Key Points

• OpenAI Reports Lowering Financing Target by $10 Billion
• Proposed valuation reduced from $1.4 trillion to $1.25 trillion
• AI Stock Sell-off Cools Investors' Interest in Financing

It is reported that with the massive selling of artificial intelligence stocks, investors are becoming increasingly reluctant to fund the industry's ambitious infrastructure plans. OpenAI has lowered its latest financing target by $10 billion.

According to a report by Reuters on October 30th, citing The Financial Times, this ChatGPT developer is currently seeking around $20 billion, rather than $30 billion. Its proposed valuation has also been reduced from $1.4 trillion to $1.25 trillion.

At this time of reduction, investors are questioning whether AI company will be able to generate sufficient revenue to justify the billions of dollars invested in computing infrastructure.

OpenAI Reduces Financing Ambitions as Investors Reduce Commitments

OpenAI initially sought to raise $30 billion in new capital to support expansion and to prepare for a potential listing in 2027.

However, it is reported that by the deadline promised on Friday, some investors had reduced their original planned contributions.

According to people familiar with the matter, the preliminary closing size of this round of financing is expected to be lower than the revised target of $20 billion.

A group composed of investors from the United Arab Emirates, including the state-backed technology fund MGX, is expected to become the largest participant.

As part of the proposed arrangement, OpenAI may be granted an option to lease newly developed computing capacity in that region.

Other potential investors reportedly also include Founders Fund, Coatue Management, Sequoia Capital, and Andreessen Horowitz.

The revised financing target was set after the previous valuation reduction.

On October 23, Coinpaper reported that the valuation of OpenAI had decreased by approximately $150 billion to $1.25 trillion from $1.4 trillion.

The latest developments indicate that investors' concerns now affect not only the pricing of OpenAI shares but also how much capital the company is able to attract.

However, the financing terms are still subject to negotiation, and the company has not yet publicly confirmed that financing has been completed based on the reported valuation.

The sharp drop in AI stock has raised doubts about the computing power costs of OpenAI.

The financing difficulties of OpenAI coincided with one of the most intense rounds of selling in the technology sector in 2026.

On October 30th, the Nasdaq Composite Index fell by about 2.9%, which is 7.8% lower than the closing record set on October 6th.

Investors are increasingly concerned about the huge expenditures required for building the AI data center, purchasing advanced processors, and ensuring a stable power supply.

These concerns have spread to companies that provide infrastructure for OpenAI and its competitors.

Amazon recently reported that despite strong growth in cloud business revenue, free cash flow has deteriorated from $14.8 billion positive in the past 12 months to $42.4 billion negative.

Coinpaper's analysis of Amazon indicates that infrastructure investments will deplete cash more quickly than profit-generating businesses.

At the same time, Standard & Poor's Global Ratings downgraded the credit outlook of Meta to negative, warning that its continuously expanding AI investments could lead to a huge cash flow gap.

The institution's forecast of $71 billion indicates that financing pressures are beginning to affect credit ratings, not just stock valuations.

For OpenAI, obtaining affordable computing power remains key to training and operating increasingly advanced AI models.

Anthropic IPO puts pressure on OpenAI's financing efforts

OpenAI also faces increasingly fierce competition for investor capital from Claude developer Anthropic.

Anthropic publicly submitted a NASDAQ listing application on October 26, disclosing significant revenue growth, as well as substantial operating and accounting losses.

Coinpaper's report on Anthropic IPO details the company's net loss of $80.7 billion for the first half of the year, a large portion of which reflects non-cash accounting expenses.

The company may start trading in November, which could provide investors with another way to participate in the rapidly expanding AI market.

It is reported that OpenAI has been hoping to complete financing before the expected listing of Anthropic, as both companies are competing for the same pool of institutional capital.