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Esta obra está bajo una Licencia Creative Commons Atribución-NoComercial-SinDerivadas 4.0 Internacional.

Sunday, October 13, 2024

¿VIVIMOS EN UN TIEMPO QUE SÍ PODEMOS ENTENDER? (II, 13-12-2024)

 In “OpenAI Projections Imply Losses Tripling to $14 Billion in 2026” the spotlight has been brought onto the details of the latest OpenAI fundraise where investors paid $6.6bn valuing the Ponzi scheme, sorry the company, $157bn (OpenAI Raises $6.6 Billion in Funds at $157 Billion Value) just one week ago. Here are the 3 most incredible things reported:

  • OpenAI doesn’t project to be profitable until 2029
  • OpenAI projects to lose $14bn in 2026
  • OpenAI projects to incur $44bn of total losses from 2023 to 2028 EXCLUDING stock-based compensation
  • OpenAI pays 20% of its revenues to Microsoft

 Among all OpenAI investors, there is one, the largest, that desperately needs OpenAI to stay in business: Microsoft. The relationship between the two companies isn’t a simple one of a customer and a service provider, and I have already addressed the concerning details many times:

 In a nutshell, Microsoft has been printing Azure credits “out of thin air” to purchase equity in hyped startup companies, especially OpenAI. Then when these companies use the credits, Microsoft books revenues in its income statement. It does not take a degree in accounting to understand that there is no cash involved in this process, but investors and Wall Street analysts love to see top-line growth without asking questions about where that growth comes from.

 Under U.S. GAAP, two companies are considered affiliated entities when one has significant influence over the other but owns less than 50% of its voting shares. “Significant influence” means one company can affect decisions like policies or management without fully controlling the other. In such cases, transactions between these affiliates (like sales or services) cannot be counted as revenue or expenses in the financial statements because they are considered internal transfers, not external business transactions.

 OpenAI is effectively a revenue laundromat for Microsoft and the company does not even hide it in its own projections as you can see in the chart below considering “Microsoft Revenue Shares”, “Compute To Train Models”, “Compute To Run Models”, “Research and Computing Amortization” and “Hosting” are all items related to OpenAI relationship with Microsoft.

 


Of course, Microsoft isn’t alone in such a fraudulent scheme, which, to be clear, has already been replicated with many other smaller startups. NVIDIA has been a partner in it since the very beginning, hence it should not surprise everyone that they participated in this investment round. NVIDIA has only one goal: keep booking orders for its GPUs to keep its stock valuation inflated to a level that is only justified by the fact that every single person in the world will be eating GPUs for breakfast, lunch, and dinner in the future. However, NVIDIA has a problem with one of the companies that has been instrumental in boosting its incredible (albeit fake) growth: SMCI – THE NUCLEAR NOTHING BURGER THAT CAN EXPOSE NVIDIA SHENANIGANS. That the two companies have been cooperating in the same scheme is obvious to anyone paying attention (“HYPERSCALERS” OR “HYPERCHEATERS”? – ADDING HINDENBURG PIECE TO THE BIG PONZI PUZZLE WE HAVE BEEN PUTTING TOGETHER TILL NOW WHILE WAITING FOR NVIDIA EARNINGS), but luckily for them, no one but a few really do nowadays.

SoftBank is another company that participated in OpenAI’s latest fundraise since it belongs to the category of those in desperate need for the bubble not to pop:

The DOJ is already investigating on many fronts, from Microsoft and Nvidia’s questionable buying spree of startup companies to SMCI’s fraudulent accounting. However, all the companies I mentioned are doing such an incredible job combining timely PR, stock buybacks, and extremely sophisticated accounting to keep the fraud from being exposed to the general public that keeps loving them and buying their shares. Mark my words, all this is going to end very badly, ultimately popping the semiconductor bubble and leaving many clueless investors in ETFs, Passive Funds, and Pension Funds significantly damaged (IT HAS NEVER BEEN A BUBBLE IN AI, BUT A PONZI SCHEME IN SEMICONDUCTOR STOCKS SINCE THE VERY BEGINNING). 

 

 

 

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