> I don't think the "tokens consumed" metric was a very good one.
When mid or high level tech leadership pushes new things that look stupid from top-down they are either stupid or there are hidden incentives that regular people don't see. In my experience mid level usually matches with the former, and top level with the latter.
Opus 5.5 came out right at the end of the quarter, September 22. I'm confident that it caused more usage growth since then. I'm sure there are a lot of people rooting for their IPO to fail but they are still clearly in the lead on coding and will continue to do well until someone definitively passes them.
> they are still clearly in the lead on coding and will continue to do well until someone definitively passes them.
I think the first implying the second might be a bit of a stretch. At some point, companies are going to start looking at their AI spending and start negotiating deals. OpenAI is right behind them and Anthropic is around 8x more expensive (Sol 6.1 vs Opus 5.5 based on Artificial Intelligence's cost per task; cost per token is a somewhat useless metric when different models use vastly different numbers of tokens for the same thing). Chinese models like Deepseek 4.1 Flash are cheap, can be self-hosted, and while certainly behind Claude Opus 5.5, are still good.
Lots of companies buy "inferior" products like Microsoft Teams. Over the next 5 years, it seems likely that many models will get really good to the point that people often won't be able to tell any difference. Even if something isn't "definitively" better, companies might say "our engineers can't tell the difference and we're cutting our costs by 85%."
It's not absurd to think that a company would use its own harness or an open source harness and/or put a proxy in to route requests variably. For two months, they have engineers using different models unbeknownst to them and they measure things like how often the engineers have to correct or redirect the model. At the end of two months, they might find little difference in performance and switch to a much lower cost model.
It's not like it'd be crazy hard to analyze workers frustration as they did their jobs and figure out if one model was actually better. They could log all the conversations and it's not like AI can't easily determine things like "no, that's completely wrong" as a phrase showing that the agent was really off base.
I think a big part of the next 5-10 years is going to be about cost/efficiency.
I’m not sure it’s a binary thing that contradicts.
I want AI and these companies to succeed. And I especially want new companies to succeed. But I want them to be valued far more realistically. Because if they have to be worth trillions, then there’s a real motivation to do what it takes to realize that valuation. And that’s how you birth a Zuckerberg.
I’m not rooting for them to fail. I’m rooting for the correction to happen sooner than later.
> But I want them to be valued far more realistically.
They are. That's the problem. The obligations that these companies are, on paper, supposed to meet require these valuations.
If you value Anthropic at $500b that's still a fuckload and vastly less than their obligations and a lot of people are going to say "well wait a minute how am I going to get paid".
The amount of spend going on, and planned, is insane and underpins a lot of this, and is why people are skeptical of the valuations. It has nothing to do with "Wanting" AI to fail and just a reasonable bet based on the math. For them to pay back what they have on their balance sheet entire continents will functionally be a spec in comparison, and that's really really fucking unlikely to happen.
Doubly so when you consider that there's a question of if they can be profitable to projected needed levels without fundamentally breaking some economics parts, and that this looks a lot like the overbuild of the internet during the dotcom bubble, which was also hideously overvalued at the time, for the time frame they were looking at, despite being THE literal world changing tech.
> For them to pay back what they have on their balance sheet entire continents will functionally be a spec in comparison
Walk me through this math. I’m seeing $900bn Capex over a decade. That’s $90bn free cash flow a year, on average. If they can do 25% margins, that requires $360bn annual steady-state revenues. That doesn’t require continent-scale anything.
Anthropic can remove all access to their LLMs and start replicating entire software companies. Anyone relying on open weight models is at risk of a security breach from even slightly better models. It is ironic when people think Anthropic is the one without moat while they give all their data away.
As a counterpoint I haven't seen opus doing that much better than the latest gpt models? Astra is definitely comparable to fable and sol has been as good as opus for me. So this rings a bit anecdotal and that's probably what people will be seeing affect the growth trajectory too.
IMO Opus 5.5 has quietly been a revelation. It basically requires no hand holding from me given a sufficiently articulated prompt. At this point I'm limited by reviews and end-to-end validation of changes.
I’ve felt that way since the 4.1 releases. Opus 5.5 is a good model, especially after the disaster at the 4.7 mark.
But sol 6.1 is at least in the conversation as being as good and is much cheaper. I farm out bunches of my tasks to Luna and Haiku these days and have a working prototype of a glm 5.3 workflow at work that shows it being competitive.
The price pressure is very real and if you aren’t on a subscription then there is virtually no reason to pay the Anthropic premium
Are these two statements not at odds with each other? You can always say a prompt is not sufficiently articulated if you need to add additional handholding and vice versa, thereby invalidating any meaning of measurement.
No, because "sufficiently articulated" is relative to the model. Opus 5.5, often is "please handle this ticket someone assigned me, check this link it might be useful..."
