OpenAI’s new AI video app, Sora, has rapidly gained millions of users but is costing the company up to $15 million daily due to the high computational expenses of generating short AI videos. Despite significant financial losses, OpenAI is pursuing this costly strategy to capture market share and hopes that increased adoption will eventually lead to reduced costs and higher revenues.
OpenAI, valued at around $500 billion, is reportedly spending up to $15 million per day on its new AI video creation app, Sora, according to Forbes. Despite generating an annual recurring revenue run rate of $20 billion, the company lost over $12 billion last quarter, highlighting the financial risks of its aggressive expansion. Sora, launched on September 30th for Apple’s iOS platform, quickly gained popularity with 1 million downloads in its first week and 4 million by Halloween. The app produces millions of 10-second AI-generated videos daily, ranging from humorous celebrity clips to bizarre home shopping ads.
The cost of running Sora is significantly higher than OpenAI’s text-based models like GPT-5 due to the complexity of video data, which involves processing four-dimensional information—three spatial dimensions plus time. Generating a single 10-second video clip costs OpenAI approximately $1.30 in GPU resources. This estimate is based on expert analysis considering GPU rental costs, processing time, and the computational intensity required for video generation. OpenAI charges users $1 for a standard Sora 2 video and $3 for the more advanced Sora 2 Pro model.
Forbes’ estimate of OpenAI’s daily spending on Sora is derived from assumptions about user activity. With 4.5 million app users, if 25% create an average of 10 videos per day, this results in about 11.3 million videos daily. Multiplying this by the $1.30 cost per video leads to an estimated daily expenditure of nearly $15 million, or $5.4 billion annually. This figure does not include videos that are discarded before posting due to content violations or drafts that consume credits but are never published.
OpenAI has not disclosed specific usage data or commented on Forbes’ financial estimates, so these numbers are based on external analysis and assumptions. The company’s strategy of offering free access to AI video generation is a bold move aimed at capturing market share and increasing visibility, despite the current unsustainable economics. OpenAI hopes that as more users adopt Sora, costs will decrease and revenue will eventually rise once paid access becomes the norm.
In summary, OpenAI’s Sora app represents a high-cost, high-risk investment in AI video technology. While it has attracted millions of users and generated significant buzz, the financial implications are substantial, with daily losses potentially reaching $15 million. The company is betting on long-term gains from market dominance and technological improvements, even as it navigates the challenges of scaling a costly and complex AI service. For more detailed coverage, Forbes’ Phoebe Lou provides an in-depth analysis of this evolving story.