The State of the AI Economy

What it is — A data-driven look at the generative AI economy’s size and unit economics: $110B in trailing revenue, growing roughly 3x faster than the mobile or internet waves.

Key points

• Hyperscaler AI revenue is only just clearing infrastructure depreciation costs — the economics are narrowly sustainable, not yet profitable.
• Token price cuts don’t shrink spend: a 10% price drop drives 12-18% more tokens consumed, so total revenue keeps rising.
• Argues tokens alone are a poor value metric, and proposes “quality-adjusted output tokens” to better measure the intelligence actually being delivered.