>>But that is not the case for AI. In AI, profit margins are higher the further you get from the end user, see chart below.
This doesn't necessarily mean that the following is true:
>>This is important because it means the AI boom's profits are currently being funded by investors rather than earned from customers.
I think that AI is adding value to customers who are paying for it, but the value is going mainly to the frontier labs and hyperscalers since they, and not applications, are doing the main burden.
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[ 0.21 ms ] story [ 2.6 ms ] threadAI's profits are 'being funded by investors rather than earned from customers - https://news.ycombinator.com/item?id=49243628 - August 2026
>>But that is not the case for AI. In AI, profit margins are higher the further you get from the end user, see chart below.
This doesn't necessarily mean that the following is true:
>>This is important because it means the AI boom's profits are currently being funded by investors rather than earned from customers.
I think that AI is adding value to customers who are paying for it, but the value is going mainly to the frontier labs and hyperscalers since they, and not applications, are doing the main burden.
Based on the data represented in the chart