChatGPT has dominated the AI space, bringing the first generative AI platform to market and earning the lion’s share of users that grows every month. However, despite its popularity and huge investments from partners like Microsoft, SoftBank, NVIDIA, and many more, its parent company, OpenAI, is bleeding money faster than it can make it, begging the question: What happens to the generative AI market when its pioneering leader bursts into flames?
A brief history of LLMs
OpenAI essentially kicked off the AI race as we know it. Launching three years ago on November 30, 2022, ChatGPT introduced the world to the power of large language models LLMs and generative AI, completely uncontested. There was nothing else like it.
OpenAI lost $11.5 billion in the last quarter and needs $207 billion to stay afloat.
At the time, Google’s DeepMind lab was still testing its Language Model for Dialogue Applications. You might even remember a story from early 2022 about Google engineer Blake Lemoine, who claimed that Google’s AI was so smart that it had a soul. He was later fired from Google for his comments, but the model he referenced was the same one that became Google Bard, which then became Gemini.
As for the other top names in the generative AI race, Meta launched Llama in February 2023, Anthropic introduced the world to Claude in March 2023, Elon Musk’s Grok hit the scene in November 2023, and there are many more beneath them.
Needless to say, OpenAI had a huge head start, becoming the market leader overnight and holding that position for months before the first competitor came along. On a competitive level, all major platforms have generally caught up to each other, but ChatGPT still leads with 800 million weekly active users, followed by Meta with one billion monthly active users, Gemini at 650 million monthly active users, Grok at 30.1 million monthly active users, and Claude with 30 million monthly active users.
Financial turmoil for OpenAI
Just because ChatGPT is the leading generative AI platform does not mean the company is in good shape. According to a November earnings report from Microsoft — a major early backer of OpenAI — the AI juggernaut lost $11.5 billion in the last quarter alone. To make matters even worse, a new report suggests that OpenAI has no path to profitability until at least 2030 or later, and it needs to raise $207 billion in the interim to stay afloat.
By all accounts, OpenAI is in serious financial trouble. It is bleeding money faster than it makes it, and unless something changes, the generative AI pioneer could be on the verge of a complete collapse. That is, unless one of these Hail Marys can save the company.
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Photo By David Zorrakino/Europa Press via Getty Images
The bid to save OpenAI
OpenAI is currently looking into several potential revenue streams to turn its financial woes around. There’s no telling which ones will pan out quite yet, but these are the options we know so far:
For-profit restructure
When OpenAI first emerged, it was a nonprofit company with the goal to improve humanity through generative AI. Fast-forward to October 2025 — OpenAI is now a for-profit organization with a separate nonprofit group called the OpenAI Foundation. While the move will allow OpenAI’s profit arm to increase its earning potential and raise vital capital, it also received a fair share of criticism, especially from Elon Musk, who filed a lawsuit against OpenAI for reneging on its original promise.
A record-breaking IPO
Another big perk of its new for-profit restructure, OpenAI now has the power to go public on the stock market. According to an exclusive report published by Reuters in late October, OpenAI is putting the puzzle pieces together for a record-breaking IPO that could be worth up to $1 trillion. Not only would the move make OpenAI a publicly traded company with stock options, it would also give it more access to capital and acquisitions to further bolster its products, services, and economic stability.
Ad monetization
Online ads are the lifeblood of many online websites and services, from Google to social media apps like Facebook to mainstream media and more. While AI platforms have largely stayed away from injecting ads into their results, OpenAI CEO Sam Altman recently said that he’s “open to accepting a transaction fee” for certain queries.
In his ideal ad model, OpenAI could potentially take a cut of any products or services that users look for and buy through ChatGPT. This structure is different from how Google operates, by letting companies pay to bring their products to the top of search results, even if the products they sell are poorly made. Altman believes that his structure is better for users and would foster greater trust in ChatGPT.
Government projects and deals
While Altman recently denied that he’s seeking a government bailout for OpenAI’s financial troubles, the company can still benefit from government deals and projects, the most recent one being Stargate. As a new initiative backed by some of the biggest players in the AI space, Stargate will give OpenAI access to greater computing power, training resources, and owned infrastructure to lower expenses and increase the speed of innovation as they work on future AI models.
If OpenAI fails …
While OpenAI has several monetization options on the table — and perhaps even more that we don’t know about yet — none of them are a magic bullet that’s guaranteed to work. The company could still collapse, which brings us to our question at the top of the article: What happens to the generative AI market if OpenAI fails?
In a world where OpenAI fizzles entirely, there are several other platforms that will likely fill the void. Google is the top contender, thanks to the huge progress it made with Gemini 3, but Meta, xAI, Anthropic, Perplexity, and more will all want a piece.
That said, OpenAI isn’t the only AI platform struggling to make money. According to Harvard Business Review, the AI business model simply isn’t profitable, largely due to high maintenance costs, huge salaries for top AI talent, and a low-paying subscriber base. In order to keep the generative AI dream alive, companies will need a consistent flow of capital, a resource that’s more accessible for established companies with diverse product portfolios — like Google and Meta — while the new companies that only build LLMs (OpenAI and Claude) will continue to struggle.
At this stage in the AI race, there’s no doubt in my mind that the whole generative AI market is a big bubble waiting to burst. At the same time, AI products have been so fervently foisted on society that it all feels too big to fail. With huge initiatives like Stargate poised to beat China and other foreign nations to artificial general intelligence AGI, the AI race will continue, even if OpenAI no longer leads the charge. If I were a betting man, though, I would guess that someone important finds a way to keep Sam Altman’s brain child afloat one way or another, even as all signs point toward OpenAI spending itself out of business.
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