OpenAI files confidential US IPO as AI sector faces trillion-dollar test
The ChatGPT maker’s filing marks a structural shift from its hybrid non-profit model, though the firm warns a listing may take time as it navigates a crowded and capital-intensive market.
OpenAI has confidentially filed for a US initial public offering, confirming on Monday that it is formally seeking a transition from its private status to a publicly traded entity. The filing places the artificial intelligence pioneer alongside rivals Anthropic and Elon Musk’s SpaceX in a concerted push for stock market exposure, driven by intense investor appetite for the sector.
The company did not disclose the size or terms of the offering, stating that a timeline for the debut has not yet been determined. A spokesperson noted that the process "may be a while," citing objectives that the firm considers easier to achieve while remaining private. This caution contrasts with reports from Reuters suggesting the AI giant is targeting a valuation of up to $1 trillion, with a potential stock market debut as early as September.
The move follows a significant legal development in May, when a US jury ruled against Musk in his lawsuit regarding OpenAI’s structure. The verdict found the company not liable for allegedly straying from its original mission, a decision analysts say has removed a key legal overhang that previously complicated the firm’s path to the public markets.
OpenAI’s recent corporate restructuring involved creating a public benefit corporation to ease restrictions imposed by its non-profit parent. This shift allows the firm to forge new partnerships with major technology players, including Amazon and Alphabet’s Google, following a renegotiation of its long-standing agreement with Microsoft. Microsoft, which has invested $13 billion in OpenAI since 2019, remains a key backer as the company seeks to scale its operations.
Financial metrics released earlier this year indicate rapid growth, with OpenAI reporting $2 billion in monthly revenue in March and more than 900 million weekly active users for ChatGPT. However, the company has told investors it does not expect to be profitable until 2030. The impending listings of OpenAI, Anthropic, and SpaceX are viewed as a critical test of investor confidence in high-growth technology stocks over the next decade.
Despite the enthusiasm, some market observers warn that the scale of these offerings could impact the broader IPO landscape. Gil Luria, managing director of D.A. Davidson, cautioned that the public market capital required for such massive debuts might exhaust resources that could otherwise flow to smaller deals, particularly as large public competitors continue to raise capital through secondary issuances.
The competitive landscape has also intensified, with Anthropic recently filing for its own IPO after raising $65 billion in a funding round that valued it at $965 billion. As OpenAI navigates this transition, it faces scrutiny over whether the AI sector’s meteoric rise can be sustained against a backdrop of increasing competition and capital demands.
