What happened to OpenAI’s $20bn? Revenue scare rattles AI trade
US tech futures rebounded on Friday, a day after a report that OpenAI’s annualised revenue was $20 billion (€17.8bn) below earlier estimates helped send the Nasdaq down 1.25% and hit chipmakers and cloud giants.
The recent drop in AI stocks sent shockwaves through the technology sector on Friday. After confusion over OpenAI's revenue figures rattled investor confidence, Wall Street showed signs of recovery early in the trading day, but the overall impact was significant.
OpenAI's annualized revenue, which reached around $50 billion by the end of September, was significantly lower than the company had projected. This $20 billion discrepancy stemmed from OpenAI recalculating its sales to align with rival Anthropic's method of counting cloud sales as revenue, rather than excluding them as OpenAI does. While this discrepancy doesn't indicate missed targets or lost sales, it exposed a worrying gap in the company's financial reporting.
The fallout from OpenAI's earnings report was felt across the tech industry. Companies such as Oracle, CoreWeave, Microsoft, Amazon, Alphabet, and Meta all experienced declines, as they are heavily invested in AI development and rely on OpenAI's technology. Chipmakers, including Nvidia, AMD, and Broadcom, also suffered as demand for AI hardware remains strong.
However, despite the negative news, signs suggest that demand for AI hardware continues to be robust. Tech giants like Samsung and Taiwan's TSMC reported strong Q3 earnings, with Samsung hitting a record profit and TSMC reporting a 54.6% year-over-year increase in sales.
As investors await clearer data from upcoming earnings reports by Anthropic and OpenAI, the future of the AI boom remains uncertain.
Written by urgent.news from Euronews's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
