https://www.axios.com/2025/08/15/sam-altman-gpt5-launch-chat... quotes Sam Altman saying:
> Most of what we're building out at this point is the inference [...] We're profitable on inference. If we didn't pay for training, we'd be a very profitable company.
Which is like saying, “If all we did is charge people money and didn’t have any COGS, we’d be a very profitable company.” That’s a truism of every business and therefore basically meaningless.
I can't imagine the hoops an accountant would have to go through to argue training cost is COGS. In the most obvious stick-figures-for-beginners interpretation, as in, "If I had to explain how a P&L statement works to an AI engineer", training is R&D cost and inference cost is COGS.
I wasn’t using COGS in a GAAP sense, but rather as a synonym for unspecified “costs.” My bad. I suppose you would classify training as development and ongoing datacenter and GPU costs as actual GAAP COGS. My point was, if all you focus on is revenue and ignore the costs of creating your business and keeping it running, it’s pretty easy for any business to be “profitable.”