Can OpenAI hold onto its AI dominance in 2026?
00:00 Speaker A
We continue our look at Yahoo Finance’s 2025 Company of the Year, OpenAI.
00:03 Speaker A
This initiative was part of nearly every conversation about AI business in 2025. It hasn’t even been released to the public yet.
00:10 Speaker A
Gabelli Funds portfolio manager John Belton joins us on what the next year could look like for Open AI and the public ecosystem around it, and AI more broadly.
00:19 Speaker A
John, thanks for being here. Thus, we chose OpenAI as the company of the year. It’s no surprise that artificial intelligence, like the one I just mentioned, is at the center of much of the debate.
00:29 Speaker A
So, will this play out more positively or negatively next year, given that some questions have been raised about this trade’s dependence on this company?
00:44 John Belton
Right. Yes. No, thank you for having me, Julie. I mean, OpenAI is one of the most, if not the most, companies in the AI space right now.
00:54 John Belton
What became clear this year are a few things. First, this company’s revenue trajectory is surprising. This is unprecedented. I think, you know, coming out of the year in the low single digit billion dollars, you know, approaching the $20 billion annual revenue rate, I think the latest statements.
01:09 John Belton
It currently has a user base approaching 900 million weekly active users. So, it’s really exciting growth.
01:16 John Belton
I think the reason why the market has become a little skittish is because of the size of the investment plans this company has put forward.
01:26 John Belton
They talk about more than a trillion dollars worth of infrastructure being built in the next few years. So it’s a really ambitious company with really strong growth, so yeah, it’s really important for the whole ecosystem.
01:36 Speaker A
John, at this point in investing in the AI thesis, how do you intend to do that at this stage of the game? I mean, you know, there’s also a lot of discussion going on where people are drawing parallels about the dotcom bubble, um, or other waves of technological innovation that we’ve seen in the past.
01:56 Speaker A
Often the winner you see at the beginning may not be the winner that emerges in the end, even if the technology itself is viable and important. So what do you think about this kind of question?
02:10 John Belton
Yes, I still think it’s very early in the evolution of this technology. I think there are few truly proven use cases for AI to date. I think they’re going to use AI in digital media, digital advertising, e-commerce businesses, cloud computing, and then LLM chatbots, which is a whole new field that’s already a pretty big industry.
02:39 John Belton
I think these are already pretty proven use cases.
02:42 John Belton
There’s another collection of use cases that I think are exciting; We’re starting to commercialize things like autonomous driving, robotics, agency software, there’s one more.
02:54 John Belton
And then there’s another kind of use case that we can think about for the future that’s still very early in development.
03:06 John Belton
That is, the use of artificial intelligence in life sciences, medical diagnosis, drug discovery and so on. So I think we’re still pretty early in terms of what role this technology will play in everything it can do.
03:24 John Belton
And from that perspective, I think, yes, companies involved in building infrastructure are still good places to go.
03:36 John Belton
We’ll need to see some of the future use cases begin to commercialize to ensure strong and consistent earnings growth, but what we’ve seen so far is certainly very, very encouraging.
03:48 Speaker A
And as you know, there was a lot of competition among the biggest of the LLMs. OpenAI isn’t alone, right? You’ve got Gemini kind of coming up. There are more Anthropics on the corporate side. As an investor, do you feel like you have to pick a side, so to speak, or do you still invest in some way?
04:09 John Belton
Yeah, I think in terms of basic model businesses, at least in the US, it looks like four or five companies are starting to separate themselves from the pack. You just mentioned Open AI and Gemini, I think you mentioned XAI and Anthropic and maybe the meta depending on what they come out with in early 2026.
04:35 John Belton
Um but, you know, I think there’s a lot of interest in the market in the short term, you know, the latest model releases and rankings, rankings on model capabilities. And I think it will be more fluid for a while.
04:51 John Belton
I think some models will specialize in certain areas and be best in some areas, while some models will be better in others. So yeah, I don’t think it’s a great way to choose a base model company today.
05:10 John Belton
But it seems like a few companies at the top are really starting to separate themselves from the pack, and given that this is a capital-intensive business, it’s probably going to be increasingly difficult for everyone else to keep up.
05:24 Speaker A
John, thank you very much. Appreciate it.
