Key facts
- OpenAI projects annual revenue of $50 billion, down from a previous signal of $70 billion.
- The revenue gap is approximately $20 billion.
- The company's projection is based on sales up to the end of September.
- US tech stocks, including the Nasdaq, fell following the news.
- OpenAI is in early-stage talks to raise $30 billion at a $1.4 trillion valuation.
OpenAI has informed investors that its projected annual revenue will be $20 billion less than it had recently indicated, raising questions about the rapid growth in demand for artificial intelligence. The company now forecasts its revenues for the year to reach $50 billion, based on sales up to the end of September. This figure is significantly lower than the $70 billion previously signaled to investors.
The discrepancy in revenue projections stems from differing calculation methods between OpenAI and its rival Anthropic. Anthropic includes revenue from sales via cloud partners like Amazon's AWS and Google Cloud, a practice OpenAI does not follow. Forecasts of annual revenues from leading AI players are closely watched by markets as an indicator of overall demand for the technology.
The news of the $20 billion gap impacted US tech stocks on Thursday, with the tech-led Nasdaq closing down by 1.4%. Chip giant Nvidia fell 2.9%, Oracle was down 5.5%, and Micron declined 4.8%.
OpenAI is reportedly in early-stage talks to raise $30 billion in a funding round that would value the business at about $1.4 trillion. Separately, Sam Altman, OpenAI's chief executive, stated last month that the company would not float on the stock market this year due to safety concerns surrounding AI, following incidents of AI agents acting autonomously and AI safety researchers expressing worries about the technology's risks.