With earlier models simply describing your desired end result often went poorly, and instead you had to break your prompt down into incremental steps. A single “sufficiently articulated“ prompt would result in the model forgetting about some of the things you told it to do by the time it got there.
Not due to capability per se, but writing style and polish is much worse.
It will leave really bad comments in the code, commit messages etc without strong explicit steering. Though I've basically moved away from having the model write any documentation at all.
It also tends to talk very circuitously and referencing things implicitly instead of just being direct and clear.
Certainly it's more capable in debugging, but I much prefer Astra over Sol now.
Of course, Astra has its own problems of code golfing everything. But at least it's very concise and direct
if you go on short form social media, Opus's ability to do agentic work in things like blender, css animation, etc. have spawned hundreds if not thousands of channels of people pumping out content with it. That and all the video game shenanigans (and now Anthropic is even modifying its system prompt to limit some of these things!)
There's definitely unique things that so far only Opus is capable of doing.
This is likely true, but doesn’t really tell us much about future revenue growth.
Now they need to compete on price, I think their revenue growth may start to look much more like typical Jevons paradox examples.
I.e as their usage grows exponentially their revenue grows linearly rather than exponentially as it was before.
I’m wondering whether Opus 5.5 would have caused growth in an absolute sense or just growth relative to competitors.
Anthropic’s market share is pretty high and there is not enough total currently addressed market for growth at the expense of a competitor to make a big long-term difference.
Well what I do know as someone who has a bird’s eye view into many enterprises is that many of them are starting to realize they’re bleeding money to Anthropic and are telling their teams to be more efficient with tokens.
Yeah there was a vibe shift towards OpenAI being much more competitive for daily use and then Opus 5.5 hit. Will be curious to look back and see if that shows in data. Of course, could change tomorrow.
I've been throwing opus 5.5 at problems I got stuck on with sonnet in the past and it has breezed through them all. It really reinforced how far the models have come.
> I'm sure there are a lot of people rooting for their IPO to fail but they are still clearly in the lead on coding and will continue to do well until someone definitively passes them.
Then why all the rush to IPO then?
The strongest chinese models from DeepSeek, Kimi and z.ai are already good enough to run for hours on most coding tasks cheaply.
For capital to win they need to get their money out of Anthropic before the bubble deflates. This means dumping the risk on retail. There is only a finite amount of money available to buy AI stock, and the SpaceX IPO sucked a lot up, so it's a fight between Anthropic and OpenAI who is going to get what's left. The loser is left without a chair to stand on when the music stops.
I have zero sense of this myself, am just curious, and not confident anyone really knows, but: I get that its a big deal for software developers when each new model comes out, because its perceived (correctly or not) as the next big boost for their productivity, but what about everyone else who is not a coder? Is there big reactions there to newer models? I don't know a single person who is not a engineer that would be able to tell me if "Astra" or "Opus" are Anthropic things or an OpenAI things respectively, much less when and what the big new version is for any of them. Does this play out for others? Or am I just in my own bubble for some reason?
What does average, non-computer Joe or Jane think when the next big model comes out? "My emails are going to be so much better now, I better stay subscribed"? "I can't wait to see how well it answers my questions"?
One more anecdote: People at our company are very excited for integration of existing industry specific tools and processes.
Some of them do require frontier models but many can do with localish models. Some of these processes (in our industry) are also not really limited by software at all but by the speed heavy machinery can be operated and/or manufactured and/or transported.
I'm certain LLMs are going to continue rapid growth even there but it may be an ideal field for have lesser models work for longer if it saves money in the end.
Of course who knows in the end. I'm certain there is a high chance of this being entirely wrong
I don't see the issue. If the market is saturated by them, the slowdown seems to indicate to me that it has reached (at least transiently) its intended audience. If the end goal is that every person on earth has a claude subscription (or whatever your choice is) then yeah that is worrying, but I don't deem that realistic.
> The real question is how many people haven't figured out how to use AI to make their job easier/more productive.
I think the answer, to a reasonable approximation, is “everyone”. Outside software engineering most people aren’t using it for anything useful, and I keep encountering technical people including programmers who don’t use it either, which never fails to surprise me.
One of my projects is a transportation management system (TMS) and of course I have added a lot of features to it including a very capable chat-based UI that can automate a lot of tedious data entry and other tasks for dispatchers and accounting and so on. It gets used but really not very much. I’m starting to realize that I’ve probably taken updates as far as they can go in terms of the ability of people to absorb change. Most people just carry on doing things the way they always have.
We had one person on the admin team who started using Cowork to automate all kinds of stuff. She loved it. Then she left. It hasn’t caught on with anyone else.
This is not to say that things won’t change but I think it will take a while.
I know firefighters and machinists heavily using it, the only places I see slower adoption is purely because of bad leadership- exclusivity contracts with certain providers or just plain fear.
We are capped by testing and PR review. The junior devs can spam out a million PRs a day but we keep having production incidents from not carefully scrutinising the changes. So the speed of code generation is limited by how fast we can actually accept those diffs.
