Frequently asked questions
Why track AI cost per user?
Because AI is a usage-based cost of goods sold, not a fixed expense. Traditional SaaS margins improve with scale; an AI app can see margins shrink if per-user token usage grows faster than price. Cost per user tells you whether each customer is actually profitable at your current pricing.
How do I improve AI gross margin?
Cut cost per user (smaller or cheaper models for easy requests, caching, batching, capping heavy usage) or raise price/usage limits. Watch power users and free tiers especially โ a small fraction of heavy users often drives most of the bill, so usage caps or tiered pricing protect the margin.