Why? Because its probably the largest video hosting website by multiple orders of magnitude?
And you still hasn't given me a straight answer.
Let's say YOU are Youtube, and you are trying to be an honest businessman (while staying alive).
What would you do?
1. Turn it into a fully paid service. Which means you will probably never take off and some other guy will create an ((((free)))) alternative like Youtube.
2. Free service with premium features but people apparently don't like it because they feel like they are missing out.
I personally prefer 1 because that would remove 99% of the shitty videos that plague the website.
I was saddened when I saw that people don't share my sentiment.
That was the one moment where people have the opportunity to say "yes, let us pay you and you give us a direct and simple service".
I easily "watch" around 12 hours of HD Youtube videos counting all the music in the background that I listen to. It is _definitely_ worth the premium price.
I think the right question is: are they free cash flow-positive? I don't know the numbers off the top of my head. "Operating at a loss" means different things to different people.
Profit is an irrelevant metric for a company like YT that would reinvest every dollar of FCF into growth. (See Amazon for the well-fleshed out reasoning as to why this is so.)
Google is notorious for snuffing products they consider unprofitable. Yet persisted with Youtube for 16 years. Why?