Sora, once hailed as the AI video generation revolution, has now officially become history. According to in-depth reports from multiple foreign media outlets, OpenAI quietly shut down the Sora service recently. This video generation tool, launched less than half a year ago, not only failed to sweep the consumer market as expected, but has instead become a heavy financial burden for the company: losing approximately $1 million per day, with total revenue for the entire service reaching only a few million dollars so far.
Sora’s Brilliant Rise and Rapid Fall
Going back two years, OpenAI first unveiled to the world the powerful capabilities of Sora: generating lifelike videos from text, with dreamlike scenes that seemed to come straight from Hayao Miyazaki’s fantastical worlds or the paintings of surrealist master Salvador Dalí. The technology’s debut in late 2023 sent shockwaves through the entire tech industry.
In September last year, OpenAI officially launched the standalone Sora app for consumers, with CEO Sam Altman comparing it to the significant moment when ChatGPT was first released. Altman had dreamed of positioning OpenAI as a creative pioneer in the AI era through Sora, bringing substantial new revenue streams for the company.
However, reality dealt him a heavy blow. According to data from AI research firm Similarweb, shortly after Sora’s launch, global user numbers peaked at around 1 million, but have never reached that figure again. In the following months, user numbers plummeted to under 500,000, nearly cut in half.
According to data from market intelligence firm Sensor Tower, the decline in downloads is even more pronounced. When Sora launched in October, global downloads were approximately 4.8 million, rising to 6.1 million in November, but then plummeting to 3.2 million in December, dropping to 2.1 million in January, 1.4 million in February, and just 1.1 million so far in March — not to mention the more capable alternative launched by ByteDance in early February. Seedance 2 This dealt an even heavier blow to Sora (Sora’s usage numbers started to plummet in February).
Burning Through Millions Daily: The Twin Predicament of Compute and Strategy
The fundamental reason for Sora’s failure lies in its extremely high operational costs. According to sources, Sora loses approximately $1 million per day, and because it’s offered free to all users, combined with the meager revenue from API access, it completely fails to achieve its break-even target.
More critically, OpenAI was only weeks away from completing a new AI model codenamed “Spud,” which was designed to support ChatGPT’s video generation capabilities. Unlike language models that learn from text, video models need to understand the entire dynamic world, making them far more expensive to create.
AI compute is the most valuable resource for any top research lab, and at OpenAI, Sora consumes an excessive amount of AI computing resources. Company executives have begun scrutinizing the return on investment for each project more rigorously ahead of the IPO, and the results show that Sora’s performance has fallen far short of expectations.
Heavy pressure from competitors
Sora faces increasingly fierce competition. According to Trevor Harries-Jones, a director at the Render Network Foundation, the innovation pace in the AI video generation industry is “staggering,” with numerous competitors from companies like Google and Kling.
“The problem is, if your model isn’t number one in any single field, it’s hard to get a large user base,” Harries-Jones points out. “Sora has gone from a very good start and has already been surpassed by other competitors. It doesn’t have a clear advantage.”
OpenAI Applications CEO Fidji Simo recently told employees: “We cannot afford to miss this moment by getting distracted by peripheral projects. We must make breakthroughs in productivity, especially commercial productivity.” The comments hint that the company will scale back projects like Sora.
Disney’s $1 Billion Investment Deal Falls Through
With Sora’s business hanging in the balance, OpenAI was on the verge of securing a massive investment from Disney. The two sides had announced a multi-year agreement last December, granting Disney licensing rights to over 200 characters from the company’s film library, including well-known IPs such as Marvel and Pixar. Disney also agreed to become OpenAI’s primary customer and invest $1 billion.
However, because OpenAI was about to shut down the Sora service, this $1 billion investment ultimately never materialized. According to reports, Disney executives only learned about this just a few hours before OpenAI was set to officially announce the discontinuation of Sora. They subsequently stated in a press release that they understood and respected OpenAI’s decision.
Shifting to AI Agents: OpenAI’s New Strategy
OpenAI’s decision to shut down Sora reflects the company’s significant shift in strategic focus ahead of its IPO. Altman described the decision as a difficult but necessary sacrifice for the company to achieve its larger goals. In a memo to employees, he wrote that he was encouraged to see everyone willing to make “difficult tradeoffs” for the company’s benefit.
Currently, OpenAI plans to shift its focus to a new “super app” the company is building, which will integrate so-called AI agent tools that can autonomously perform tasks for users, such as writing software, analyzing data, and booking travel. This type of productivity-focused product is gradually gaining widespread adoption in the labor market.
OpenAI is currently trailing behind competitor Anthropic in the race for this market, posing a threat to its leading position in the AI race. Altman told employees that the Sora team will next focus on longer-term strategic initiatives such as robotics. OpenAI spokesperson Kayla Wood said: “We have decided to discontinue the Sora consumer application and API. As we sharpen our focus and account for demand growth, the Sora research team will continue to focus on world simulation research, advancing robotics technology to help people solve real-world physical tasks.”
The Team’s Final Farewell
On Sora’s official X account, the team posted what reads like a digital obituary: “To everyone who used Sora to create, share, and build communities around it: thank you.” The product that was once filled with high hopes has come to an end.
We’re saying goodbye to the Sora app. To everyone who created with Sora, shared it, and built community around it: thank you. What you made with Sora mattered, and we know this news is disappointing.
We’ll share more soon, including timelines for the app and API and details on…
— Sora (@soraofficialapp) March 24, 2026
Behind all this lies a difficult choice about resource allocation, strategic direction, and market reality. For the AI industry, Sora’s story may just be one of many failure cases, but the question it reveals—how to balance bold innovation with commercial viability—is something all AI practitioners should deeply contemplate.
Source: KOCPC Chinese