Production incidents from not carefully scrutinizing changes is a sign that someone more senior should be putting infrastructure in place to minimize the impact of those incidents.
Feature flags, staggered rollouts, quick rollbacks, smoke testing, etc.
Sure, if you were hand managing every rollout up until now, and relied primarily on unit tests, you’re in for a world of hurt when you give a junior engineer Claude code and let em rip.
But if you have more advanced systems to measure and maintain overall service health, and codify your business logic invariants, you can really start flying these days as long as you’re all aligned on what to build and the potential impact.
That was always the issue... Rewrites were done before LLMs and the results were the same... There was never a point in time where the bottleneck was production of code, it was always review, testing, QA, fixing bugs and edge cases, and that is when only focusing on the technical part of delivery, and leaving out communication and synchronisation within the company and between company and clients...
How so? Or is this just vibes based analysis? I dont really know what you mean by classical engineering, but sure if something can be done on a computer it can infinite monkey theorem its way to a solution. This isnt exactly useful its just an enablement of laziness.
Idk how many people need to hear this, but not everything 'is computa',no matter what Trump says.
Much of the worlds problems are not verifiable with a compiler that can be trained or brute forced against.
Llms are not as useful as ya'll think they are, not everything exists in a web browser, which is why Anthropic et al have saturated their TAM and are now frantically hiring sales people to convince managers in other verticles.
Right, this is what astonishes me about the constant rhetoric/hyperbole about how this is going to impact "all the jobs" and make everyone wildly more productive than ever before. It's a fabulous tool in a limited number of areas, and it's otherwise only handy here and there. But just because it's a fabulous tool for the coding that is so prevalent among HN users does not mean that it's a fabulous tool for everything.
A hammer is fantastic for driving nails, but it's not really all that good at washing a dog.
This is conflating the benefits found within those areas with the ability of AI to actually deliver those things effectively across every single profession. Improving something by 2% vs. revolutionizing an entire industry are wholly different propositions. Maslow's hammer would like a word.
I've been saying it for a while now but if someone sold me a box with model perf from ... I guess November 2025 then that's decent enough for my usage. Tool interaction is the magic, I don't need much if any more innate intelligence. Things are fast enough.
I wonder if Anthropic will "see the light" and stop trying to burn a bunch of money and sell a thing they already have (which is decently useful). Very ready to be proven wrong in any direction
AI growth is unlikely to be linear. We have seen a lot of hype in the last 12-18 month that give us ideas like "tokenmaxxing". But this is the same cycle that we have been before: hype -> disillusionment -> someone figures out a better way to use it -> next hype phase starts.
As it stands, even the people closest to this technology have barely figured out how to use it effectively.
AI has historically had a habit of disappearing for ten years and coming back once memories fade and the new story sounds enough different from the old one.
I don’t think this era is going to end with us all unemployed, but I do plan to be retired before the next cycle.
For big ones it’s often network effects and/or friction. Those can be pretty good moats even with LLMs. These models are also nowhere near the point where they can actually reverse engineer complex products.
Network effects have subsequently been; shown to be logarithmic. You’re not getting 100x the benefit from 10x the users. You’re lucky to be getting 12x the benefit and you also have logarithmic increases in costs because there’s no such thing as economies of scale in software. You pay for every order of magnitude in hardware or software development costs.
i think its a lot deeper than that, compared to deepseek-4.1-flash, glm-5.3-flash and the recent minimax-m3.1-flash [0], the comparison in price (15x cheaper inference cost) and the productivity gains are very similar if not more profound depending your prompt topic (cyber, biochem, etc)
my simplified take is the headwind is on two ends - smaller models being sufficient enough & open weight models then second utility of 'a.i' is maximal when deployed with humans i.e engineers applying a.i on top of current applications putting an agent layer on top.
the second part is not sexy - but we see all a.i labs having fde arms e.g ode, microsoft frontier company etc but then again that's the part you can't hype.
Right, but a comparison is always one more implicit derivative. If you look at revenue itself, it's growing or shrinking, that's first derivative. So there's one more derivative here than usual?
I guess the interesting thing would be to look at actual company assets/value rather than revenue; revenue already in itself is a derivative. I.e., contrast their revenue against expenses. Last I heard those numbers are deep red, aren't they?
Growth is first derivative. Deceleration is second derivative. Focusing on second not first I think was the point, not implying there is some nth derivative under discussion.
The conclusion that this is a bubble seems arbitrary and disconnected from the several true facts outlined in the article. Anthropic's growth _is_ slowing, albeit still strong at ~47%. They do have enormous compute obligations, and it will require a lot of growth to meet them. However, they also increased revenue per dollar spent on compute from $0.40 to $2.08 in five quarters and hold $131.7bn in cash.
