[Zafira]

Personally, I’m just exhausted. They are not obligated to be truthful here, so the entire thing is interpreted based on vibes. If you are an AI booster, this is proof that the demand is there; if you aren’t, you’re baffled at where these numbers are coming from.

[reilly3000]

I think the level of panic in CFO offices every where about AI cost explosion directionally validates that the spending is real.

[ricardobayes]

There is no panic, it's misreporting and bad journalism. 2025 AI budgets were based on 2025 AI capabilities, and let's face it, LLMs only got acceptable in around November 2025. So it's natural usage went up and budgets didn't account for that.

[aprilthird2021]

There's absolutely someone in every big company except the biggest tech companies in the world looking at spend these days because of exactly what you said. The models are good now which means people use them a lot more which means money is flying out the door more than ever before (and the impact on the businesses hasn't shown up yet as you might notice in the earnings of any business that isn't a frontier AI company)

[ethbr1]

The root problem: At every company, there is always more work that could be done, but there is not always more work that would increase profits.

Existing corporate command and control has optimized for people control, because people cost money and performed work. Control their assignments, and you control costs and what's worked on.

Widespread unmetered AI turns this on its head, because suddenly each employee is directing their own work and the AI spend that comes with it.

F.ex. Bob in accounting may think it's a brilliant idea to rebuild Lotus 1-2-3.

That may help Bob, but 10x'ing Bob's spreadsheet output doesn't change the company's profitability, because it wasn't a limiting factor. It was to Bob, but not to the company's revenue generators.

HN didn't like this article when it hit, but I thought it made a good point that corporate C2 is going to be the first thing AI adoption breaks: https://www.forbes.com/sites/jasonwingard/2026/04/23/vibe-co...

Increasing AI spend without profitability improvements is a symptom that C2 is failing (or was insufficient to begin with).

Seen through a charitable "CEOs know what the fuck they're doing" lens, the preemptive layoffs are about forcing AI efficiency gains in areas CEOs expect them: instead of allowing those departments' remaining employees to build their own apps, they're forced to deploy AI to cover for their missing 3 team members.

Unfortunately, the layoffs were executed before there were solid results about which departments could benefit from AI use (and without a plan for continuity of institutional knowledge), so... we'll see.

[aprilthird2021]

I mean, the layoffs we are going through right now are patently due to the high cost of AI buildouts and transitions. Meta is taking on significant debt for the first time in a long time to continue their build out plans as AI components have spiked in price.

I get what you're saying about how every employee becomes a liability when they are let loose with an AI, and totally agree. But I think the layoffs have a much more financial root because they are so widespread across so many companies and even industries (not just tech)

[ethbr1]

My point about layoffs is that with widespread AI adoption and without department-targeted layoffs, a company risks their AI spend disappearing into the void.

Layoffs + access to AI forces most of that AI use to make up for the layoffs.

Which is a pretty shitty way to burn your employees out... but it has a method.

(Also, I'd say AI infra companies vs everyone else are apples to oranges. This point would be more applicable to a non-AI infra company that's paying for AI use rather than AI infra capital)

[solumunus]

I really can’t fathom the Meta strategy at all here.

[conartist6]

Right but that kinda like just happened. The market hasn't fully reacted to it yet, so it's hard to say that now is the moment when it's safe to draw a linear extrapolation.

[trhway]

As Anthropic with all its revenue still needs a large outside capital, it suggests that those AI costs those CFOs pay probably don't cover the actual Anthropic's costs.

[jimnotgym]

As that sort of person myself, albeit not in a software company right now, my thought process would be this.

1) I have a new extra cost 2) How does that make me more profit, and improved cashflow

I know I'll be bombarded with metrics about productivity, feature completion, bug fixes etc. But someone is going to have to tell me how that equates to more sales. And who is going to do that? I'll be worried that the feature wishlist will just creep up now we can handle more throughput, and yet everyone will be telling me that I don't need to worry about the lack of new customers this quarter, one more new feature and we will catch up in Q4. You can see how that could make one grumpy. Then when the sales don't come, I'll tell the CTO that they need to balance the books, if they want to use expensive tools to make each developer more productive then they will need fewer developers...

...but I don't want that, I want more great features that people will pay for, and faster. But they have to pay for themselves.

[c0rruptbytes]

i would assume investors giving billions of dollars have done their due diligence and not base it off vibes...

[vishnugupta]

You’d be surprised how much vibe is there in VC investing.

When one is under the grip of irrational exuberance and FOMO due diligence goes out the window.

