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OpenAI’s planned cash burn was unlike anything we’d ever seen — now they’re doubling it

OpenAI is still the molten mass at the center of the AI universe, burning billions as it pulls talent, capital, and companies into its orbit.

David Crowther

Many of the world’s most successful tech startups burned cash for years before they got out of the red. Lighting tens of millions of dollars — or even a few billion in the most extreme cases, like Uber, Tesla, or Netflix — on fire every year became the norm as growth-obsessed disruptors invested in software, hardware, branding, and content to reach the scale required for their margins to turn positive.

But, as we noted last year, the sheer scale of OpenAI’s cash burn plans have been unlike anything we’ve ever seen. And thanks to some great new reporting from The Information late last week, we know that the company’s cash burn forecasts are actually even more insane than we previously thought.

Per the new figures reported, OpenAI expects to burn through $218 billion between 2026 and 2029, about $111 billion more than the company’s internal projections from just two quarters ago.

That $218 billion is 23x what Tesla burned in its cash-incinerating phase from 2007 to 2018.

In fairness to OpenAI, ChatGPT is probably still the fastest-growing stand-alone product of all time, and if the company hits its revenue goal, it certainly won’t be the cash burn of previous years that has people talking.

Indeed, after chewing through the equivalent of the GDP of Ukraine, the company expects cash flow to turn dramatically positive in 2030 as revenue soars to ~$280 billion in 2030 thanks to consumer ChatGPT subscriptions as well as a plethora of new revenue streams, including API access, dedicated agentic enterprise subscriptions, advertising, and even AI-powered hardware (including maybe a smart speaker and a smart lamp).

1M 🔋🔁

Max Knoblauch16m

Chinese EV maker Nio is climbing on Monday following news that the company provided a million battery swaps in China in less than a week. Nio shares are up about 6%.

Nio’s battery swap process is an alternative to charging. Depleted EV batteries are swapped out at stations for fully charged ones in less than three minutes — significantly faster than fast charging.

The company, which operates 3,750 swap stations, said it has broken daily swap records in China six times this month, as millions travel across the country over the Lunar New Year holiday. On Sunday, Nio performed 177,627 swaps.

Earlier this month, Nio CEO William Li said the company would add 1,000 swap stations this year.

Luke Kawa43m

PayPal jumps after report of unsolicited takeover interest

Bloomberg reports that PayPal is the subject of takeover interest, with shares down nearly 90% from their 2021 closing high.

Per the report, management “has fielded meetings with banks amid unsolicited interest from suitors,” citing people familiar with the matter.

After being briefly halted for volatility, shares jumped 8%.

There’s reportedly appetite from “one large rival” to buy the entire company, while other potential purchasers want only certain parts.

Shares of the payments company recently closed at their lowest level since 2016, having lost ground to the likes of Apple and Google in the digital realm.

Earlier this month, shares cratered after the company posted weaker-than-anticipated Q4 results and 2026 profit guidance while announcing its CEO would soon be leaving the company.

Matt Phillips1h

Sandisk shakes off slide from secondary offering

Sandisk continued to shake off a slump that hit the shares last week after it priced a secondary offering of almost 6 million shares owned by its former parent, Western Digital.

Tomorrow marks a year since Sandisk started trading on its own, after its spin-off from WDC. The stock soared amid a global shortage of memory chips that seemed to catch even experts completely off guard. The stock is up almost 1,300% since it began trading independently.

The company appeared to tease an event or product launch for tomorrow, February 24, in an X post on Friday, but the specifics were not entirely clear.

Sandisk’s gain over that period is the largest of any constituent of the S&P Total Market Index with a market cap of $4 billion or more — and the third-largest increase overall, out of its roughly 3,800 constituents.

Year to date, Sandisk is among the best performers in the Russell 1000 Technology Index and a key driver of the trend that has seen small clutch of hardware manufacturers trounce software shares.

Luke Kawa

Software stocks crater as independent research piece details potential AI dystopian scenario

The lowlights in this dystopian not-too-distant future: unemployment high despite elevated nominal growth and productivity, and the stock market tumbling as credit stress from companies laid low by AI metastasizes.

Man in desert with robodog and floating tower blocks

Luke Kawa2h

Better-than-expected jobs data has Federal Reserve’s standout doves shying away from rate cuts

Surprisingly strong labor market data has the Federal Reserve’s standout doves more willing to stand down from advocating for additional rate cuts.

Governor Christopher Waller said his decision on whether he would be in favor of a rate cut at the Fed’s upcoming meeting in March would be “a coin flip” depending on the jobs market data for February.

“If the labor market data for February are consistent with the stronger job creation and low unemployment rate initially reported in January, indicating that downside risks to the labor market have diminished, it may be appropriate to hold the FOMC's policy rate at current levels and watch for continued progress on inflation and strength in the labor market,” he said in a speech on Monday.

In January, nonfarm payrolls growth of 130,000 came in well above estimates, and the unemployment rate unexpectedly dipped to 4.3%. The unemployment rate had edged down to 4.4% in December.

Prediction markets indicate that the Federal Reserve is seen as a near lock to keep its policy rate unchanged at the March meeting. The prediction market-implied odds of a rate cut in June are a little over 60%.

(Event contracts are offered through Robinhood Derivatives, LLC — probabilities referenced or sourced from KalshiEx LLC or ForecastEx LLC.)

Governor Stephen Miran also recently told The Peg that, in the absence of further data, he would probably move up his expectation for the appropriate level of the federal funds rate at year-end by 50 basis points (to 2.625%).

“The labor market came in a little bit better than I came to expect over the last few months,” he said. “There’s been some signs of even more firming in goods inflation.”

Both Waller and Miran dissented from the US central bank’s decision to keep rates unchanged in January, preferring an interest rate cut.