Keep in mind this growth has mostly been sustained by low-level business automations, coding, and chatbots. With the adoption of products like personal agents, e.g., Meta's Muse, I am pretty optimistic there will be demand and growth around this level will be sustained for a few quarters. Doubtful we will ever see another ~150% growth quarter.
Their financial statements suggest the answer, even when you take into account the cost of training the model, is 'not at all'. They are profitable, the main questions for their valuation are 1) can they keep their margins, 2) how big can they grow?, and 3) can this growth match what they have committed to?
The subscriptions are a key part of the engine to ensure The Machine can keep improving itself by harvesting all that data and feeding it back in. Many of the enterprise contracts forbid the lab from training on their data, so the subscriptions are a form of gold.
Ah the beauty of circular financing. By owning the company who pays me to provide a service, I stand to gain massively by giving them a discount, making them look profitable, and fooling investors in to providing my exit liquidity.
If you ever wonder why Anthropic is going all out to try and fearmonger their way to an open weights ban, this graph will provide all the answer you need.
- Would you like to get paid a million dollars right now, or get paid a penny today that doubles everyday for 30 days.
- hmmm, why 30 days? Make it 60 days and I'll take the penny.
The effort needed to double everyday, or month is realistic at first. But then you can't just keep doubling without swallowing the universe along the way.
I think one thing that could explain it is that some of the big tech companies might have been big customers of theirs, and now they have alternatives that, according to recent news, their employees are being pushed to use instead. Some of those reports mentioned internal usage getting cut in half. If this is true, it doesn't necessarily mean their growth has stalled.
Employees were and are pushing for more model and harness diversity too I promise.
But perhaps for different reasons than Microsoft, Meta, and maybe Adobe leadership are now. See, if they are all in on Claude how do they sue Anthropic for assisting in copyright violations and IP theft? The services would be cut immediately.
Well when they don't need them anymore..
This is why Anthropic is heaping on more and more model restrictions running up to IPO. I believe it's a smokescreen for the IP risk they outlined in their IPO filing..
1) customer concentration risk
2) when those customers use a diverse set of models - so too will the rest - they’re not idiots who want to pay more than they should
Aka % growth rate decreasing sharply and eventually flattening out. Within 2-3 quarters.
Everyone is really tightening usage now because of all the slopmaxers who burned millions of dollars of tokens and achieved nothing.
[delayed]
People tend to do wonderfully at whatever metric they're judged by. I don't think the "tokens consumed" metric was a very good one.
> I don't think the "tokens consumed" metric was a very good one.
When mid or high level tech leadership pushes new things that look stupid from top-down they are either stupid or there are hidden incentives that regular people don't see. In my experience mid level usually matches with the former, and top level with the latter.
What did they think was going to happen? Lots of people predicted exactly this progression of events.
Slop is a side effect for anyone using it at scale it seems.
Opus 5.5 came out right at the end of the quarter, September 22. I'm confident that it caused more usage growth since then. I'm sure there are a lot of people rooting for their IPO to fail but they are still clearly in the lead on coding and will continue to do well until someone definitively passes them.
> they are still clearly in the lead on coding and will continue to do well until someone definitively passes them.
I think the first implying the second might be a bit of a stretch. At some point, companies are going to start looking at their AI spending and start negotiating deals. OpenAI is right behind them and Anthropic is around 8x more expensive (Sol 6.1 vs Opus 5.5 based on Artificial Intelligence's cost per task; cost per token is a somewhat useless metric when different models use vastly different numbers of tokens for the same thing). Chinese models like Deepseek 4.1 Flash are cheap, can be self-hosted, and while certainly behind Claude Opus 5.5, are still good.
Lots of companies buy "inferior" products like Microsoft Teams. Over the next 5 years, it seems likely that many models will get really good to the point that people often won't be able to tell any difference. Even if something isn't "definitively" better, companies might say "our engineers can't tell the difference and we're cutting our costs by 85%."
It's not absurd to think that a company would use its own harness or an open source harness and/or put a proxy in to route requests variably. For two months, they have engineers using different models unbeknownst to them and they measure things like how often the engineers have to correct or redirect the model. At the end of two months, they might find little difference in performance and switch to a much lower cost model.
It's not like it'd be crazy hard to analyze workers frustration as they did their jobs and figure out if one model was actually better. They could log all the conversations and it's not like AI can't easily determine things like "no, that's completely wrong" as a phrase showing that the agent was really off base.
I think a big part of the next 5-10 years is going to be about cost/efficiency.
I’m not sure it’s a binary thing that contradicts.
I want AI and these companies to succeed. And I especially want new companies to succeed. But I want them to be valued far more realistically. Because if they have to be worth trillions, then there’s a real motivation to do what it takes to realize that valuation. And that’s how you birth a Zuckerberg.
I’m not rooting for them to fail. I’m rooting for the correction to happen sooner than later.
> But I want them to be valued far more realistically.