For example look at Sequoia’s investment into FTX and article about Sam that accompanied.

[Nevermark]

True, but this is not what might be considered an unexamined company. You can be sure it's under all its investors' microscopes.

If for no other reason than they would rather spend their days procrastinating on everything else, so they can obsess over some of the most interesting numbers they will ever see.

[casey2]

FTX was examined, investors thought it was impressive that Sam was playing Bronze ELO LOL while in meetings.

[GoblinSlayer]

Soros too believes that traders are retarded.

[fuzzfactor]

Well if you've got billions of dollars just sitting around doing nothing, and many many more billions of dollars that are performing wonderfully, you should be able to afford throwing a few billion away if that's what ends up happening.

[c0rruptbytes]

yes but Sequoia invested like 200m, we're talking like Google investing 30b...very different scales and bureaucracies

[sandeepkd]

I seriously doubt that anyone is doing much of a due diligence here. They are either counting on others to do it and just follow along OR investing some more money to keep this thing alive enough to go through the IPO.

ARR seems like a interesting concept which hides away the concrete details and is counting on a futuristic possible commitment especially for companies at this early stages. The crucial detail is probably the money being spent, that is what is fueling this sale of equity at this point.

[Nevermark]

> ARR seems like a interesting concept

Yes, it is a meaningful financial measure of actual progress, exactly where progress is most needed for a new company.

> which hides away the concrete details

A normal metric isn't a magic trick. It's just the number it is.

> The crucial detail is probably the money being spent

Accelerating (not just fast) revenue growth at an astounding rate, with absolute numbers that are enormous for a new company, bonkers for a 2500 employee startup [0], is the crucial "detail".

There are lots of companies with deep pockets and compute, making great AI efforts with teams of smart people, that would love to be doing, but are not doing, what Anthropic is doing and doing well. That might be the second crucial detail.

[0] https://en.wikipedia.org/wiki/Anthropic

[sandeepkd]

> A normal metric isn't a magic trick. It's just the number it is.

ARR as a number for steady business or public company is much simpler, ARR for companies at this early stage fueled by the motivation for IPO is more than just a number. Its an attempt to convince the market for a certain outcome without revealing the books

> Accelerating (not just fast) revenue growth at an astounding rate

This acceleration is fueled by somewhat artificial demand (AI mandates by executives across the board, still figuring out the realistic use cases) and subsidized pricing. The expenses matter cause they are the ones which are going to dictate if the business is sustainable or not.

[Nevermark]

> ARR as a number for steady business or public company is much simpler, ARR for companies at this early stage fueled by the motivation for IPO is more than just a number. Its an attempt to convince the market for a certain outcome without revealing the books

Of course ARR is simpler for less dynamic companies. Tautology.

Of course a PR is a communication to the market. Also a tautology.

You are framing functional numbers and behavior as fraudulent because... a newsy PR isn't a formal disclosure?

Cynicism is fine. However: accusations should reference some evidence, not just distrust.

[bnagh]

They get in now because they want a high IPO exit. They care about the perception of the numbers, not about reality.

If you think investment banks will catch them during the IPO: They have launched many overpriced IPOs in 1999/2000 and also want a high IPO price.

[sberens]

Investors are usually prevented from selling until 180 days after IPO

[throwaway85825]

The rules can be changed, they did for spacex.

[stingraycharles]

Yeah but SpaceX has undergone some “changes” in the past few months that make it a dumpster fire, rather than Anthropic’s explosive growth. Also, I don’t think the CEOs of both companies operate in the same way.

[throwaway85825]

I dont see why changes at spacex would necessitate any changes at nasdaq.

[coldtea]

They have a dozen tricks to get around that... e.g.

"The passive funds holding trillions of dollars of 401(k)s and other investments are rushing to change their rules as the IPOs of SpaceX, OpenAI and Anthropic draw closer."

Those index providers are the same interest class with VCs. With such moves they inflate demand post-IPO (hoping it holds for 180+ days), but also allows them to lure buyers in private secondary market and offload that shit pre-IPO.

https://www.wsj.com/finance/stocks/stock-indexes-are-contort...

[rchaud]

If the investors are VCs, they can sell their holdings to a syndicate of underwriter banks in advance of the IPO, and let the banks shoulder the risk of finding a bigger fool in the secondary markets.

[lurk2]

WeWork, Theranos, FTX

[ajyoon]

Investors made bad decisions all the time. The proof is in revenue.

[vdfs]

That's basically how 2008 happened

[AlexandrB]

There are plenty of examples of investors going off of vibes: Theranos, Juicero, WeWork. Though Anthropic would be a particularly egregious example if it does end up failing.

