It seems they are *not* losing money on inference: https://bsky.app/profile/steveklabnik.com/post/3mdirf7tj5s2e
Because inference revenue is outpacing training cost based on OpenAI’s report and intuition.
i.e They made more money on 3.5 than 3.5 cost to train, but didn't make enough money on 3.5 to train 4.0.
This has got to be my favorite one of them all that keeps coming up in too many comments… You know who also was losing money in the beginning?! every successful company that ever existed! some like Uber were losing billions for a decade. and when was the last time you rode in a taxi? (I still do, my kid never will). not sure how old you are and if you remember “facebook will never be able to monetize on mobile…” - they all lose money, until they do not
Can you imagine if Amazon, EBay, PayPal, or Saleforce existed today?
I also remember having gone into research, because there were no jobs available, and even though I was employed at the time, our salaries weren't being paid.
Like it's a surprise that startups burn through money. I get the feeling that people really have no idea what they're talking about in here anymore.
It's a shame.
So Tomorrow when this "startup" will need to come out of their money burning phase, like every startup has to sooner or later, that cost will increase, because there is no other monetising avenue, at least not for anthropic that "wilL never use ads".
at 20k this "might" be a reasonable cost for "the project", at 200k it might not.
> Note that while the data insight provides some commentary on what factors drive these price drops, we did not explicitly model these factors. Reduced profit margins may explain some of the drops in price, but we didn’t find clear evidence for this.
I did not ask for random company that went under for any reason but specific question related to users and revenue.
Uber, which you cite as a success, is only just starting to make any money, and any original investors are very unlikely to see a return given the huge amounts ploughed in.
MicroStrategy has transformed itself, same company, same founder, similar scam 20 years later, only this time they're peddling bitcoin as the bright new future. I'm surprised they didn't move on to GAI.
Qualcomm is now selling itself as an AI first company, is it, or is it trying to ride the next bubble?
Even if GAI becomes a roaring success, the prominent companies now are unlikely to be those with lasting success.
I can guarantee you that 90% of successful businesses in the world made a profit their first year.
Companies that were not profitable in their first year: Microsoft, Google, SpaceX, airBnB, Uber, Apple, FedEx, Amazon.
If the vast majority of companies are immediately profitable, why do we have VC and investment at all? Shouldn’t the founders just start making money right aeay?
US Big Tech, US Big Tech, US Tech-adjacent, US Big Tech, US Big Tech, US Big Tech, FedEx, US Tech-adjacent.
In other words, exactly what I was getting at.
Also, a basic search shows Microsoft to have been profitable first year. I'd be very surprised if they weren't. Apple also seems to have taken less than 2 years. And unsurprisingly, these happen to be the only two among the tech companies you named that launched before 1995.
Check out the Forbes Global 5000. Then go think about the hypothetical Forbes Global 50,000. Is the 50,000th most successful company in the world not successful? Of course not, it's incredibly successful.
> why do we have VC and investment at all
Out of all companies started in 2024 I can guarantee you that <0.01% have received VC investment by now (Feb 2026) and <1% of tech companies did. I'll bet my house on it.
They are making a profit on each sale, but there are fixed costs to running a business.
Restaurants have comparatively high start up costs and ramp up time. Compare to e.g. a store selling clothes. If for successful restaurants the average time is already a year, then in general for successful businesses it's going to be less.
I'm curious - do you have ANY idea what it costs to have humans write 100,000 lines of code???
You should look it up. :)
> I'm curious - do you have ANY idea what it costs to have humans write 100,000 lines of code???
I'll bite - I can write you an unoptimised C compiler that emits assembly for $20k, and it won't be 100k lines of code (maybe 15k, the last time I did this?).
It won't take me a week, though.
I think this project is a good frame of reference and matches my experience - vibing with AI is sometimes more expensive than doing it myself, and always results in much more code than necessary.
You may be willing to sell your work at that price, but that’s not the market rate, to put it very mildly. Even 10 times that would be seriously lowballing in the realm of contract work, regardless of whether it’s “optimised” or not (most software isn’t).
It is now.
At any rate, this is my actual rate. I live in South Africa, and that's about 4 weeks of work for me, without an AI.
You must provide the entire git history with small commits.
I won't be holding my breath.
> You must provide the entire git history with small commits.
> I won't be holding my breath.
Sure; I do this often (I operate as a company because I am a contractor) - money to be held in escrow, all the usual contracts, etc.
It's a big risk for you, though - the level of performance isn't stated in the linked article so a parser in Python is probably sufficient.
TCC, which has in the past compiled bootable Linux images, was only around 15k LoC in C!
For reference, for a engraved-in-stone spec, producing a command-line program (i.e. no tech stack other than a programming language with the standard library), a coder could reasonably produce +5000LoC per week.
Adding the necessary extensions to support booting isn't much either, because the 16-bit stuff can be done just the same as CC did it - shell out to GCC (thereby not needing many of the extensions).
Are you *really* sure that a simple C compiler will cost more than 4 weeks f/time to do? It takes 4 weeks or so in C, are you really sure it will take longer if I switch to (for example) Python?