They are. That's the problem. The obligations that these companies are, on paper, supposed to meet require these valuations.
If you value Anthropic at $500b that's still a fuckload and vastly less than their obligations and a lot of people are going to say "well wait a minute how am I going to get paid".
The amount of spend going on, and planned, is insane and underpins a lot of this, and is why people are skeptical of the valuations. It has nothing to do with "Wanting" AI to fail and just a reasonable bet based on the math. For them to pay back what they have on their balance sheet entire continents will functionally be a spec in comparison, and that's really really fucking unlikely to happen.
Doubly so when you consider that there's a question of if they can be profitable to projected needed levels without fundamentally breaking some economics parts, and that this looks a lot like the overbuild of the internet during the dotcom bubble, which was also hideously overvalued at the time, for the time frame they were looking at, despite being THE literal world changing tech.
> For them to pay back what they have on their balance sheet entire continents will functionally be a spec in comparison
Walk me through this math. I’m seeing $900bn Capex over a decade. That’s $90bn free cash flow a year, on average. If they can do 25% margins, that requires $360bn annual steady-state revenues. That doesn’t require continent-scale anything.
Anthropic can remove all access to their LLMs and start replicating entire software companies. Anyone relying on open weight models is at risk of a security breach from even slightly better models. It is ironic when people think Anthropic is the one without moat while they give all their data away.
As a counterpoint I haven't seen opus doing that much better than the latest gpt models? Astra is definitely comparable to fable and sol has been as good as opus for me. So this rings a bit anecdotal and that's probably what people will be seeing affect the growth trajectory too.
IMO Opus 5.5 has quietly been a revelation. It basically requires no hand holding from me given a sufficiently articulated prompt. At this point I'm limited by reviews and end-to-end validation of changes.
I’ve felt that way since the 4.1 releases. Opus 5.5 is a good model, especially after the disaster at the 4.7 mark.
But sol 6.1 is at least in the conversation as being as good and is much cheaper. I farm out bunches of my tasks to Luna and Haiku these days and have a working prototype of a glm 5.3 workflow at work that shows it being competitive.
The price pressure is very real and if you aren’t on a subscription then there is virtually no reason to pay the Anthropic premium
> It basically requires no hand holding from me
> given a sufficiently articulated prompt
Are these two statements not at odds with each other? You can always say a prompt is not sufficiently articulated if you need to add additional handholding and vice versa, thereby invalidating any meaning of measurement.
No, because "sufficiently articulated" is relative to the model. Opus 5.5, often is "please handle this ticket someone assigned me, check this link it might be useful..."
With earlier models simply describing your desired end result often went poorly, and instead you had to break your prompt down into incremental steps. A single “sufficiently articulated“ prompt would result in the model forgetting about some of the things you told it to do by the time it got there.
I've found Sol 6.1 a regression over 5.6.
Not due to capability per se, but writing style and polish is much worse.
It will leave really bad comments in the code, commit messages etc without strong explicit steering. Though I've basically moved away from having the model write any documentation at all.
It also tends to talk very circuitously and referencing things implicitly instead of just being direct and clear.
Certainly it's more capable in debugging, but I much prefer Astra over Sol now.
Of course, Astra has its own problems of code golfing everything. But at least it's very concise and direct
if you go on short form social media, Opus's ability to do agentic work in things like blender, css animation, etc. have spawned hundreds if not thousands of channels of people pumping out content with it. That and all the video game shenanigans (and now Anthropic is even modifying its system prompt to limit some of these things!)
There's definitely unique things that so far only Opus is capable of doing.
Sol 6.1 is definitely not comparable to Opus 5.5 for me.
This is likely true, but doesn’t really tell us much about future revenue growth. Now they need to compete on price, I think their revenue growth may start to look much more like typical Jevons paradox examples. I.e as their usage grows exponentially their revenue grows linearly rather than exponentially as it was before.
I’m wondering whether Opus 5.5 would have caused growth in an absolute sense or just growth relative to competitors.
Anthropic’s market share is pretty high and there is not enough total currently addressed market for growth at the expense of a competitor to make a big long-term difference.
Well what I do know as someone who has a bird’s eye view into many enterprises is that many of them are starting to realize they’re bleeding money to Anthropic and are telling their teams to be more efficient with tokens.
Yeah there was a vibe shift towards OpenAI being much more competitive for daily use and then Opus 5.5 hit. Will be curious to look back and see if that shows in data. Of course, could change tomorrow.
I've been throwing opus 5.5 at problems I got stuck on with sonnet in the past and it has breezed through them all. It really reinforced how far the models have come.
Wouldn’t previous Opus models be able to solve them too? In my experience Sonnet is often lackluster.
> I'm sure there are a lot of people rooting for their IPO to fail but they are still clearly in the lead on coding and will continue to do well until someone definitively passes them.
Then why all the rush to IPO then?