[dogwalker5000]

After cases like Madoff, Theranos, and FTX … I don’t know about that.

[iancmceachern]

I used to think this too. Now I know different.

[coldtea]

Market crashes like the dotcom bust, and countless companies stock rising to high heavens to crash a few months after IPO to shit say otherwise. VALinux was a poster child for investment... lol

Not to mention even a total shitshow from an obvious crackpot like Theranos got $1.2 billion total funding, and a 9B valuation. Or FTX.

[duped]

Investors would never give billions of dollars to liars

[sandeepkd]

Idk if anyone cares about lying at this point anymore, this is just placing bets on the AI, and its a lot easier to bet when its someone else's money.

[mgfist]

I started a new job recently after 9 months off. Last Sept I was coding almost entirely by hand, using AI for q/a, debugging and such.

In my new job I haven't written a single line by hand. I now almost entirely work in claude code / codex and in github PRs. Occasionally I open vscode to read code, but very rarely. My company probably spends ~$100 a day for my token use. I'm not even going crazy with parallelization or subagents and such.

I 100% believe the demand growth based on my personal experience.

[Traubenfuchs]

Talking to dev friends, dev colleagues and qa colleagues in a space where everyone is doing high volume CRUD and cloud slop with many microservices and constantly evolving business requirements: Every single one is primarily coding with claude, a few with cursor. Handwriting code is dead.

[semiquaver]

  > They are not obligated to be truthful here

What are you talking about? It’s securities fraud for a CEO to lie about the financials of a company regardless of whether it’s public or private.

[33vss]

more than likely what he meant is their metrics may be non-GAAP.

[rchaud]

And the punishment for securities fraud is a slap on the wrist, as Tesla proved with its "going private at $420/share, funding secured" tweet. Who cares about a $40m fine from an increasingly toothless regulator when your investors have already fronted $1.5 billion to settle copyright infringement claims?

https://www.bbc.com/news/articles/c5y4jpg922qo

[wookmaster]

A lot of companies are mandating token use, there's certainly a smell going on here but I have no idea why all the CEO's got onboard unless they all get some of that stock. AI psychosis is very real.

[simonw]

I think lying about their numbers now is risky if they're planning on an IPO this year - the real figures will come out in the S-1, and investors don't like untrustworthy companies.

Update: this inspired a note on my blog: https://simonwillison.net/2026/May/29/anthropic/

[SpicyLemonZest]

> (Also in Axios today is an anonymously sourced note that "An AI consultant tells Axios one of their clients recently spent half a billion dollars in a single month after failing to put usage limits on Claude licenses for employees" - times that by 12 and you get an extra $6 billion in annualized run-rate!)

This one client, then, is 12.8% of Anthropic's run-rate revenue? That does not exactly fill me with confidence that it's a meaningful number. Doesn't this suggest run-rate revenue will fall off a cliff if Anthropic customers start applying cost controls?

[vmbm]

Yeah, I think it is pretty obvious at this point that users have gotten over their skis a bit on the fixed rate plans. I suspect a lot of folks were playing around with agentic workflows on a $10-200/month plan and then started implementing them at their companies under enterprise accounts not realizing that API based billing would result in easily 10-100x the costs. Running hundreds of agents 24/7 is all fun and games when you can do it for beer money. Not as fun when it is super yacht money.

As an anecdote, Github is changing their copilot plan to usage based billing next month. They released a tool that allows their users to estimate what their bills will look like under the new plan based on their past usage. There are some screenshots online from users showing their plans will go from $40/month to $3-5k/month. I imagine this is happening everywhere. These tools absolutely can do more than they were capable of just six months ago. But if the true costs are as high as it appears, folks are going to be much more judicious with how they use them moving forward.

[256BitChris]

GitHub doesn't have access to its own models so it has to pay the prices of the model it uses.

People confuse price with cost all the time. The price of Opus has dropped from $75/1M output tokens to $25. That's the price. The cost is much lower and according to Dario, about a month ago, they had about a 73% margin.

I don't understand how anyone would use GitHub copilot...it's basically running a custom harness and using close to API pricing for Opus. This is why Microsoft is cooked in this game.

But yeah, I don't understand why people switch from subscription to API prices for Claude. They're way higher, but again that's price and not necessarily the cost to Anthropic to serve.

