OpenAI is losing money on ChatGPT Pro subscription plan, CEO Sam Altman says

OpenAI is grappling with an unexpected financial challenge: its ChatGPT Pro subscription, priced at $200 per month, is losing money. The subscription’s popularity has driven usage beyond initial projections, leading to operational costs that exceed revenue.

In a late-night post on X, OpenAI CEO Sam Altman himself shed light on the issue, saying:

“Insane thing: we are currently losing money on OpenAI pro subscriptions! people use it much more than we expected.”

insane thing: we are currently losing money on openai pro subscriptions!

people use it much more than we expected.

— Sam Altman (@sama) January 6, 2025

This candid admission confirms earlier reports about OpenAI’s rapid cash burn. The company, which faced a potential $5 billion loss in 2024, could exhaust its cash reserves within the next year if the trend continues. A recent report from The New York Times suggested price hikes may be on the horizon to address these challenges.

OpenAI’s Pro Subscription Dilemma: High Usage, High Losses

Currently, around 10 million users pay $20 monthly for ChatGPT. Internal documents indicate a planned increase to $22 by year’s end, with a potential jump to $44 within five years. OpenAI’s technology also supports over a million developers integrating its tools into their platforms.

Despite being one of the fastest-growing companies in history—achieving a $29 billion valuation just months after launching ChatGPT in November 2022—the startup’s financial sustainability is under scrutiny. Operating a generative AI system like ChatGPT comes with immense costs, making it one of the most expensive services to maintain.

According to a report by The Information, OpenAI’s annual costs for AI training and inference could hit $7 billion this year, with staffing expenses potentially reaching $1.5 billion. This financial strain could result in a $5 billion loss for 2023, leaving the company in urgent need of funding to avoid running out of cash.

“The ChatGPT maker could lose as much as $5 billion this year, according to an analysis by The Information, based on previously undisclosed internal financial data and people involved in the business. If we’re right, OpenAI, most recently valued at $80 billion, will need to raise more cash in the next 12 months or so,” the report stated.

To mitigate these pressures, OpenAI is reportedly seeking $7 billion in funding from international investors, including the UAE. These funds would likely support scaling efforts, including investments in AI hardware and infrastructure.

Despite these challenges, OpenAI remains optimistic about its future. The company projects revenue will climb to $100 billion by 2029, placing it among global giants like Nestlé and Target. Usage of OpenAI’s services has also soared, with 350 million monthly users in June, up from 100 million just three months prior.

This revelation follows recent analyst warnings highlighting that Big Tech firms must generate $600 billion in annual revenue to support their hefty investments in AI hardware.

Founded in 2015 by Sam Altman and Elon Musk as a nonprofit, OpenAI transitioned to a commercial model in 2020. This shift, paired with the success of ChatGPT, has positioned the company as a leader in the AI space. However, maintaining this momentum while addressing escalating costs remains a formidable challenge.

The company’s future hinges on balancing its growing popularity with financial sustainability—a challenge that will likely shape its trajectory in the years ahead.