The strongest chinese models from DeepSeek, Kimi and z.ai are already good enough to run for hours on most coding tasks cheaply.
For capital to win they need to get their money out of Anthropic before the bubble deflates. This means dumping the risk on retail. There is only a finite amount of money available to buy AI stock, and the SpaceX IPO sucked a lot up, so it's a fight between Anthropic and OpenAI who is going to get what's left. The loser is left without a chair to stand on when the music stops.
[dead]
I have zero sense of this myself, am just curious, and not confident anyone really knows, but: I get that its a big deal for software developers when each new model comes out, because its perceived (correctly or not) as the next big boost for their productivity, but what about everyone else who is not a coder? Is there big reactions there to newer models? I don't know a single person who is not a engineer that would be able to tell me if "Astra" or "Opus" are Anthropic things or an OpenAI things respectively, much less when and what the big new version is for any of them. Does this play out for others? Or am I just in my own bubble for some reason?
What does average, non-computer Joe or Jane think when the next big model comes out? "My emails are going to be so much better now, I better stay subscribed"? "I can't wait to see how well it answers my questions"?
One more anecdote: People at our company are very excited for integration of existing industry specific tools and processes.
Some of them do require frontier models but many can do with localish models. Some of these processes (in our industry) are also not really limited by software at all but by the speed heavy machinery can be operated and/or manufactured and/or transported.
I'm certain LLMs are going to continue rapid growth even there but it may be an ideal field for have lesser models work for longer if it saves money in the end.
Of course who knows in the end. I'm certain there is a high chance of this being entirely wrong
I don't see the issue. If the market is saturated by them, the slowdown seems to indicate to me that it has reached (at least transiently) its intended audience. If the end goal is that every person on earth has a claude subscription (or whatever your choice is) then yeah that is worrying, but I don't deem that realistic.
They need a lot more growth just to afford the compute they've already agreed to buy. Not to mention to justify their rumored record-high IPO price.
No one with a brain does, but Anthropic’s valuation is banking on massive sustained growth to pay their bills.
The real question is how many people haven't figured out how to use AI to make their job easier/more productive.
Especially with this latest crop of models, they seem to be pretty damn competent in classic engineering rather than just software engineering.
> The real question is how many people haven't figured out how to use AI to make their job easier/more productive.
I think the answer, to a reasonable approximation, is “everyone”. Outside software engineering most people aren’t using it for anything useful, and I keep encountering technical people including programmers who don’t use it either, which never fails to surprise me.
One of my projects is a transportation management system (TMS) and of course I have added a lot of features to it including a very capable chat-based UI that can automate a lot of tedious data entry and other tasks for dispatchers and accounting and so on. It gets used but really not very much. I’m starting to realize that I’ve probably taken updates as far as they can go in terms of the ability of people to absorb change. Most people just carry on doing things the way they always have.
We had one person on the admin team who started using Cowork to automate all kinds of stuff. She loved it. Then she left. It hasn’t caught on with anyone else.
This is not to say that things won’t change but I think it will take a while.
I know firefighters and machinists heavily using it, the only places I see slower adoption is purely because of bad leadership- exclusivity contracts with certain providers or just plain fear.
A lot of people have jobs that aren't limited by how much "stuff" they generate.
We are capped by testing and PR review. The junior devs can spam out a million PRs a day but we keep having production incidents from not carefully scrutinising the changes. So the speed of code generation is limited by how fast we can actually accept those diffs.
Production incidents from not carefully scrutinizing changes is a sign that someone more senior should be putting infrastructure in place to minimize the impact of those incidents.
Feature flags, staggered rollouts, quick rollbacks, smoke testing, etc.
Sure, if you were hand managing every rollout up until now, and relied primarily on unit tests, you’re in for a world of hurt when you give a junior engineer Claude code and let em rip.
But if you have more advanced systems to measure and maintain overall service health, and codify your business logic invariants, you can really start flying these days as long as you’re all aligned on what to build and the potential impact.
Don’t forget requirements gathering and design. There’s only so fast the business side can feed requests into us.
The business side will step up their token output.
Haven’t you heard, Anthropic uses Claude for all of its PR reviews and has no issues at all!
Unfortunately I work with users who get upset when the app goes down or features break.
That was always the issue... Rewrites were done before LLMs and the results were the same... There was never a point in time where the bottleneck was production of code, it was always review, testing, QA, fixing bugs and edge cases, and that is when only focusing on the technical part of delivery, and leaving out communication and synchronisation within the company and between company and clients...
How so? Or is this just vibes based analysis? I dont really know what you mean by classical engineering, but sure if something can be done on a computer it can infinite monkey theorem its way to a solution. This isnt exactly useful its just an enablement of laziness.
Idk how many people need to hear this, but not everything 'is computa',no matter what Trump says.
Much of the worlds problems are not verifiable with a compiler that can be trained or brute forced against.
