What Dylan Patel thinks about market efficiency

@dylan-patel · 50 positions · On ppll ↗

Founder and chief executive of SemiAnalysis, the research firm that tracks the semiconductor and AI data-centre supply chain.

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1 dated position, 2025, in their own words. Our reading of what Dylan Patel has said — not written or endorsed by them.

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1. 3 Feb 2025

   Our readingMost of the price gap between o1 and R1 is margin rather than efficiency: OpenAI's inference gross margins are north of 75% because nobody else could serve the capability.

   OpenAI

   Their wordsOpenAI has a fantastic margin. When they're doing inference, their gross margins are north of 75%. So that's a four to five X factor right there of the cost difference, is that OpenAI is just making crazy amounts of money because they're the only one with the capability.

   ↗DeepSeek, China, OpenAI, NVIDIA, xAI, TSMC, Stargate, and AI Megaclusters | Lex Fridman Podcast #459youtube.com 17th of 44 in this recording