OpenAI has reduced its upcoming funding round goal by $10 billion to a new target of up to $20 billion, CNBC confirmed on Saturday. The adjustment comes amid a wider market downturn affecting technology stocks and growing investor questions regarding artificial intelligence returns.
Funding Details and Market Pressures
The current funding round remains active and has not yet closed, meaning the financial figures could still change, according to an anonymous source directly familiar with the transaction who was not authorized to discuss the details publicly. OpenAI did not immediately respond to requests for comment regarding the adjustment.
The Financial Times initially reported the $10 billion reduction in the fundraising target, noting that the enterprise is aiming for a post-money valuation of $1.25 trillion. The FT also reported that the ChatGPT developer established a Friday deadline for investors to make their financial commitments, leading some participants to decrease their planned allocations.
Investors based in the United Arab Emirates are spearheading the round together with Coatue, as previously reported by CNBC. This capital-raising adjustment follows a week marked by heightened scrutiny from investors regarding whether massive tech industry spending on AI infrastructure—such as data centers and graphics processing units—will yield sufficient financial returns.
Broader Technology Sector Impact
Artificial intelligence-related stocks experienced sharp declines on Friday, led by chip manufacturer Intel plummeting 25% following weak revenue guidance. Other chipmakers also saw losses, with Micron dropping 5.5% and Nvidia falling 4%.
Major technology companies including Microsoft, Amazon, and Alphabet’s Google have maintained aggressive spending initiatives in recent years to satisfy booming demand for AI hardware and infrastructure. However, all three firms recently released capital expenditure figures or projections that fell below expectations set by analysts.
Alphabet suffered its worst trading day in history on Thursday after reporting search revenue that missed expectations. Philipp Schindler, Alphabet’s chief business officer, explained that the negative impact on search performance resulted partly from reduced monetization rates within the company’s AI Mode.
