OpenAI CEO Sam Altman revealed on Sunday that the company is losing money on its $200-per-month ChatGPT Pro plan, as user demand has significantly exceeded expectations.
“I personally chose the price,” Altman wrote on X, formerly Twitter. “I thought we would make some money.”
ChatGPT Pro, launched in late 2024, offers access to the enhanced o1 “reasoning” AI model, o1 Pro mode, and removes rate limits on tools like Sora, OpenAI’s video generator. However, the plan’s annual price tag of $2,400 has raised questions about its value, particularly for features like o1 Pro mode. Despite initial skepticism, Altman’s comments suggest heavy usage by subscribers is contributing to the financial strain.
This isn’t the first time OpenAI’s pricing strategy has raised eyebrows. In a Bloomberg interview, Altman disclosed that the original premium ChatGPT plan, priced at $20 per month, was chosen without a formal pricing study.
“We tested two prices, $20 and $42,” Altman said. “People thought $42 was a little too much. They were happy to pay $20. It wasn’t a rigorous process.”
OpenAI has yet to turn a profit despite raising approximately $20 billion since its inception. In 2024, the company reportedly incurred losses of $5 billion on $3.7 billion in revenue. Operational costs, including staffing, infrastructure, and AI training, remain high. ChatGPT alone was once estimated to cost OpenAI $700,000 per day.
To address financial challenges, OpenAI has announced plans for a corporate restructuring aimed at attracting new investments. The company is also considering revising subscription prices and potentially adopting usage-based pricing models.
Despite current losses, OpenAI projects significant revenue growth, forecasting $11.6 billion in 2025 and $100 billion by 2029—comparable to Nestlé’s current annual revenue.
OpenAI’s challenges underscore the complexities of monetizing advanced AI tools. As the company navigates its financial hurdles, its pricing strategies and product development choices will likely set a precedent for the AI industry.