Anthropic is currently profitable, generating around $1B/quarter and ~$50B in ARR. About 75% to 85% of Anthropic's revenue comes from its usage-based API business, which has a gross margin that exceeds 80%. https://www.tradingkey.com/analysis/stocks/us-stocks/2620181...
Meanwhile, OpenAI is at ~$25B ARR, but is likely not yet profitable.
The divergence in business models is directly reflected in financial data. SemiAnalysis estimates that Anthropic's overall gross margin has rebounded from negative 94% in 2024 to the mid-60% range, with the gross margin of its API business exceeding 80%.
Their link seems to claim semi analysis thinks it is 80%. It looks like it might be referencing this newer article from them, as the same picture is in both articles, but I didn't feel like paying to find out: https://newsletter.semianalysis.com/p/anthropic-3q26-profit-...
Looks like it’s behind a paywall. I’ll take their word for it that semi analysis now estimate it to be 80%. That makes my point even stronger, if that number is true, where is the money? The report says that Anthropic generate over $50bn in revenue so at 80% margins that gives $40bn in profit. Where is that money? If they’re generating $40bn in profit, even after accounting for very high employee compensation and training costs… they should have tens of billions in profit, yet they’re out raising tens of billions instead. Where is the money going? And if only 20% is their actual inference costs, where are all these compute providers going to make their money? The world is at compute capacity on, what, $10bn in revenue?
If you figured out how to build a machine that turns electricity into gold with an 80% margin, of course you’d go out raising capital to build more machines.
Your contention is they're spending it on what, exactly? Leaks put OpenAI's training spend at single-digit billions so that can't be the machines they're building, and they (OpenAI + Anthropic) are famously renting/leasing/borrowing compute through varying-degrees-of-circular deals... so what's the machines they're building?
but your contention is they are profitable on inference. Why would they need to raise money to get their hands on compute if they're making money on compute? There's no upfront costs for Anthropic, Anthropic don't own or build compute infrastructure, they just rent access to compute owned by someone else, such as the $15bn/year SpaceX deal they signed recently (which they used to create more demand without increasing revenue).
The more capital Anthropic has, the more compute they can put their hands on and sell at a massive markup for Claude inference.
Limiting themselves to the profits from the compute they already have when capital markets are dying to give them cash at favorable terms would be foolish.
You’re missing the point. Anthropic are bringing more compute online by renting it and then they are creating the demand for it by increasing the limits on fixed cost plans. Anthropic are increasing their spend on compute without increasing revenues. I’m not guessing that, it is part of their announcements!
“First, we’re doubling Claude Code’s five-hour rate limits for Pro, Max, Team, and seat-based Enterprise plans.
Second, we’re removing the peak hours limit reduction on Claude Code for Pro and Max accounts.“
Every one of these plans is a fixed cost. Anthropic doubled their limits without changing the price. Even if inference is wildly profitable and these plans aren’t subsidized, they’ve just cut the profitability in half.
And the non-plan usage that is being paid for directly is paid for monthly. If they can sell $1 of compute as $10 of inference then they have $9 the next month to spend on more compute. Of course the capital markets would want to give them money if that were true but they would have no reason to take it.
Why would a net 30 business need to borrow hundreds of billions over many years? Anthropic currently spends an estimated $5bn/month on compute so at most they need to float $5bn, but if they’re making 90% margins on compute, that $5bn would be paid for… within a couple of days. Where is the hundreds of billions of dollars?
I think that is correct, and exactly why these purported margins are nonsensical. If Anthropic's reported $50 billion in revenue is majority per-token billing, and tokens have a margin of 80%, that would put Anthropic's profit at $30 billion on per-token usage. Where is that $30 billion going?
And conversely, let's look at the amount Anthropic are spending on compute. Anthropic has just started paying SpaceX $1.25 billion per month for compute. At an 80% profit margin that would mean Anthropic is going to be bringing in $6.25 billion per month... that's more than their current reported revenue.
And that's just one contract for compute. We know that Anthropic also pay Google ~$3 billion per month for compute (based on their committed spend of $200bn over 5 years) which is $36 billion per year. At $36 billion per year on compute with 80% margins that would put revenue at... $180 billion.
