OpenAI Cuts Fundraising Target by $10 Billion to $20 Billion

OpenAI has lowered its target for a new funding round to $20 billion from $30 billion, a $10 billion reduction. According to ChainCatcher, the company’s valuation target also fell from $1.4 trillion to $1.25 trillion, while investor commitments stood at about $11 billion by Friday’s deadline—less than half the original fundraising goal. The first closing is expected to fall short even of the revised target. The fundraising plan reportedly called for about $30 billion at a valuation above $1.4 trillion in mid-October. Around October 22, the valuation target was reduced to $1.25 trillion, followed this week by the cut to the fundraising goal. OpenAI had sought to secure investor commitments before rival Anthropic’s planned IPO. Anthropic disclosed IPO documents this week and is targeting a valuation of at least $1.5 trillion. The fundraising slowdown coincides with a sharp repricing of AI-related stocks. The Philadelphia Semiconductor Index fell more than 8% this week; Intel dropped 25% in one day after issuing revenue guidance well below expectations, Micron fell 5.5%, Nvidia declined 4%, and Alphabet had its worst trading day ever on Thursday. Capital spending figures or forecasts from Microsoft, Alphabet, and Amazon also came in below analyst expectations. OpenAI’s projected cumulative free cash flow deficit for 2026–2030 is about $278 billion, according to an internal investor document. Compute and data-center agreements signed over the past 15 months have a stated total value of more than $1.4 trillion, about 35 times the company’s current annualized revenue. An Emirati consortium is leading the round, with state-backed technology funds including MGX among the main investors. Founders Fund, Andreessen Horowitz, SoftBank, and wealthy individuals are also participating. OpenAI plans to lease additional computing capacity in the UAE for model training and operations, and intends to broaden fundraising to family offices and wealthy individuals over the next few weeks. The outcome could affect the company’s IPO timeline.