Llms are not as useful as ya'll think they are, not everything exists in a web browser, which is why Anthropic et al have saturated their TAM and are now frantically hiring sales people to convince managers in other verticles.
Turns out most people dont need or want AI.
Right, this is what astonishes me about the constant rhetoric/hyperbole about how this is going to impact "all the jobs" and make everyone wildly more productive than ever before. It's a fabulous tool in a limited number of areas, and it's otherwise only handy here and there. But just because it's a fabulous tool for the coding that is so prevalent among HN users does not mean that it's a fabulous tool for everything.
A hammer is fantastic for driving nails, but it's not really all that good at washing a dog.
Name a single job that can't be improved with better communication, planning, or insight.
This is conflating the benefits found within those areas with the ability of AI to actually deliver those things effectively across every single profession. Improving something by 2% vs. revolutionizing an entire industry are wholly different propositions. Maslow's hammer would like a word.
Vibes based analysis is very high volume right now due to upcoming IPOs.
And how much of that is astroturfing, one should ask.
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On HN, can you please not be snarky? We're trying for something a bit different than internet mean here.
The idea is: if you have a substantive point, make it thoughtfully; if not, please don't comment until you do.
https://news.ycombinator.com/newsguidelines.html
It's fun to note that nobody mentions AGI in these threads anymore.
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OpenAI's Astra released on Sept 3 and Opus 5.5 released on Sept 22.
Most likely the combined revenue growth continued just as fast, but OpenAI took a lot of market share with a model that's ~as good.
If true, then the current market sentiment is too pessimistic because demand for AI (and chips) has continued growing.
I've been saying it for a while now but if someone sold me a box with model perf from ... I guess November 2025 then that's decent enough for my usage. Tool interaction is the magic, I don't need much if any more innate intelligence. Things are fast enough.
I wonder if Anthropic will "see the light" and stop trying to burn a bunch of money and sell a thing they already have (which is decently useful). Very ready to be proven wrong in any direction
AI growth is unlikely to be linear. We have seen a lot of hype in the last 12-18 month that give us ideas like "tokenmaxxing". But this is the same cycle that we have been before: hype -> disillusionment -> someone figures out a better way to use it -> next hype phase starts.
As it stands, even the people closest to this technology have barely figured out how to use it effectively.
Sometimes it's just Hype -> disillusionment, and then no one ever figures out a better way and it's dead technology.
Not saying that applies to AI, but it certainly applies sometimes.
I can hear the landfill full of those 3D glasses for home TVs shout in agreement
It's really hard to bring everything there on my Segway, which is of course the only type of vehicle on the roads anymore.
Plus all the blockchains.
AI has historically had a habit of disappearing for ten years and coming back once memories fade and the new story sounds enough different from the old one.
I don’t think this era is going to end with us all unemployed, but I do plan to be retired before the next cycle.
As an investor, what's the moat here? Being 6 months ahead of China's open source/weight models?
What is the moat of any tech company if they are using LLMs to build their products which can also be reverse engineered by an LLM? Hardware?
For big ones it’s often network effects and/or friction. Those can be pretty good moats even with LLMs. These models are also nowhere near the point where they can actually reverse engineer complex products.
Network effects have subsequently been; shown to be logarithmic. You’re not getting 100x the benefit from 10x the users. You’re lucky to be getting 12x the benefit and you also have logarithmic increases in costs because there’s no such thing as economies of scale in software. You pay for every order of magnitude in hardware or software development costs.
decent software stack that works out of the box.
You can go very far in life with a thing that isn't futzy
Having compute to serve the demand.
I feel like a lot of this could be explained by how good Opus 5.5 is compared to Fable. People don’t need Fable for most tasks.
Opus 5.5 is basically not included in this data.
They'll be competing on price now with openAI, google, and Amazon eventually.
AI is just a compute commodity with a value add.
Are any of the AI companies selling their services at a profit or are we all being subsidized by investor money that is about to need to be paid back?
Anthropic and OpenAI own no compute. Amazon has no models.
So that leaves...
They can't keep getting away with it.
Amazon hosts models. And?
Amazon has to pay ~70% revenue share on models they host.
i think its a lot deeper than that, compared to deepseek-4.1-flash, glm-5.3-flash and the recent minimax-m3.1-flash [0], the comparison in price (15x cheaper inference cost) and the productivity gains are very similar if not more profound depending your prompt topic (cyber, biochem, etc)
[0] https://x.com/jumperz/status/2112226308868436154
my simplified take is the headwind is on two ends - smaller models being sufficient enough & open weight models then second utility of 'a.i' is maximal when deployed with humans i.e engineers applying a.i on top of current applications putting an agent layer on top.
the second part is not sexy - but we see all a.i labs having fde arms e.g ode, microsoft frontier company etc but then again that's the part you can't hype.
I thought growth has slowed due to crackdown on distillation
They said distillation was 5-7% of revenue. The slowdown is much larger than that.
