AI Token Prices Hit Record Low of 97 Cents

The LLM Token Expenditure Index, which tracks daily artificial intelligence token prices, fell to 97 cents on Monday. This reading marks the lowest point since the index was established late last year and represents a decline of more than 50% from peaks seen during the summer.

Silicon Data reports that the price slide is driven by aggressive price cuts from frontier labs like OpenAI and increased competition from open-source Chinese models, including Moonshot's Kimi K3. While these lower costs benefit end users, they compress revenue for providers while compute costs remain fixed.

This deflationary trend creates profit pressures for companies such as OpenAI and Anthropic as they prepare for potential initial public offerings. Furthermore, the decline may force investors to reassess the return on capital for megacap technology firms, including Microsoft and Nvidia, which have invested billions of dollars into AI infrastructure.