Artificial revenues tied to two customers as AI pricing war threatens margins

How Anthropic’s Claude became an AI assistant for developers

The rise of humanity reflects the explosive growth of AI-powered software development. This has emerged as the first truly profitable use case for artificial intelligence beyond chatbots. The company currently leads 42% (over 21% share) of the code generation market, according to a comprehensive survey by 150 enterprise technical leader Menlo Ventures.

That advantage led to incredible financial performance. Sources close to the company say that even excluding the two biggest customers, the rest of humanity’s business has increased by more than 11 times compared to the previous year. The startup has also tripled the number of eight- and nine-digit transactions signed in 2024 in 2025. This reflects the wider recruitment of companies beyond coding locations.

Claude’s appeal to developers stems from his excellent performance on complex coding tasks. The newly released Claude Opus 4.1 won 74.5% on SWE-Bench Verified. This is 69.1% of Openai’s previous flagship models. Companies such as Windsurf, Cursor, and Github are celebrating Claude’s ability to handle multi-step coding issues and understand large codebases.

In a recent interview with VentureBeat, explaining the surge in AI-Assisted Development, he said, “People love writing code using models.

However, focusing on coding partnerships also creates strategic vulnerabilities. Microsoft-owned Github Copilot represents a particularly complicated relationship, given Microsoft’s $13 billion investment in Openai. This partnership relies on a substantial portion of revenue on the parent company of the same competitor, while humanity is needed to strengthen its competitor’s key products.

Openai fights back with an aggressive GPT-5 pricing strategy targeting humanity

With Openai’s GPT-5 launch this week, new variables have been introduced into Anthropic’s calculations. This is the advantage of dramatic pricing that allows you to reshape your company’s purchasing decisions. Early analysis shows that GPT-5 could provide comparable or superior performance at just a small fraction of Claude’s costs, undermining premium pricing that has driven rapid revenue growth for humanity.

This timing is particularly challenging as humanity is about to close a funding round that could potentially value the company for $170 billion. Investors may scrutinise both customer concentration and emerging price competition to assess whether humanity can maintain its growth trajectory.

The broader market dynamics support both optimism and concern for the future of mankind. Model API spending more than doubled to $8.4 billion in just six months, according to Menlo Ventures. This is because companies move from experimental projects to production deployment. Humanity has earned 32% of the use of large language models across the enterprise ahead of 25% for Openai and 20% for Google.

However, the same report reveals that companies will consistently prioritize performance over price and upgrade to the latest model within weeks of release, regardless of cost. This behavioral pattern suggests that the combination of improved performance and lower prices on the GPT-5 can lead to a rapid customer transition. This is truly a scenario that puts the concentration of human customers at a very risk.

Promoting humanity beyond coding into the enterprise market

Humanity is trying to diversify beyond coding applications and collaborates with leading pharmaceutical, retail, professional services and aviation companies. The European Parliament uses Claude, but large companies such as Pfizer, United Airlines and Thomson Reuters have become clients. The success of the startup includes legal AI company Harvey and cybersecurity company Base44.

The company’s inter-company revenue execution rate has increased 17 times compared to the previous year as of June, suggesting that the adoption of a wider range of companies is accelerating. Claude Code, a product focused on human developers, generates nearly $400 million annual revenue in just a few weeks, according to industry reports.

However, the coding market remains at the heart of human identity and growth strategies. The company has invested heavily in developer tools and recently launched an automated security review feature to address vulnerabilities in code generated by AI. Companies are increasingly relying on AI to arrive to write code faster than traditional security practices can handle.

“It really seems there’s a chance that over the next few years we’ll be able to increase the amount of code written worldwide by 10, 100, and 1,000 times,” Graham recently told VentureBeat. “The only way to catch up is to find a way to make it safe using the model itself.”

Anthropic Customer Focus Creates High Stakes Dependencies

Convergence of customer concentration and pricing places humanity at a strategic crossroads. The company will need to simultaneously defend its existing coding partnerships while expanding into new markets while potentially restructuring its pricing to stay competitive with the GPT-5.

The challenge goes beyond simple price matching. Humanity positions Claude as a premium product justified by its excellent performance and safety features. Dramatic price reductions can cause a wider industry price war, with no profits from anyone other than customers, and can at the same time undermining its position.

Additionally, customer focus in coding partnerships creates both leverage and vulnerability. While the cursor and Github co-pilot relationship provide a stable, large revenue stream, the fate of humanity means that providers are partially placed in the hands of relatively low friction companies.

GitHub relationships have proven particularly complicated given Microsoft’s competing interests. As Github Copilot becomes more successful, Microsoft will further strengthen the pressure to further integrate its own Openai partnership and potentially drive away humanity, despite the current performance benefits of Claude.

Industry observers should note that model switching costs remain relatively low, with 66% of companies upgrading within existing providers rather than switching vendors. However, the dramatic price differences introduced by the GPT-5 could overcome typical switching inertia, particularly for cost-oriented companies facing budgetary pressures.

War of Talent and Competitive Dynamics Reconstruct AI

The human customer focus challenge reflects the broader dynamics of reshaping the AI industry as competition grows more and more among frontier model developers. Openai’s aggressive GPT-5 pricing suggests a strategy to regain lost market share to humanity and other competitors, at the expense of short-term revenue.

This timing coincides with the unprecedented war on talent for AI companies, with Meta reportedly offering a $100 million signature bonus to key researchers. Humanity CEO Dario Amodei recently pointed out that many employees have rejected such offers and are maintaining a retention rate of 80% compared to 67% in Openai and 64% in Meta.

However, pricing pressure from GPT-5 could potentially help humanity accelerate its own talent investment and product development cycle, putting a strain on the company’s financial resources despite impressive revenue growth. The need to match Openai pricing while maintaining R&D spending can narrow down margins and complicate ongoing funding rounds.

Meanwhile, enterprise customers benefit from increasing competition through improved performance and reduced costs. The rapid pace of model improvements is a new version that launches monthly rather than annually, providing businesses with continuous improved features while vendors compete actively for their business.

For humanity, Path Forward requires careful navigation between protecting existing customer relationships and expanding the market scope while responding to Openai’s pricing attacks. The company’s ability to maintain leadership in the coding market while diversifying revenue streams could determine whether a prominent growth narrative about the risk of customer concentration in a rapidly evolving market will continue or become a cautionary tale.

Interests go beyond the fate of a single company. As AI-powered coding becomes the center of software development across the industry, the dynamics of humanity and Openai’s competitiveness shape how quickly artificial intelligence transforms one of the most important sectors of the economy. For now, the battleline is drawn based on price and performance, and companies retain their ultimate power and decide which AI assistants define the future of software development.

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