TECHNOLOGY / PRODUCT ECONOMICS

AI application profitability

Model AI app profit from paying users, token usage, caching, retries and operating costs. Find contribution per user and break-even customers.

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Your numbers

An average across paying users; excludes the extra attempts below.
Include system prompts, conversation history and other billed input.
Enter your provider's applicable rate in the selected currency; defaults are illustrative.
Use the applicable cached-input rate, not a discount percentage.
A share of input tokens, not a share of requests. Use 0 if caching is unavailable.
10 means 110 total attempts for 100 baseline requests. This is not a failure probability.
Average non-model cost incurred on every attempt, including retries.
Per-user costs not already included per attempt or as fixed costs.
Remain payable even with zero paying users.
This labels amounts; it does not convert between currencies.
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YOUR RESULT

Enter your numbers to see a result.

WORKED EXAMPLE

AI application profitability: a worked example

With paying users per month 1,000, monthly price per paying user 15, baseline requests per user per month 200, average input tokens per attempt 1,000, average output tokens per attempt 500, input price per million tokens 3, cached input price per million tokens 0.3, output price per million tokens 15, input tokens billed at cached rate (%) 50, extra attempts per 100 baseline requests 10, other cost per attempt 0.001, other monthly cost per paying user 1, fixed monthly operating costs 500, payment fee on subscription revenue (%) 3, the monthly operating profit is $10,817.00.

Inputs
Paying users per month1,000
Monthly price per paying user15
Baseline requests per user per month200
Average input tokens per attempt1,000
Average output tokens per attempt500
Input price per million tokens3
Cached input price per million tokens0.3
Output price per million tokens15
Input tokens billed at cached rate (%)50
Extra attempts per 100 baseline requests10
Other cost per attempt0.001
Other monthly cost per paying user1
Fixed monthly operating costs500
Payment fee on subscription revenue (%)3
Results
Monthly operating profit$10,817.00
Monthly revenue$15,000.00
Monthly model cost$2,013.00
Total monthly operating costs$4,183.00
Contribution per paying user$11.32
Break-even users45
Operating margin72.11%

Amounts are shown in US dollars for illustration. Choose your own currency in the calculator above; it labels amounts and does not convert them.

THE METHOD

How it works

Use monthly figures for paying users, subscription price, baseline requests and fixed costs. Enter average input and output tokens per attempt, including context you actually send, and use provider rates per million tokens in the same currency as your revenue. The cached percentage is the share of input tokens billed at the cached rate. Extra attempts add retry or repeated-call usage above baseline requests; 10% means 110 attempts for every 100 baseline requests. Every attempt incurs the entered model and other per-attempt costs. The result combines those costs, per-user costs, payment fees and fixed overheads to estimate operating profit and the user count needed to cover fixed costs.

FormulaAttempts/user = requests/user × (1 + extra attempts%/100). Weighted input rate = standard rate × (1 − cached share%/100) + cached rate × cached share%/100. Model cost/attempt = (input tokens × weighted input rate + output tokens × output rate) ÷ 1,000,000. Contribution/user = price × (1 − payment fee%/100) − attempts × (model cost/attempt + other cost/attempt) − other cost/user. Monthly profit = paying users × contribution − fixed costs. Break-even users = ceil(fixed costs ÷ contribution) when contribution is positive.
ASSUMPTIONS

Assumptions and limits

  • All users are paying monthly users with the same price and average usage. Free users, churn, refunds, tax and acquisition costs are excluded unless you allocate their costs to an entered field.
  • Baseline requests are multiplied by one plus extra attempts per 100 requests. All attempts use the same average token counts and incur all entered per-attempt costs.
  • Only input tokens receive the cached-input rate. The cached share is the fraction of input tokens billed at that rate; output tokens always use the output rate.
  • Rates are entered per million tokens. There is no built-in current model price list, automatic currency conversion, batch discount or separate cache-write/storage charge.
  • Other per-attempt, per-user and fixed costs are separate. Include any additional provider charges consistently and only once. The payment percentage applies to gross subscription revenue.
  • Break-even users requires positive contribution per paying user. Fixed costs remain payable at zero users, and operating margin is undefined at zero revenue.
  • Example rates are illustrative. Use one currency for subscription revenue, provider rates and every other cost.
  • Results are estimates based on the inputs and assumptions on this page, not professional advice.
  • Try this: in the example above, a 10% rise in “Monthly price per paying user” changes the result by +13.5% and a 10% rise in “Paying users per month” changes the result by +10.5%. Use “Save scenario A”, change one input and compare the two results side by side.
SOURCES

Official sources

QUESTIONS

Frequently asked questions

How is the result of the “AI application profitability” calculated?

