How did Arora describe OpenAI's new model efficiency?

He described it as 'a good start' but insufficient.

Which company does Nikesh Arora lead?

He leads Palo Alto Networks (PANW), a cybersecurity firm.

Why is reducing AI token costs important for Palo Alto Networks?

The company integrates AI into its products; lower costs improve profit margins and competitiveness.

Palo Alto CEO: AI Token Costs Must Fall 90%

Nikesh Arora, CEO of Palo Alto Networks (PANW), called for a 90% reduction in AI token costs over the next two years, describing OpenAI's 54% efficiency improvement as 'a good start' but insufficient.

July 10, 2026

2 min read

Source: Quartz

Key Numbers

efficiency gain

54%

Nikesh Arora, CEO of Palo Alto Networks (PANW), described OpenAI's latest model achieving a 54% efficiency gain as "a good start" but emphasized that costs must continue to fall significantly over the next two years.

Details of the Statement

Arora stated that AI token costs need to drop by 90% within the next two years to enable widespread adoption and economic viability. He added that current improvements, while positive, are still insufficient to make AI technologies accessible to all.

Context

These remarks come amid a fierce race in the AI industry to reduce costs and increase efficiency. Palo Alto Networks, a cybersecurity firm, integrates AI into its products, making cost reduction critical to its business model.

What This Means for Investors

Arora's comments highlight the major challenge facing the AI industry: drastically reducing costs. For PANW investors, the company's ability to leverage AI depends partly on lower token costs, which could impact profit margins and competitiveness.

Frequently Asked Questions

Arora called for a 90% reduction in AI token costs over the next two years.

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This article was rewritten in Wrqti's editorial style based on information from the original source above. Content is informational only — not investment advice.