Add in their spend with Amazon and Microsoft, Anthropic are spending at least $4 billion per month on compute, or $48 billion per year, all but equal to their revenue. If margins on tokens are 80% and an estimated $37.5 billion of revenue is per-token revenue, that needs just $7.5 billion of compute per year, less than $1 billion per month.
The numbers just don't add up. If margins are 80% and they have $48 billion per year in compute spend, revenue should be over $200 billion.
If the 80% margin made any sense whatsoever, Anthropic would be printing money, yet they're losing money, and have only been profitable for one month based on some financial engineering (pre-commitments billed after the fact to reduce their costs during one month).
My guess is margins are closer to 20% than 80%. That's the only way any of the numbers can make sense.
Whatever the actual net margins, I’m guessing any “80%” kind of figure is calculated as of full utilization of the hardware / capital, which of course they’ll rarely if ever even approach.
Even if margins are “only” 20% though, the magic beans are still real: If you could build (or rent) a box, fill it with magic beans, and get 20% margins against demand stretching out to the horizon, Wall Street would rob their grandmothers to give you cash to build or rent more boxes.
no, even if we assume their margins are 90% (they are not) they are still losing money because the $200 plans allow for tens of thousands of dollars worth of inference and a huge number of users are milking every cent across multiple accounts. Every “reset” OpenAI and Anthropic do is setting money on fire.
If it were true that they’re making money hand over fist they wouldn’t need to raise tens of billions of dollars every few months.
In Amodei’s Dwarkesh podcast he says that they are constantly estimating the increase in demand for the next leg up, then going out to raise money to build for it. So it’s not necessarily that they are raising money because they are unprofitable.
Anthropic aren't building out the data centres themselves, they're renting/leasing/borrowing from companies that are doing the actual spend on building out infrastructure. And the data centre companies aren't spending their own money, they're borrowing too (hence Apollo investing in data centres). Anthropic are paying SpaceX ~$1.25bn/month right now for access to more compute, that's $15bn a year, more than what these supposed margins would require in total spend (based on current revenue estimates).
The SpaceX deal is a great example of Anthropic creating demand, i.e:
We’ve agreed to a partnership with SpaceX that will substantially increase our compute capacity. This, along with our other recent compute deals, means that we’ve been able to increase our usage limits for Claude Code and the Claude API.
They committed to spending $15bn per year with SpaceX and then increased limits for customers on fixed cost plans, creating more demand without any increase in revenue.
So, sure, it's not necessarily that they are raising money because they are unprofitable, but no alternate explanation makes any sense. The argument that could maybe made in favor is based on announcements like this one:
Today, we are announcing a $50 billion investment in American computing infrastructure, building data centers with Fluidstack in Texas and New York, with more sites to come. These facilities are custom built for Anthropic with a focus on maximizing efficiency for our workloads, enabling continued research and development at the frontier.
You might conclude from that, Anthropic are financing Fluidstack's build out, but they're not.
Just after that announcement, Fluidstack raised $830 million to build out data centres, none of the money coming from Anthropic. Fluidstack are currently rumored to be raising another $1bn. Anthropic's "$50 billion investment in American computing infrastructure" is just committed spend on renting compute from Fluidstack, a commitment that Fluidstack then use to raise money to actually deliver it. If Anthropic making money hand over fist, they wouldn't need to raise for committed spend.
And thus we return to the original question, how does future demand translate to spend? Actual handing over of dollars?
even if we assume their margins are 90% (they are not)
How do you know they are not?
It will be curious to see the cost of inference for these newly released open weight models and will help give an idea of the actual cost of inference. But for now, I think saying the $200 plans allows for "tens of thousands of dollars worth of inference" provides very little insight when you are measuring the inference cost in API pricing with an unknown margin.
The simple question to ask is, if it is so profitable, where is all the money going? If Anthropic have 90% margins on API usage and API usage is $50bn+ in revenue per year, where is the $45bn going? Why do they need to raise so much cash, constantly?
Comments
"subsidizing" aka making 30% gross margin instead of 90%.
Do they actually have net positive income (excluding research, I guess)? I assumed no but I’ve never seen number one way or another.
Anthropic is currently profitable, generating around $1B/quarter and ~$50B in ARR. About 75% to 85% of Anthropic's revenue comes from its usage-based API business, which has a gross margin that exceeds 80%. https://www.tradingkey.com/analysis/stocks/us-stocks/2620181...