Attempts/user = requests/user × (1 + extra attempts%/100). Weighted input rate = standard rate × (1 − cached share%/100) + cached rate × cached share%/100. Model cost/attempt = (input tokens × weighted input rate + output tokens × output rate) ÷ 1,000,000. Contribution/user = price × (1 − payment fee%/100) − attempts × (model cost/attempt + other cost/attempt) − other cost/user. Monthly profit = paying users × contribution − fixed costs. Break-even users = ceil(fixed costs ÷ contribution) when contribution is positive. Use monthly figures for paying users, subscription price, baseline requests and fixed costs. Enter average input and output tokens per attempt, including context you actually send, and use provider rates per million tokens in the same currency as your revenue. The cached percentage is the share of input tokens billed at the cached rate. Extra attempts add retry or repeated-call usage above baseline requests; 10% means 110 attempts for every 100 baseline requests. Every attempt incurs the entered model and other per-attempt costs. The result combines those costs, per-user costs, payment fees and fixed overheads to estimate operating profit and the user count needed to cover fixed costs.

What does the worked example show?

With paying users per month 1,000, monthly price per paying user 15, baseline requests per user per month 200, average input tokens per attempt 1,000, average output tokens per attempt 500, input price per million tokens 3, cached input price per million tokens 0.3, output price per million tokens 15, input tokens billed at cached rate (%) 50, extra attempts per 100 baseline requests 10, other cost per attempt 0.001, other monthly cost per paying user 1, fixed monthly operating costs 500, payment fee on subscription revenue (%) 3, the monthly operating profit is $10,817.00. Monthly revenue: $15,000.00; Monthly model cost: $2,013.00; Total monthly operating costs: $4,183.00; Contribution per paying user: $11.32; Break-even users: 45; Operating margin: 72.11%.

What assumptions and limits apply?

This is an estimate based on the inputs and assumptions shown on this page, not professional advice. Check anything with financial, health or safety consequences independently.

Is my data private?

Yes. Calculations run in your browser and your numbers are not sent to a server. A share link contains the inputs you choose to share, so check it before sending it to anyone.

Can I use my own currency?

Yes. Pick from 33 currencies and the amounts are labelled to match. The selector does not convert between currencies, so enter prices in your own currency.

How do I calculate profit for an AI subscription app?

Calculate revenue from paying users, then subtract model usage, other per-attempt and per-user costs, payment fees and fixed monthly costs. This calculator assumes a constant average usage level per user, so compare heavier-usage scenarios before relying on a single estimate.

What does the cached input percentage mean?

It is the share of input tokens billed at your entered cached-input rate. If half your input tokens use that rate, enter 50. It is not the percentage of requests with any cache hit. Output tokens keep their output rate, and separate cache-write or storage charges are not modelled automatically.

How are retries included?

The extra-attempts field adds attempts per 100 baseline requests. Entering 10 adds 10 extra attempts, giving 110 total. Every attempt incurs the same average tokens and other per-attempt cost. The field is not a failure probability and does not simulate repeated retries until success.

What does no positive contribution mean?

It means one paying user's net revenue does not exceed their variable costs under your inputs. Adding more identical users cannot generate a positive contribution to fixed costs. Try changing price, usage or costs, then inspect contribution per user again.

Are the token prices current provider prices?

No. All default rates are illustrative. Copy the applicable rates for your model, service tier and billing currency from your provider's current pricing documentation. Include all billed input and output tokens, and account separately for charges the model does not cover.

Does break-even include free users and customer acquisition?

Only costs you enter are included. The user count represents paying users. Allocate free-tier usage, acquisition spending and other costs to suitable per-user or fixed-cost fields if you want a broader estimate, taking care not to count a cost twice.

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