OpenAI has reduced the target for its latest funding round by $10 billion amid a broader selloff in technology stocks driven by concerns over AI spending, according to a Financial Times report citing people familiar with the matter. The ChatGPT maker is now seeking approximately $20 billion at a valuation of $1.25 trillion, down from an earlier target of about $30 billion at $1.4 trillion.
The company set a Friday deadline for investor commitments. The initial close is expected to raise less than $20 billion after some investors reduced their allocations. A consortium of United Arab Emirates investors, including state-backed tech fund MGX, is expected to be the largest participant; as part of the arrangement, OpenAI would gain an option to lease newly developed computing capacity in the region. Other expected participants include venture firms such as Founders Fund, Coatue, Sequoia Capital, and Andreessen Horowitz.
The adjustment comes as the Nasdaq Composite fell about 2.9% on Friday and is down roughly 7.8% from its October 6 record close, reflecting investor anxiety over the scale of AI infrastructure investments. OpenAI had previously raised a record $122 billion in March at an $852 billion valuation and has been aiming to close this round ahead of rival Anthropic’s planned public listing.
The Drivers of the Current Situation
The main development is OpenAI’s reported decision to lower both the fundraising target and valuation for its current private round in response to softer investor appetite. Confirmed elements from the FT reporting include the reduction from a $30 billion / $1.4 trillion goal to roughly $20 billion / $1.25 trillion, the expectation of a first close below the new target, the involvement of a UAE-led consortium with a computing-power option, participation interest from major venture firms, and the backdrop of a tech-stock selloff tied to AI-spending concerns. These changes occurred as OpenAI sought to lock in capital before its own potential 2027 listing and Anthropic’s imminent IPO.
The actual amount raised in the first close and any further adjustments will clarify the outcome.
Impact and Broader Context
The scaled-back ambitions signal cooling private-market enthusiasm for frontier AI labs at elevated valuations while public tech stocks face pressure. It raises questions about the sustainability of large-scale AI capital raises, the competitive dynamics with Anthropic’s listing, the role of sovereign-linked investors and compute access in future deals, the implications for OpenAI’s spending plans on computing infrastructure, and whether similar caution will affect other AI companies. Coverage distinguishes between the reported terms and the still-pending final close.
Subsequent confirmation of the raised amount, valuation details, or further market reaction will determine the lasting effect.
This analysis draws from the Financial Times report and corroborating coverage by Reuters and others. Exact final proceeds, investor allocations, and any official OpenAI statements remain subject to the completion of the round and further disclosures.