No, you'll have to match the performance of the actual code, regardless of what happens to be written in the article. It is a C compiler written in Rust.
Obviously. Your games reveal your malign intent.
EDIT: And good LORD. Who writes a C compiler in python. Do you know any other languages?!?
Look, it's clear that you don't hire s/ware developers very much - your specs are vague and open to interpretation, and it's also clear that I do get hired often, because I pointed out that your spec isn't clear.
As far as "playing games" goes, I'm not allowing you to change your single-sentence spec which, very importantly, has "must match performance", which I shall interpret to as "performance of emitted code" and not "performance of compiler".
> Your games reveal your intent.
It should be obvious to you by know that I've done this sort of thing before. The last C compiler I wrote was 95% compliant with the (at the time, new) C99 standard, and came to around 7000LoC - 8000LoC of C89.
> EDIT: And good LORD. Who writes a C compiler in python. Do you know any other languages?!?
Many. The last language I implemented (in C99) took about two weeks after hours (so, maybe 40 hours total?), was interpreted, and was a dialect of Lisp. It's probably somewhere on Github still, and that was (IIRC) only around 2000LoC.
What you appear to not know (maybe you're new to C) is that C was specifically designed for ease of implementation.
1. It was designed to be quick and easy to implement.
2. The extensions in GCC to allow building bootable Linux images are minimal, TBH.
3. The actual 16-bit emission necessary for booting was not done by CC, but by shelling out to GCC.
4. The 100kLoC does not include the tests; it used the GCC tests.
I mean, this isn't arcane and obscure knowledge, you know. You can search the net right now and find 100s of undergrad CS projects where they implement enough of C to compile many compliant existing programs.
I'm wondering; what languages did you write an implementation for? Any that you designed and then implemented?
Yes, we all took the compilers class in college. Those of us who went to college, that is.
So you are not willing to put $20k in escrow for, as per your offer:
>>>> Deal. I'll pay you IF you can achieve the same level of performance. Heck, I'll double it.
I just noticed now that you actually offered double. I will do it. This is my real name, my contact details are not hard to find.
I will do it, with emitted binaries performing as well as or better than the binaries emitted by CC.
Put your $40k into a recognised South African escrow service (I've used a few in the past, but I'd rather you choose one so you don't accuse me of being some sort of African scammer).
Because I am engaged in a 6+ hours/day gig right now, I cannot do it f/time until my current gig is completed (and they are paying me directly, not via escrow, so I am not going to jeopardise that).
I can however do a few hours each day, and collect my payment of $40k only once the kernel image boots in about the same time that the CC kernel image boots.
> Yes, we all took the compilers class in college. Those of us who went to college, that is.
If you knew that, why on earth would you assume that implementing a C compiler is at all a complex task?
You are fucking nuts.
It's amazing what you can get people to do.
Reveal myself as ... a contractor agreeing to your bid?
> It's amazing what you can get people to do.
There's a ton of money now floating around in pursuit of "proving" how cost-efficient LLM coding is.
I'm sure they can spare you the $40k to put into escrow?
After all, if I don't deliver, then the AI booster community gets a huge win - highly respected ex-FAANG staff engineer with 30 years of verified dev experience could not match the cost efficiency of Claude Code.
I am taking you up on your original offer: $40k for a C compiler that does exactly what the CCC program in the video does.
A local Fintech needing PCI work pays that, but that's not long-term contracts.
All that this is saying is that license laundering of a code-base is now $20k away through automated processes, at least if the original code base is fully available. Well, with current state-of-the-art you’ll actually end up with a code-base which is not as good as the original, but that’s it.
The rate probably goes up if you ask for more and more standards (C11, C17, C23...) but it's still a lot easier than compilers for almost any other popular language.
I see no test criteria that actually runs that built linux through various test plans, so, yeah emitting enough asm just to boot is doable.
That level of quality should be sufficient.
Do you know any low quality programmers that write C compilers in rust THAT CAN BUILD LINUX?
No you don't. They do not exist.
Also, the booting part, as stated some times, is discutable.
Huh. Interesting. Like the other guy pointed out, compiler classes often get students to write toy C compilers. I think a lot of students don't understand the meaning of the word "toy". I think this thread is FULL of people like that.
Lots of segfaults, too.
So, things you don't think I or my coursemates could do include writing a C compiler that builds a Linux kernel.
What else do you think we couldn't do? I ask because there are various projects I'll probably get to at some point.
Things on that list include (a) writing an OS microkernel and some of the other components of an OS. Don't know how far I'll take it, but certainly a working microkernel for one machine, if I have time I'll build most of the stack up to a window manager. (b) implementing an LLM training and inference stack. I don't know how close to the metal I'd go, I've done some low level CUDA a long time ago when it was very new and low-level, depends on time. I'll probably start the LLM stuff pretty soon as I'm keen to learn.
Are these also impossible? What other things would you add to the impossible list?
