OpenAI Plans $1 Trillion IPO by Late 2026, Sources Confirm

UPDATE: OpenAI is reportedly planning an initial public offering (IPO) valued at up to $1 trillion, with a timeline potentially set for late 2026. This development comes just days after the company transitioned from a non-profit to a for-profit entity, signaling its ambition to become a major economic player globally.

The news, first reported by Reuters based on insights from three sources familiar with the matter, indicates that OpenAI CFO Sarah Friar has hinted to associates that the IPO could happen as early as 2027, but insiders suggest it may occur sooner than anticipated. A valuation of $1 trillion would position OpenAI as the 12th most valuable publicly traded company worldwide, just behind Berkshire Hathaway and ahead of JPMorgan Chase and Walmart.

This IPO could dramatically change how OpenAI operates. Traditionally, public companies are under immense pressure to deliver profits rather than merely spend capital, a challenge OpenAI has faced in the past. As tech entrepreneur Elon Musk noted, “There’s immense pressure on a public company to not have a bad quarter,” highlighting the scrutiny that comes with being listed.

OpenAI’s plans come amid ambitious growth targets. In a recent livestream, CEO Sam Altman discussed the company’s future, claiming they aim to build one gigawatt of new data center capacity each week, which he estimates will cost around $20 billion per gigawatt. This ambitious plan translates to an eye-watering potential revenue exceeding $1 trillion annually. Altman emphasized, “We need to get to hundreds of billions a year in revenue, and we’re on a pretty steep curve towards that.”

The move to go public would provide greater transparency, requiring OpenAI to disclose comprehensive financial data and historical performance in an IPO prospectus. This transparency could lead to heightened scrutiny from institutional investors and Wall Street traders alike, similar to what occurred with other tech companies like Uber, which faced a rocky debut after going public in 2019.

Factors influencing this decision include the need for substantial capital to support its expansive goals and the pressure to showcase profitability. Companies can withdraw their IPOs if market conditions appear unfavorable, as seen with Endeavor Group, which opted out of its public offering in a challenging climate.

As OpenAI gears up for this potentially groundbreaking IPO, stakeholders and investors will be closely monitoring the developments. The economic implications of a publicly traded OpenAI could reshape the landscape of the AI industry and beyond.

Stay tuned for more updates as this story develops!