{"id":410555,"date":"2026-01-15T08:57:13","date_gmt":"2026-01-15T08:57:13","guid":{"rendered":"https:\/\/www.newsbeep.com\/ca\/410555\/"},"modified":"2026-01-15T08:57:13","modified_gmt":"2026-01-15T08:57:13","slug":"financial-expert-says-openai-is-on-the-verge-of-running-out-of-money","status":"publish","type":"post","link":"https:\/\/www.newsbeep.com\/ca\/410555\/","title":{"rendered":"Financial Expert Says OpenAI Is on the Verge of Running Out of Money"},"content":{"rendered":"

The AI industry continues to pour tens of billions<\/a> of dollars into resource-intensive models and the infrastructure to run them<\/a>. In the face of it all, their promises of kickstarting a technological revolution that could one day be immensely profitable remain convincing enough for investors to prop up sky-high valuations \u2014 at least for now.<\/p>\n

But actually turning a profit is likely many years away for the vast majority of AI companies, and that\u2019s if it ever comes. Who will stand to benefit from the rampant expenditures also remains a subject of heated debate, as corporations like Google, Meta, and OpenAI continue to race each other for dominance in the space.<\/p>\n

Google and Meta already have successful businesses doing other things, but OpenAI doesn\u2019t. That hasn\u2019t stopped it from committing to spend well over $1 trillion<\/a> before the end of the decade, an astronomical and extremely risky bet on scale even as its revenue lags. Users have shown a low willingness to pay for ChatGPT subscriptions<\/a>, and the company has only begun exploring other revenue-generating avenues<\/a>.<\/p>\n

It all adds up to an enormous unanswered question: how long can OpenAI keep burning cash? <\/p>\n

In a new essay for the New York Times<\/a>, Sebastian Mallaby, senior fellow at the nonpartisan think tank Council on Foreign Relations, predicts that the Sam Altman-led company could run out of money \u201cover the next 18 months.\u201d<\/p>\n

He argued that OpenAI\u2019s competitors, industry stalwarts like Google, Microsoft, and Meta, could use the money they earned from their legacy businesses to pour hundreds of billions into developing and scaling their AI models \u2014 while OpenAI doesn\u2019t have that luxury.<\/p>\n

Mallaby is no AI hater. He\u2019s extremely bullish on AI overall, arguing that \u201cbusinesses usually take decades to deploy new technologies successfully,\u201d whereas the AI industry has made \u201cstriking\u201d progress in just three years.<\/p>\n

In other words, Mallaby isn\u2019t betting against a growing AI bubble<\/a> \u2014 he\u2019s singling out his predicted winners and losers of the ongoing AI race. And despite becoming a household name after the launch of ChatGPT just over three years ago, he expects OpenAI to become a footnote in AI history less than two years from now.<\/p>\n

While OpenAI has raised record amounts of funding for a private company, the company is still \u201chemorrhaging cash,\u201d burning through more than $8 billion<\/a> in 2025 alone.<\/p>\n

\u201cEven if OpenAI reneges on many of those promises and pays for others with its overvalued shares, the company must still find daunting sums of capital,\u201d Mallaby wrote. \u201cHowever rich the eventual AI prize, the capital markets seem unlikely to deliver.\u201d<\/p>\n

After running out of cash, the researcher suggested that OpenAI could be \u201cabsorbed by Microsoft, Amazon or another cash-rich behemoth.\u201d <\/p>\n

But even with one of the biggest names in the game going under, Altman and his company will leave a lasting legacy behind, Mallaby argued.<\/p>\n

An \u201cOpenAI failure wouldn\u2019t be an indictment of AI It would be merely the end of the most hype-driven builder of it,\u201d he wrote.<\/p>\n

Many other experts agree that 2026 could be a \u201cmake-or-break year<\/a>\u201d for OpenAI as pressure on the industry continues to mount. <\/p>\n

Altman is holding onto his guns, declaring \u201ccode red<\/a>\u201d and doubling down on ChatGPT to keep up with the firm\u2019s biggest competitor, Google.<\/p>\n

\u201cThis is the WeWork story on steroids,\u201d one venture capital boss, who is invested in one of OpenAI\u2019s rivals, told The Economist<\/a> last month. The coworking space company famously collapsed like a house of cards and went bankrupt in 2023 after years of turmoil<\/a>, churning through billions of dollars by leasing and buying commercial real estate.<\/p>\n

More on OpenAI: ChatGPT Killed a Man After OpenAI Brought Back \u201cInherently Dangerous\u201d GPT-4o, Lawsuit Claims<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"The AI industry continues to pour tens of billions of dollars into resource-intensive models and the infrastructure to…\n","protected":false},"author":2,"featured_media":410556,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[20],"tags":[62,276,277,49,48,61],"class_list":{"0":"post-410555","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-artificial-intelligence","8":"tag-ai","9":"tag-artificial-intelligence","10":"tag-artificialintelligence","11":"tag-ca","12":"tag-canada","13":"tag-technology"},"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/posts\/410555","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/comments?post=410555"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/posts\/410555\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/media\/410556"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/media?parent=410555"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/categories?post=410555"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/tags?post=410555"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}