Meanwhile, OpenAI is at ~$25B ARR, but is likely not yet profitable.
Where are you getting that 80% figure from? Even semi analysis, the most aggressively optimistic analysts, put it at around 60%.
https://newsletter.semianalysis.com/p/anthropic-growth-and-b...
Their link seems to claim semi analysis thinks it is 80%. It looks like it might be referencing this newer article from them, as the same picture is in both articles, but I didn't feel like paying to find out: https://newsletter.semianalysis.com/p/anthropic-3q26-profit-...
It's clearly listed in the article I linked. The number comes from SemiAnalysis, from a newer report than the one you cited.
Looks like it’s behind a paywall. I’ll take their word for it that semi analysis now estimate it to be 80%. That makes my point even stronger, if that number is true, where is the money? The report says that Anthropic generate over $50bn in revenue so at 80% margins that gives $40bn in profit. Where is that money? If they’re generating $40bn in profit, even after accounting for very high employee compensation and training costs… they should have tens of billions in profit, yet they’re out raising tens of billions instead. Where is the money going? And if only 20% is their actual inference costs, where are all these compute providers going to make their money? The world is at compute capacity on, what, $10bn in revenue?
If you figured out how to build a machine that turns electricity into gold with an 80% margin, of course you’d go out raising capital to build more machines.
Your contention is they're spending it on what, exactly? Leaks put OpenAI's training spend at single-digit billions so that can't be the machines they're building, and they (OpenAI + Anthropic) are famously renting/leasing/borrowing compute through varying-degrees-of-circular deals... so what's the machines they're building?
Just as the article supposes: Getting their hands on as much compute as possible to address rapidly growing demand for inference.
but your contention is they are profitable on inference. Why would they need to raise money to get their hands on compute if they're making money on compute? There's no upfront costs for Anthropic, Anthropic don't own or build compute infrastructure, they just rent access to compute owned by someone else, such as the $15bn/year SpaceX deal they signed recently (which they used to create more demand without increasing revenue).
https://www.anthropic.com/news/higher-limits-spacex
The more capital Anthropic has, the more compute they can put their hands on and sell at a massive markup for Claude inference.
Limiting themselves to the profits from the compute they already have when capital markets are dying to give them cash at favorable terms would be foolish.
You’re missing the point. Anthropic are bringing more compute online by renting it and then they are creating the demand for it by increasing the limits on fixed cost plans. Anthropic are increasing their spend on compute without increasing revenues. I’m not guessing that, it is part of their announcements!
https://www.anthropic.com/news/higher-limits-spacex
“First, we’re doubling Claude Code’s five-hour rate limits for Pro, Max, Team, and seat-based Enterprise plans.
Second, we’re removing the peak hours limit reduction on Claude Code for Pro and Max accounts.“
Every one of these plans is a fixed cost. Anthropic doubled their limits without changing the price. Even if inference is wildly profitable and these plans aren’t subsidized, they’ve just cut the profitability in half.
And the non-plan usage that is being paid for directly is paid for monthly. If they can sell $1 of compute as $10 of inference then they have $9 the next month to spend on more compute. Of course the capital markets would want to give them money if that were true but they would have no reason to take it.
Why would a net 30 business need to borrow hundreds of billions over many years? Anthropic currently spends an estimated $5bn/month on compute so at most they need to float $5bn, but if they’re making 90% margins on compute, that $5bn would be paid for… within a couple of days. Where is the hundreds of billions of dollars?
My understanding is that Anthropic’s massive revenue surge over the past 9 months has been driven by enterprise consumers paying by the token.
Do you think that’s wrong?
I think that is correct, and exactly why these purported margins are nonsensical. If Anthropic's reported $50 billion in revenue is majority per-token billing, and tokens have a margin of 80%, that would put Anthropic's profit at $30 billion on per-token usage. Where is that $30 billion going?
And conversely, let's look at the amount Anthropic are spending on compute. Anthropic has just started paying SpaceX $1.25 billion per month for compute. At an 80% profit margin that would mean Anthropic is going to be bringing in $6.25 billion per month... that's more than their current reported revenue.
And that's just one contract for compute. We know that Anthropic also pay Google ~$3 billion per month for compute (based on their committed spend of $200bn over 5 years) which is $36 billion per year. At $36 billion per year on compute with 80% margins that would put revenue at... $180 billion.