And what is between June and September?
You can tell how desperate an argument is by how many derivatives they are using.
Growth being the first derivative… so… not particularly desperate?
Their growth was positive. The second derivative (growth of their growth) was likely negative, and that's what this article is about.
Right, but a comparison is always one more implicit derivative. If you look at revenue itself, it's growing or shrinking, that's first derivative. So there's one more derivative here than usual?
I guess the interesting thing would be to look at actual company assets/value rather than revenue; revenue already in itself is a derivative. I.e., contrast their revenue against expenses. Last I heard those numbers are deep red, aren't they?
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Growth is first derivative. Deceleration is second derivative. Focusing on second not first I think was the point, not implying there is some nth derivative under discussion.
Winning an argument online 101: call your opponent desperate.
when politicians and bankers talk about "reducing inflation" they use the same derivative
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DRAM ...
The conclusion that this is a bubble seems arbitrary and disconnected from the several true facts outlined in the article. Anthropic's growth _is_ slowing, albeit still strong at ~47%. They do have enormous compute obligations, and it will require a lot of growth to meet them. However, they also increased revenue per dollar spent on compute from $0.40 to $2.08 in five quarters and hold $131.7bn in cash.
Keep in mind this growth has mostly been sustained by low-level business automations, coding, and chatbots. With the adoption of products like personal agents, e.g., Meta's Muse, I am pretty optimistic there will be demand and growth around this level will be sustained for a few quarters. Doubtful we will ever see another ~150% growth quarter.
I think all numbers coming out of Anthropic are utterly meaningless until we can answer the question of "just how subsidized are those subscriptions?"
Their financial statements suggest the answer, even when you take into account the cost of training the model, is 'not at all'. They are profitable, the main questions for their valuation are 1) can they keep their margins, 2) how big can they grow?, and 3) can this growth match what they have committed to?
The subscriptions are a key part of the engine to ensure The Machine can keep improving itself by harvesting all that data and feeding it back in. Many of the enterprise contracts forbid the lab from training on their data, so the subscriptions are a form of gold.
The subscriptions do not require training on your data.
The contracts might, but do they pink promise?
The company was founded under the principle they will violate laws to acquire training material
> all numbers coming out of Anthropic are utterly meaningless until we can answer the question of "just how subsidized are those subscriptions?"
Subscriptions are a growing minority of revenue.
Doesn't their S-1 render this irrelevant? Their financials are clearly much better than we thought
their gross margins point at this not being an issue.
Ah the beauty of circular financing. By owning the company who pays me to provide a service, I stand to gain massively by giving them a discount, making them look profitable, and fooling investors in to providing my exit liquidity.
Which of Anthropic’s revenues are circularly financed?
If you ever wonder why Anthropic is going all out to try and fearmonger their way to an open weights ban, this graph will provide all the answer you need.
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Anyway the growth this year is incredulous!
Growth is conscious now? or what do you mean?
Huh? They provide a service that does something that did not work before and now does and was quickly adopted. They do not have a moat.
I am just imagining Anthropic (and OpenAI) employees reading these comments and laughing at the rank ignorance of the commentariat.
I agree, share you system prompt here so I can mark this as a success.
Zitron has been saying this for months.
Years, no? Meaning the sky is falling rhetoric was wrong for a long time. He will get lucky eventually.
This data only leaked two weeks ago. Zitron is a stopped clock.
Zitron is not a serious person
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- Would you like to get paid a million dollars right now, or get paid a penny today that doubles everyday for 30 days.
- hmmm, why 30 days? Make it 60 days and I'll take the penny.
The effort needed to double everyday, or month is realistic at first. But then you can't just keep doubling without swallowing the universe along the way.
The answer is ~5 million in case you’re curious how much the penny is worth after 30 days of doubling.
~5 quadrillion after 60
I think one thing that could explain it is that some of the big tech companies might have been big customers of theirs, and now they have alternatives that, according to recent news, their employees are being pushed to use instead. Some of those reports mentioned internal usage getting cut in half. If this is true, it doesn't necessarily mean their growth has stalled.
Discussed here a few weeks ago: https://news.ycombinator.com/item?id=49997161
Employees were and are pushing for more model and harness diversity too I promise.
But perhaps for different reasons than Microsoft, Meta, and maybe Adobe leadership are now. See, if they are all in on Claude how do they sue Anthropic for assisting in copyright violations and IP theft? The services would be cut immediately.
Well when they don't need them anymore..
This is why Anthropic is heaping on more and more model restrictions running up to IPO. I believe it's a smokescreen for the IP risk they outlined in their IPO filing..
The mental gymanaatics here is crazy
1) customer concentration risk 2) when those customers use a diverse set of models - so too will the rest - they’re not idiots who want to pay more than they should
Aka % growth rate decreasing sharply and eventually flattening out. Within 2-3 quarters.
Understood?