Amiga OS is basically a microkernel and that was built 40 years ago. There are also many other examples, like Minix. Do I think most people could build a full microkernel based mini Unix? No. But they could get “something” working that would qualify as an OS.
On the other hand, there are not many C compilers that build Linux. There are many implementations of C compilers, however. The goal of “build Linux” is much more specific.
So what other projects are impossible? That was my question.
Doing a real compiler to be used by humans is difficult. Doing a compiler that “gets the thing done” is a different thing.
I think you might be thinking of C++
I also should’ve qualified my message with “in 2 weeks”, or even “in 2 months.” Given more time it’s obviously possible for more people.
You can give a developer the GCC test suite and have them build the compiler backwards, which is how this was done. They literally brute forced it, most developers can brute force. It also literally uses GCC in the background... Maybe try reading the article.
You take care now.
The people in here have gone entirely nuts.
If you didn’t care about copying code, usefulness, or correctness you could probably get a human to whip you up a C compiler for a lot less than $20k.
And it's really expensive, despite your suspicions.
We figured out that LOC was a useless productivity metric in the 80s.
Microsoft paid my company a lot of money to write code. And in the end you were able to count it, and the LOC is a perfectly fine metric which is still used today to measure complexity of a project.
If you actually work in software you know this.
I have no idea what point you're trying to make - but I've grown very tired of all the trolls attacking me. Good night.
EDIT: OH. Maybe you mean that people don't cite LOC in contract deliverables. Yeah, I know. I never said that, and it's irrelevant to my point.
LIKE THE WHOLE WORLD DOES.
But hey, maybe it's just the extremely high profile projects I've worked on.
But I can write a 100k LOC compiler where 90k lines are for making error messages look pixel perfect on 10 different operating systems. Or where 90k lines are useless layers upon layers of indirection. That doesn’t mean that someone is willing to pay more for it.
AI frequently does exactly that kind of thing.
So saying my AI made a 100k LOC program that does X, and then comparing the cost to a 100k LOC program written by a human is a nonsense comparison. The only thing that matters is to compare it to how much a company would pay a human to produce a program capable of the same output.
In this case the program is commercially useless. Literally of zero monetary value, so no company would pay any money for it. Therefore there’s nothing to compare it to.
That’s not to say it’s not an interesting and useful experiment. Or that things can’t be different in the future.
As a seasoned manager, I have an idea how long a feature should take, both in implementing effort and longness of code. I hace to know it, is my everyday work.
"I'm curious - do you have ANY idea what it costs to have humans write 100,000 lines of code???"
which any reasonable reading would take to mean "paid-by-line", which we all know doesn't happen. Otherwise, I could type out 30,000 lines of gibberish and take my fat paycheck.
Nope. Try again.
For a human, writing 100k LOC to do something that might only really need 15k would be a bit surprising and unexpected - a human would probably reconsider what they were doing well before they typed 100k LOC. Where-as, an AI doesn't necessarily have that concern - it can just keep generating code and doesn't care how long it will take so it doesn't have the same practical pressure to produce concise code.
The result is that while for large enough human-written programs there's probably an average "density" they reach in relation of LOC vs. complexity of the original problem, AI-generated programs probably average out at an entirely different "density" number.
I fork Clang or GCC and rename it. I'll take only $10k.
The problem is you may pay $20K for gibberish, then try a second time, fail again, and then hire humans.
Coincidentally yes, I am aware, my last contract was building out a SCADA module the AI failed to develop at the company that contracted me.
I'm using that money to finance a new software company, and so far, AI hasn't been much help getting us off the ground.
Edit: oh yeah, and on top of paying Claude to fuck it up, you still have to also pay the salary of the guy arguing with Claude.
You can easily pay humans $20k a day and get gibberish in output. Heck, this happen all the times. This happens right now in multiple companies.
Yes sometime humans produce nice code. This happens from time to time...
I can get my 2y old child to output 100k LoC, but it won't be very good.
Sorry mate, I think you're tripping.
Earlier today, I couldn't get opus to replace useEffect-triggered-redux-dispatch nonsense with react-query calls. I already had a very nice react-query wrapper with tons of examples. But it just couldn't make sense of the useEffect rube goldberg machine.
To be fair, it was a pretty horrible mess of useEffects. But just another data point.
Also I was hoping opus would finally be able to handle complex typescript generics, but alas...
How do you conclude that? You start off with a bunch of tests and build these things incrementally, why would you spend 20k before realizing there’s a problem?
And the amount of times Claude proposes something thats completely contradictory in the same response. Or completely does a 180 after two more responses. Is ridiculous.
It cost $20,000 and it worked, but it's also totally possible to spend $20,000 and have Claude shit out a pile of nonsense. You won't know until you've finished spending the money whether it will fail or not. Anthropic doesn't sell a contract that says "We'll only bill you if it works" like you can get from a bunch of humans.
Do catastrophic bugs exist in that code? Who knows, it's 100,000 lines, it'll take a while to review.
On top of that, Anthropic is losing money on it.
All of those things combined, viability remains a serious question.