[vmbm]

For the longest time Copilot was the best deal in town. For $10 a month you would get ~1300 requests. A single prompt was counted as a request, and it didn't matter how many tokens were used or how many loops the agent did. It was a spectacular deal. Of course, now that they are moving to API based billing the plan is a not really a deal at all. The monthly plan is essentially pre-paying for API credits, which are use it or lose it and they are not discounted in any way.

And FYI, most enterprise accounts were forced to switch to a hybrid monthly seat license plus API based usage earlier this year. So that is why we are probably seeing so much alarm over Ai bills at the enterprise level. Companies went whole hog on agentic workflows not fully appreciating the costs structures of their new plans. Didn't help that pretty much every VC and board was probably breathing down their neck that if they didn't jump on the AI bandwagon they would get left behind.

[riffraff]

> according to Dario, about a month ago, they had about a 73% margin.

Do you have a source for this? I missed this and it does not match my impression.

[SatvikBeri]

Not OP, but Dario said on Dwarkesh's podcast 3 months ago that their gross margins are "significantly higher than 50%"

[Incipient]

I'm really annoyed at github for only allowing export of a single month of usage.

There were a lot of people (here included) that were absolutely abusing github - getting Opus to generate its own subagents for days on end with a single premium request. If THAT'S $3k/mo, I'm honestly not worried.

I was just asking sonnet, 5.4, opus, in single agent session to fix a problem for 20 minutes...if THAT'S $3k/mo, then AI is truly cooked.

[simonw]

I went digging and found this one - https://www.reddit.com/r/GithubCopilot/comments/1tbfkui/ill_... - billing $39.00, usage-based billing $5,851.77

[vmbm]

Yeah, I don't doubt that there was some abuse going on. But keep in mind there are plenty of reports out there that companies were setting up tokenmaxing leaderboards essentially encouraging this type of behavior from their employees. So I think the broader point here is that the insane growth that Anthropic has experienced over the last six months might be a temporary blip due to companies scrambling to take advantage of these more powerful agentic capabilities while not fully understanding the resulting costs.

I think for your use case, the most likely outcome is that you are going to need to be on a $100-200 month plan if you want access to the cutting edge models. But on the other end of the spectrum, you could probably get closer to $10-20 month using Chinese models. My usage was closer to yours, with the occasional tokenmaxxing sprint just to experiment a bit and test out the limits of the plan. I am not quite sure what I will be doing next month once it moves to API billing but I suspect I will move to openrouter and one of the open source CLI harnesses.

[simonw]

Maybe? We don't know if that Axios anonymous note is accurate, and we don't know how Anthropic are actually calculating annualized run-rate - I'm just guessing that they might be taking that monthly number x12.

If they really did count that one customer as $6B it means they've gone from $30B in April to a mere $41B in May.

[3ff]

lmao got him.

im really not sure why he keeps parroting on about this. its all irrelevant frankly. companies play games. non-gaap revenue recognition, adjusted operating income.... boo-ya.

wait for the somewhat official doc's to come out, then its worth talking about.

[shimman]

Yeah, until they release their S1 all numbers are highly suspect.

[xyzzyz]

How are they “not obligated to be truthful”? Lying to investors is literally a crime.

[mullingitover]

In 2026 what really even is financial crime, other than failing to grease the right palms?

[e9]

Private companies are not obligated to report GAAP numbers which means they can creatively twist numbers while still be truthful until they go public

[Zafira]

You need to think about this more creatively.

What we are talking about is entirely based on this one term in the announcement: run-rate revenue. This is a meaningless term just like how “clinically proven” for vitamins is a way for the companies to use weasel words to imply something without truly being able to back it up, but also not actually lying. There is no legal definition of “clinically proven” so, what exactly would you sue them for? The same thing is true for run-rate revenue. They can cherry pick numbers to use to generate the run-rate revenue value and they are not lying, but this isn’t exactly honest either. We have no transparency and run-rate revenue is not an accounting term.

This goes back to my entire point, this is a vibe. This announcement does not provide much in the way of substance, so a reader will take it to say whatever they want.

[shimman]

You need to give these people actual examples because rarely can they see the line between two dots. A great example of cooking the books is to do circular investments, adopt a bunch of users that are likely to churn, or to take your single "best" week of revenue then multiple it by 52. All things to over inflate the perceived value of an IPO.

IDK if these tricks would work anymore but then again fraud is legal now so who knows.

[foobiekr]

Are you familiar with Elon Musk's endless, repeated and obvious lies for the last decade?

[cookiengineer]

> How are they “not obligated to be truthful”? Lying to investors is literally a crime.

In the US?

Hahaha, that was a good one, buddy.

[crowcroft]

I mean, they're not a public company, but there are still laws that exist...