The Financial Times reported Friday, citing people familiar with the matter, that OpenAI now aims to raise about $20 billion in the latest funding round. The target represents a reduction of $10 billion. The Financial Times also reported that OpenAI lowered the desired valuation from $1.4 trillion to $1.25 trillion.
OpenAI gave investors until Friday to commit funds. However, the Financial Times said the initial close is expected to raise less than $20 billion because some investors reduced allocations. OpenAI did not immediately answer a request for comment.
A consortium of UAE investors, including state-backed technology fund MGX, is expected to contribute the largest amount to the round. OpenAI could reportedly obtain an option under the arrangement to lease computing capacity newly developed in the region. Founders Fund, Coatue, Sequoia Capital and Andreessen Horowitz are expected to invest as well. A later retail offering could give wealthy individuals another chance to invest at a valuation of $1.25 trillion.
Last week, the Financial Times reported that OpenAI was seeking approximately $30 billion in fresh capital at a valuation of around $1.25 trillion. That valuation would be nearly 50% above OpenAI's current valuation of $852 billion. However, the valuation would remain below the $1.4 trillion OpenAI had previously discussed with potential investors.
OpenAI is reducing fundraising ambitions while expanding AI infrastructure and competing with rivals. The reduction comes amid a broader technology stock selloff and growing investor concern about substantial AI infrastructure spending. The Nasdaq Composite dropped about 2.9% on Friday. The index is 7.8% below the record closing level reached on October 6.
Reuters reported that OpenAI is pursuing a possible stock market listing in 2027. Reuters also reported that OpenAI wants to finish fundraising before rival Anthropic's anticipated IPO because both companies seek investment from a similar investor base.
Reports in August put OpenAI's annualized revenue run rate above $40 billion, nearly twice the level at the end of 2025. OpenAI President Greg Brockman also said the annualized revenue run rate rose more than 20% in July alone.
OpenAI Cuts $10 Billion from Funding Target Amid AI Market Selloff
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Summary
OpenAI slashes its funding target by $10 billion, now seeking $20 billion instead of $30 billion, with valuation down to $1.25 trillion from $1.4 trillion. The move comes as investors hesitate amid a tech stock selloff, with the Nasdaq Composite falling 2.9% on Friday. A UAE-backed group is expected to lead the round. OpenAI aims to finalize funding before Anthropic’s IPO. The firm’s annualized revenue run rate is over $40 billion as of August 2026. With shifting funding rates, altcoins to watch may see ripple effects from broader market moves.
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