Add in their spend with Amazon and Microsoft, Anthropic are spending at least $4 billion per month on compute, or $48 billion per year, all but equal to their revenue. If margins on tokens are 80% and an estimated $37.5 billion of revenue is per-token revenue, that needs just $7.5 billion of compute per year, less than $1 billion per month.
The numbers just don't add up. If margins are 80% and they have $48 billion per year in compute spend, revenue should be over $200 billion.
If the 80% margin made any sense whatsoever, Anthropic would be printing money, yet they're losing money, and have only been profitable for one month based on some financial engineering (pre-commitments billed after the fact to reduce their costs during one month).
My guess is margins are closer to 20% than 80%. That's the only way any of the numbers can make sense.
Thanks, that makes your theory much clearer.
Whatever the actual net margins, I’m guessing any “80%” kind of figure is calculated as of full utilization of the hardware / capital, which of course they’ll rarely if ever even approach.
Even if margins are “only” 20% though, the magic beans are still real: If you could build (or rent) a box, fill it with magic beans, and get 20% margins against demand stretching out to the horizon, Wall Street would rob their grandmothers to give you cash to build or rent more boxes.
no, even if we assume their margins are 90% (they are not) they are still losing money because the $200 plans allow for tens of thousands of dollars worth of inference and a huge number of users are milking every cent across multiple accounts. Every “reset” OpenAI and Anthropic do is setting money on fire.
If it were true that they’re making money hand over fist they wouldn’t need to raise tens of billions of dollars every few months.
https://xcancel.com/i/article/2076078865060151465
In Amodei’s Dwarkesh podcast he says that they are constantly estimating the increase in demand for the next leg up, then going out to raise money to build for it. So it’s not necessarily that they are raising money because they are unprofitable.
How does future demand translate to spend?
Anthropic aren't building out the data centres themselves, they're renting/leasing/borrowing from companies that are doing the actual spend on building out infrastructure. And the data centre companies aren't spending their own money, they're borrowing too (hence Apollo investing in data centres). Anthropic are paying SpaceX ~$1.25bn/month right now for access to more compute, that's $15bn a year, more than what these supposed margins would require in total spend (based on current revenue estimates).
https://www.anthropic.com/news/higher-limits-spacex
The SpaceX deal is a great example of Anthropic creating demand, i.e:
They committed to spending $15bn per year with SpaceX and then increased limits for customers on fixed cost plans, creating more demand without any increase in revenue.
So, sure, it's not necessarily that they are raising money because they are unprofitable, but no alternate explanation makes any sense. The argument that could maybe made in favor is based on announcements like this one:
https://www.anthropic.com/news/anthropic-invests-50-billion-...
You might conclude from that, Anthropic are financing Fluidstack's build out, but they're not.
https://x.com/fluidstack/status/2079250004510728559
Just after that announcement, Fluidstack raised $830 million to build out data centres, none of the money coming from Anthropic. Fluidstack are currently rumored to be raising another $1bn. Anthropic's "$50 billion investment in American computing infrastructure" is just committed spend on renting compute from Fluidstack, a commitment that Fluidstack then use to raise money to actually deliver it. If Anthropic making money hand over fist, they wouldn't need to raise for committed spend.
And thus we return to the original question, how does future demand translate to spend? Actual handing over of dollars?
How do you know they are not?
It will be curious to see the cost of inference for these newly released open weight models and will help give an idea of the actual cost of inference. But for now, I think saying the $200 plans allows for "tens of thousands of dollars worth of inference" provides very little insight when you are measuring the inference cost in API pricing with an unknown margin.
We don’t “know” because they haven’t released any numbers but the most optimistic estimates (which many people believe are very very optimistic) put it at 60%: https://newsletter.semianalysis.com/p/anthropic-growth-and-b...
The simple question to ask is, if it is so profitable, where is all the money going? If Anthropic have 90% margins on API usage and API usage is $50bn+ in revenue per year, where is the $45bn going? Why do they need to raise so much cash, constantly?
I am not knowledgeable about their finances.
But I do wonder how a 60% margin would be realistic when Sonnet costs 3-6x more than GLM 5.2 hosted by third party providers.
they're taking the revenue and spending it on infra they're borrowing money and spending that on infra somehow, they still don't have enough capacity