OpenAI projected to bring in $20bn less in revenue than expected
Questions raised over AI growth as ChatGPT maker forecasts this year’s revenue at $50bn, way below the $70bn signalled before OpenAI has revealed that it is making about $20bn less in projected revenue than it had recently indicated to investors, raising questions about the break-neck growth rate in demand for AI. The ChatGPT-maker company has told investors that its revenues for this year would…
OpenAI, the creator of ChatGPT, has projected to bring in $50 billion in revenue for this year, significantly lower than the $70 billion previously signaled to investors. This discrepancy in revenue predictions has raised concerns about the rapid growth in demand for AI technology. The company is currently in discussions to raise $30 billion in a funding round, which would value the business at around $1.4 trillion.
The gap in revenue projections stems from differences in how OpenAI and rival Anthropic measure revenue. While Anthropic includes revenue from sales via cloud partners like Amazon's AWS and Google Cloud, OpenAI does not. This discrepancy has impacted US tech stocks, with the tech-focused Nasdaq index falling by 1.4% on Thursday.
Nvidia, a major chip company, saw a 2.9% decline, while Oracle dropped 5.5% and Micron Technology fell 4.8%. OpenAI's CEO, Sam Altman, recently stated that the company would not go public this year due to safety concerns surrounding AI. Both Democrats and Republicans are calling for new regulations to govern AI systems, following warnings from Anthropic researchers about the potential risks of rapid AI development.
Anthropic is also set to pursue an initial public offering (IPO) soon. OpenAI's last major fundraising round was in March, where it raised $122 billion at a valuation of $852 billion. Anthropic raised $65 billion in the same period, valuing the company at $965 billion. Meanwhile, Japanese investment firm SoftBank is seeking to raise up to $100 billion from Gulf states to support its growing AI investments, including its substantial $65 billion investment in OpenAI.
SoftBank has recently raised $11.1 billion in the largest high-yield corporate bond sale in history to fund its AI and semiconductor projects.
Written by urgent.news from Guardian Technology's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
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