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Cloud Growth Relies Heavily on Unprofitable AI Firms

Guavy AI Editorial Team
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Ed Zitron, CEO of EZ Primary Research, has sounded the alarm on the reliance of hyperscaler cloud growth on two unprofitable companies: OpenAI and Anthropic.

Zitron warns that this concentration poses sustainability risks, likening it to Enron. He notes that despite strong revenue growth and investment in cloud infrastructure by Google Cloud, Microsoft, and AWS, these losses could have a ripple effect.

OpenAI has reported significant losses, and its delayed IPO has raised eyebrows. Meanwhile, Anthropic is also struggling financially.

Zitron advises investors to closely monitor customer disclosures as hyperscalers continue their heavy capital spending through 2027.

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