Startups add ‘tokens burned’ to annual report after revenue and net loss

Venture-backed startups across the United States are adding a new line item to their annual reports, disclosing the number of A.I. tokens consumed alongside traditional financial metrics such as revenue, operating income and net loss. The move follows what one CFO described as “runaway prompt activity” among engineering teams over the past 18 months.

““We missed revenue guidance, but our Tokens Burned grew 640% quarter-over-quarter, which we view as a strong leading indicator of future hypothetical margin expansion,” said the finance chief of a Series C startup.”

In updated 10-K drafts reviewed by reporters, sections formerly titled “Key Operating Metrics” now list Monthly Active Users, Annual Recurring Revenue, and “Tokens Burned (Adjusted, Non-GAAP).” Several companies also include a reconciliations table, converting tokens burned into an estimated “Implied Productivity Units” based on internal formulas.

OpenAI and Anthropic both confirmed in separate statements that they are working with corporate finance teams to standardize how usage is reported to boards and investors. OpenAI has circulated a 47-page “Token Aware Finance” guide that recommends disclosing tokens burned per employee, per Jira ticket, and per Slack message containing the word “blocker,” according to an internal memo.

Technology workers say the new metric formalizes what has already become daily practice. “I don’t track hours anymore, I track tokens,” said a senior engineer at a cloud infrastructure startup, who reported consuming 12.4 million tokens during a single sprint, equivalent to “approximately eight meetings avoided,” according to his team’s retrospective notes.

Corporate IT departments, tasked with monitoring generative A.I. usage, have begun issuing monthly “Token Utilization Statements” to executives. At one Fortune 500 firm, employees collectively burned 3.2 billion tokens in January, a 1,900% increase year-on-year, while the company’s code deployment frequency rose by 2%, internal dashboards show.

CFOs are racing to interpret the new figures for investors. “We missed revenue guidance, but our Tokens Burned grew 640% quarter-over-quarter, which we view as a strong leading indicator of future hypothetical margin expansion,” said the finance chief of a Series C startup, noting that the company now tracks “Tokens Burned per Dollar of Net Loss” as a core efficiency metric.

Analysts at Morgan Stanley wrote in a recent note that tokens burned may soon join ARR and net dollar retention as a standard valuation lens for high-growth companies. Several venture funds are piloting “token-adjusted burn multiple” dashboards, and audit firms are exploring whether tokens can be recognized as an off-balance-sheet key performance indicator in 2025 filings, pending further guidance from regulators.

In anticipation of regulatory scrutiny, a consortium of large corporates and A.I. vendors is drafting a “Generally Accepted Token Metrics” framework, people familiar with the matter said. The group is expected to publish recommendations on token capitalization policies, impairment testing for poorly performing prompts, and best practices for disclosing prompt-engineering headcount in upcoming proxy statements.