Sora AI Video Economics: $20 User Costs OpenAI $65 in Compute

Sora's Unit Economics

According to analysis of OpenAI's Sora AI video generation app, each $20/month subscriber generating 50 videos costs OpenAI approximately $65 in compute. The more users engaged with the product, the faster it lost money.

Cost Breakdown

• Peak compute costs: $15 million per day (analyst estimate)
• Total lifetime revenue: $2.1 million across all platforms over six months
• Conservative estimate: ~$1 million daily net burn rate after throttling and optimization
• Cost ratio: Generating 10-second AI video costs roughly 160 times more than equivalent text generation

Technical Details

Each 10-second video costs about $1.30 in GPU compute, requiring approximately 40 minutes of total GPU time across 4 H100s in parallel. At peak usage, with 25% of Sora's 4.5 million cumulative users publishing 10 videos daily, this resulted in 11.3 million videos per day at $1.30 each.

The structural cost issue stems from video's computational requirements: a 10-second 720p video requires processing roughly 80,000 small patches of pixels across space and time, compared to a few hundred tokens for typical ChatGPT prompts. Compute needs grow with the square of patch count - double the resolution quadruples the cost.

Market Context

No AI video company has proven net profitability according to the analysis. Runway reported -$155M EBITDA, Pika had $7.6M revenue on $80M raised, and while Kling reported $240M ARR, they haven't published profit data. Sora showed 1% day-30 retention versus TikTok's 32%, with users typically generating videos, watching them once, and not returning.