OpenAI CEO Sam Altman revealed on Sunday that the company is currently losing money on its $200-per-month ChatGPT Pro subscription due to higher-than-expected usage.
“I personally chose the price,” Altman shared in a series of posts on X, “and thought we would make some money.”
Launched in late 2023, ChatGPT Pro provides access to a more advanced version of OpenAI’s o1 “reasoning” AI model, as well as enhanced features like o1 pro mode and expanded usage limits for tools like the Sora video generator.
Despite the high price tag of $2,400 per year, the value proposition of some features, such as o1 pro mode, remains unclear to many users. However, judging by Altman’s comments, those who subscribed seem to be using the service more frequently than anticipated, putting OpenAI in the red.
This isn’t the first time OpenAI has faced questions over its pricing strategy. In a recent interview with Bloomberg, Altman admitted that the company didn’t conduct a formal pricing study before launching the premium version of ChatGPT. “We tested two prices, $20 and $42,” he said. “People thought $42 was a little too much. They were happy to pay $20. We picked $20. It wasn’t a rigorous ‘hire someone and do a pricing study’ thing.”
Despite raising approximately $20 billion since its inception, OpenAI has yet to achieve profitability. The company reportedly faced losses of $5 billion against $3.7 billion in revenue last year. Factors such as staffing, office rent, and the cost of AI training infrastructure have driven up expenses. At one point, OpenAI was spending an estimated $700,000 per day to run ChatGPT.
As OpenAI prepares for a corporate restructuring to attract further investments, Altman indicated that the company may raise subscription prices or consider a usage-based pricing model for certain services.
Looking ahead, OpenAI has ambitious revenue projections, aiming for $11.6 billion this year and $100 billion by 2029, which would match the current annual sales of global giants like Nestlé.
