Episode Details

Good day, humans. Today is a lesson in how badly a big number can mislead you. OpenAI grew last quarter and it still counted as bad news, because Anthropic grew fourteen times over. Alibaba shipped a model small enough to run on your laptop that ties a flagship. ChatGPT got a version with a bedtime. Hollywood signed its first real AI treaty with the company that owns TikTok. And Linear opened up two years of its own data to show what AI actually did to the working day … which (SURPRISE!!!) is not what the pitch decks promised.

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OpenAI Grew 18%. That Was the Problem.

The Wall Street Journal

What happened: OpenAI told investors its second-quarter revenue rose 18% from the prior quarter to $6.7 billion, and shareholders were reportedly disappointed, the Wall Street Journal reported. The reason is sitting one desk over: Anthropic's preliminary Q2 revenue came in above $11.5 billion, up from $787 million a year earlier — a fourteen-fold jump — and it posted positive adjusted operating income, a first for a frontier lab, per Forbes.

Why it matters: Anthropic booked roughly 1.7 times OpenAI's revenue in the same three months, from a company that was a rounding error against it last year. Earlier this week we covered OpenAI's IPO window sliding into 2027 and this is the arithmetic behind that slide. OpenAI's net loss widened from about $5 billion in 2024 to roughly $39 billion in 2025, and Morningstar now puts a realistic listing at mid-to-late 2027.

What everyone's saying: That the consumer-chatbot land grab is a worse business than the boring one. Anthropic's money comes disproportionately from API and enterprise contracts that renew; OpenAI's comes from hundreds of millions of people, most of whom pay nothing and cost money to serve.

My read between the lines: Eighteen percent quarter over quarter is a number most companies and investors would hold a party about. It only reads as failure because OpenAI spent three years selling the story that it was the WHOLE market. When you promise the sky, the sky becomes the floor. The genuinely interesting bit is buried: somebody in frontier AI finally covered part of its own operating costs, and it was not the one with the household name.

📖 Further reading: Fable 5 Costs 2x Opus — and Using It Wrong Costs You More Than That — Whichever lab wins this race, the bill lands on your account — here's how to keep it from doubling by accident.

Two labs just posted quarters that came down to who shipped more actual work per head. Yours can too. Viktor is an AI agent that lives in your Slack (and Teams) and plugs into 3,000+ tools, so instead of another tab that answers questions it writes the weekly report, builds the dashboard, ships the code fix, and runs the campaign — while you sleep. Not a chatbot you prompt. A co