According to a recent investigation by The Financial Times, businesses who have partnered with OpenAI to provide data centers, semiconductors, and "compute" processing capacity have borrowed almost $96 billion in debt to finance their operations.
The study claims that businesses like SoftBank, Oracle,
and CoreWeave have borrowed at least $30 billion to invest in the losing startup, which profits from a debt-fueled spending binge without having to bear any financial burdens.
This demonstrates the AI sector's growing reliance on debt and its growing reliance on a single business for future profits.
Currently, the profits made by AI firms and the data center operators that are quickly growing to cater to them are far too small to pay the build-out expenses.
It's been a sort of tactic. A senior OpenAI official was quoted by FT as saying, "How does [OpenAI] leverage other people's balance sheets?"
OpenAI's $1.4 trillion plan to acquire the energy and processing power for its operations over the next eight years has already drawn criticism. The loans, which are expected to reach $100 billion in the near future, will increase monitoring.
The promises surpass OpenAI's estimated $20 billion in annualized revenue for this year.
What is the total amount of loans taken out by OpenAI partners to date?
According to FT, the total amount of loans that OpenAI's partners have taken out thus far is broken out as follows:
A total of $30 billion has already been borrowed for OpenAI by SoftBank, Oracle, and CoreWeave.
Blue Owl Capital and Crusoe have taken out loans totaling up to $28 billion.
In the meantime, discussions to borrow a further $38 billion to support OpenAI activities have already begun between Oracle, Vantage, and their banks.
This reduces the total debt that these businesses have taken on to roughly $96 billion. According to FT, which cited people with knowledge, OpenAI has minimal debt on its own balance sheet.
In the field of artificial intelligence, the growing usage of debt is a relatively recent phenomenon. In the past, the majority of AI development was financed by money from large tech firms like Microsoft, Alphabet, Amazon, and Meta.
"The most crucial thing we can do to meet the growing demand worldwide is to build AI infrastructure." The largest obstacle to OpenAI's expansion, according to the company, is the current computing shortage.
0 Comments