AI Model Companies Allocate $35 to $40 of Every $100 in Revenue to Cloud Providers

Barclays Bank's latest AI industry report indicates that for every $100 in revenue generated by AI model companies, approximately $35 to $40 is directed towards major cloud providers such as Amazon Web Services (AWS), Microsoft Azure, and Google Cloud Platform (GCP) in the form of inference computing fees. Cloud providers can expect to earn about $10 to $20 in operating profit, corresponding to a profit margin of 35% to 45%. The report also mentions that the profit margin for paid inference services in AI labs is expected to significantly rise from the low double digits in 2025 to between 50% and 65% or even higher in 2026, with adjusted gross margins improving by 30 to 50 percentage points year-on-year. Barclays analysts predict that as competition among cutting-edge models intensifies and computing power supply increases, these high profit margins will gradually decline.

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