If they time the subsidized user push right their model of expected annual recurring revenue is $10B/y and $11B in 2025 is possible
OpenAI says they already hit $10B annual recurring revenue, for what it’s worth. They don’t provide a breakdown but they do say this excludes major one-time deals and the licensing fees Microsoft pays to use OpenAI models in its own products (this is a substantial source of revenue, but I’m guessing OpenAI excludes this to avoid being accused of using wash transactions to juice their numbers: they in turn pay Microsoft for the servers to train and run their models).
Based on OpenAI only having 3M Team+Enterprise+Edu subscribers in May, I don’t think this $10B/year rate was achieved via $1 Team trial subscriptions.
I think you are reading too much into the growth rate of free users. OpenAI has made a recent push into acquiring lots of new free users, e.g. by making signups easier and putting ChatGPT on WhatsApp, which makes their conversion rate look worse. But their revenue, which comes from paid subscribers and API usage, is still growing at a very healthy and relatively steady rate (3x from $3.4B last year, and 10x from $1B in August 2023) and my guess is that it will continue to grow rapidly.
OpenAI says they already hit $10B annual recurring revenue, for what it’s worth. They don’t provide a breakdown but they do say this excludes major one-time deals and the licensing fees Microsoft pays to use OpenAI models in its own products (this is a substantial source of revenue, but I’m guessing OpenAI excludes this to avoid being accused of using wash transactions to juice their numbers: they in turn pay Microsoft for the servers to train and run their models).
Based on OpenAI only having 3M Team+Enterprise+Edu subscribers in May, I don’t think this $10B/year rate was achieved via $1 Team trial subscriptions.
I think you are reading too much into the growth rate of free users. OpenAI has made a recent push into acquiring lots of new free users, e.g. by making signups easier and putting ChatGPT on WhatsApp, which makes their conversion rate look worse. But their revenue, which comes from paid subscribers and API usage, is still growing at a very healthy and relatively steady rate (3x from $3.4B last year, and 10x from $1B in August 2023) and my guess is that it will continue to grow rapidly.