Hard Fork AI OpenAI Losing Money on Every Query Due to Microsoft Hosting
Nov 18, 2025
Discover the financial struggles behind AI as leaked documents reveal OpenAI's costly user interactions that exceed earnings. Learn about Microsoft's substantial revenue share from these payments and the implications for both companies. Dive into complexities of revenue estimates and the rising costs of AI infrastructure. The discussion includes concerns about an unsustainable AI bubble with major players operating at a loss. Tune in for insights on the evolving landscape of AI compute providers and partnerships.
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Microsoft Revenue Share Revealed
- Leaked documents show OpenAI paid Microsoft hundreds of millions in revenue share and compute-related payments.
- The payments reflect a 20% revenue-share tied to Microsoft's large early investment in OpenAI.
Money Flows Are Two-Way And Opaque
- Microsoft also shares revenue back to OpenAI for Bing and Azure OpenAI integrations, complicating net flows.
- Public financial statements do not break out these amounts, so leaked internal figures matter for estimates.
Inference Costs Are Eye-Watering
- OpenAI's inference (serving) costs are extremely large and rising rapidly, per the leak.
- Reports suggest inference spend rose from ~$3.8B in 2024 to $8.65B in the first nine months of this year.