Sora burned $1M/day before OpenAI pulled the plug

OpenAI's Sora lasted just six months as a public product. Launched in October 2025, the video generator peaked at ~1 million users before cratering — App Store downloads fell nearly 75% from their November high.

The core problem: Sora was burning roughly $1 million per day in compute costs with too little demand to justify it. Users called outputs "more AI slop than AI magic," and retention collapsed. OpenAI is now reallocating those chips toward a new internal model codenamed "Spud" and enterprise/coding products ahead of a rumored Q4 2026 IPO.

The fallout hit partnerships too. Disney — which had announced a ~$1B licensing deal to put Sora-created content on Disney+ — was notified less than an hour before the public shutdown announcement. The deal collapsed immediately.

Why it matters: Sora's shutdown is a reality check on AI hype cycles — even a flagship OpenAI product with a billion-dollar partnership can't survive if the unit economics don't work.