OpenAI forecasts that its revenue would rise to $11.6 billion in 2025, up from an estimated $3.7 billion in 2024. Even though it expects losses of up to $5 billion this year because to significant processing power expenditures.
Over $1 billion is invested by Thrive Capital in the OpenAI fundraising round.
Thrive Capital is contributing more than $1 billion to OpenAI’s current $6.5 billion fundraising round, and it is receiving a perk that other investors do not: if the AI company meets a revenue target, it may invest an additional $1 billion at the same valuation the following year, according to people with knowledge of the situation on Friday.
According to anonymous sources, OpenAI projects that its income would soar to $11.6 billion in 2024, up from an expected $3.7 billion in 2024. This year, losses could reach $5 billion, according to one of the sources, mostly based on their variable spending on processing power.
The current funding round, which comes in the form of convertible debt, is expected to close by the end of next week and could value OpenAI at $150 billion, cementing its status as one of the most valuable private companies in the world.
That valuation depends on pulling off a complicated restructuring to remove the control of its non-profit board and also remove cap on investment return to investors, a plan first reported by Reuters. There is no specific timeline when the conversion could be completed.
Thrive Capital, which also led OpenAI’s previous funding round, is offering $1.2 billion from a combination of its own fund and a special purpose vehicle for smaller investors. Other investors on the new round include Microsoft, Apple, Nvidia and Khosla Ventures.
The CEO Sam Altman’s initial estimate of $1 billion in revenue for this year is greatly exceeded by OpenAI’s revenue estimates. Sales of its services to corporations and chatbot subscriptions are the company’s primary sources of income.
Revenue from ChatGPT, the company’s core product, is predicted to reach $2.7 billion this year, up from $700 million in 2023. With a $20 monthly cost, the chatbot service boasts roughly 10 million paying customers.
The New York Times broke the financials and information on Thrive’s extra option on Friday.
(Reporting by Krystal Hu and Kenrick Cai in San Fransico; Editing by Will Dunham)
