In a market increasingly populated by AI chatbot applications, ChatGPT, developed by OpenAI, has managed to capture significant user attention, as evidenced by its rising app installs and revenues. September broke records, tallying 15.6 million downloads and $4.6 million in gross revenue across iOS and Android platforms globally. However, a recent report from market intelligence firm Appfigures signals a deceleration in revenue growth, a potential red flag for the popular chatbot.
While ChatGPT’s mobile venture has been largely prosperous, Appfigures’ data indicates a slowdown in its revenue growth rate. The figures reveal that the rate of growth plummeted from 31 per cent in July and 39 per cent in August to 20 per cent in September. This could be an early indication of market saturation, particularly in relation to ChatGPT’s subscription service, ChatGPT+. The subscription, priced at $19.99 per month, offers users faster response times, priority during peak usage, and early access to new features.
ChatGPT may not hold the crown when it comes to profitability in the AI app arena. A competitor, Ask AI, outperformed ChatGPT in revenue, raking in $5.51 million in September compared to ChatGPT’s $4.6 million. Ask AI’s aggressive ad spending seems to have contributed to its edge in the market. However, net revenue might tell a different story, as ad expenditures could erode Ask AI’s profitability.
The platform distribution of ChatGPT’s downloads is another point of interest. Google Play led in September, contributing 9 million of the 15.6 million downloads. However, when it comes to revenue, the Apple App Store reigns supreme, generating $3 million of the total in-app purchases for the same period.
The United States continues to be the biggest market for ChatGPT, accounting for 60 per cent of its overall revenue. This geographic concentration suggests that while ChatGPT has a strong user base in the U.S., there might be untapped potential in international markets.
OpenAI has set an ambitious target to reach $1 billion in revenue by 2023. It remains to be seen whether ChatGPT can maintain its trajectory, especially given the high operating costs—each query is estimated to cost around 4 cents. Scalability and long-term sustainability are yet to be ascertained, particularly if ChatGPT aims to vie with major search engines in the future.
While ChatGPT has shown an impressive track record, its slightly decelerating growth could signify emerging challenges. Even though it has amassed a sizable user base, future growth could be stymied by market saturation and increasing competition. As the AI chatbot space gets more crowded, sustaining high growth rates may become more complex, even for a market leader like ChatGPT.
