A report indicates that OpenAI has fallen short of its internal revenue and user growth targets just ahead of its anticipated IPO later this year, leading to concerns about whether it can balance its substantial AI-related expenditures.
On Tuesday, shares of technology firms Oracle and SoftBank dropped 3.4% and 11.3%, respectively, as this report rekindled worries about an AI spending bubble reminiscent of the early 2000s dot-com crash.
The disappointing figures have stirred uncertainty among company executives. Chief Financial Officer Sarah Friar reportedly voiced worries about the firm’s ability to fulfill future computing contracts if growth doesn’t speed up, as noted by The Wall Street Journal.
In the meantime, OpenAI’s CEO Sam Altman has committed to a $600 billion deal aimed at future spending, with the expectation that enhanced data center capacity will support the expansion of ChatGPT, according to sources who spoke to the Journal.
Additionally, the company has not achieved its internal target of reaching 1 billion weekly active ChatGPT users by the end of last year and has fallen short of its annual revenue goals. It struggled to meet various monthly income benchmarks this year and has faced issues with subscriber retention.
In a joint statement, Altman and Friar told the Journal, “We completely agree on maximizing our computing purchases and collaborating diligently every day,” dismissing any contrary speculation as “ridiculous.”
Responding to inquiries, an OpenAI spokesperson labeled the report as “clickbait” from the Journal. “Sarah has successfully raised $122 billion, detailing our computing strategy,” the spokesperson noted, asserting the alignment of their strategies and enthusiasm for progress.
The spokesperson also highlighted positive reception for new ChatGPT features, including advertising and AI image generation, and mentioned the swift growth of its coding tool, Codex, asserting that substantial computing contracts have driven these successes.
Recently, OpenAI introduced ChatGPT-5.5, a powerful model aimed at surpassing industry benchmarks and cutting costs by phasing out projects like the AI video app, Sora.
However, the company is securing so much computing power in the coming years that it risks exhausting its $122 billion in funding within just three years, as reported. In a memo to investors, OpenAI claimed it had obtained more computing power than its competitor, Anthropic, seemingly addressing rival CEO Dario Amodei’s recent caution regarding data center spending.
OpenAI reflected on the situation, suggesting that past strict spending measures were less a sign of discipline and more an indication of recognizing rapidly emerging demand.
Despite this, board members have lately begun questioning Altman’s strategy for securing additional computing resources as the growth of ChatGPT has stagnated in recent months. Friar has also expressed hesitations about the company’s readiness to meet the reporting standards necessary for a public offering by the year’s end, in discussions among executives and board members.
Altman, who is currently navigating legal disputes with Elon Musk, reportedly favors a more aggressive timeline for the IPO.
