OpenAI: A massive $12 billion loss and the dream of a $1 trillion IPO

Illustration photo.

In its earnings filing for the quarter ended September 30, Microsoft revealed a net loss from its investments in OpenAI that reduced its net income by $3.1 billion.

Based on Microsoft's ownership stake in OpenAI (about 27%) and equity accounting principles, Microsoft's $3.1 billion net profit reduction suggests OpenAI had a net loss of about $11.5 billion in that quarter.

The actual figure could be even higher. Taking into account Microsoft’s pre-tax net loss of $4.1 billion, and its presumed higher pre-conversion ownership of 32.5 percent, OpenAI’s quarterly loss could exceed $12 billion. According to the Financial Times, this could be one of the largest quarterly losses ever recorded by a private technology company.

Revenue increased but "money burning speed" was terrible

The loss is especially staggering when compared to OpenAI’s revenue. The company is expected to generate $4.3 billion in revenue in the first half of 2025, according to the Financial Times. This means that the loss in this one quarter is nearly three times the company’s half-year revenue and accounts for most of OpenAI’s projected full-year revenue of about $13 billion in 2025.

OpenAI’s cash burn isn’t new. In January 2025, CEO Sam Altman admitted the company was losing money on its $200-a-month ChatGPT Pro subscription. The plan proved more popular than expected, driving usage far beyond revenue and increasing the company’s operating costs. The candid admission also coincided with previous reports that OpenAI was on track to lose as much as $5 billion by 2024—a rate of cash burn that could deplete the company’s reserves in just a year if left unchecked. The Information reported that OpenAI’s annual AI training and inference costs could reach $7 billion this year, not to mention another $1.5 billion for staff. Furthermore, OpenAI’s revenue model is also under pressure due to a revenue-sharing deal with Microsoft, which requires the company to give up 20% of its customer cash flow to its partners.

IPO pressure and the trillion dollar target

The massive loss partly explains why OpenAI is rushing to prepare for a potential IPO. CEO Sam Altman has said that an IPO is “the most viable path” due to the huge capital needs.

OpenAI is preparing for an IPO that could value the company at as much as $1 trillion, people familiar with the matter said. The company has discussed raising at least $60 billion in preliminary talks. Financial advisers have predicted the listing could be as early as the second half of 2026, or as late as 2027, a target set by Chief Financial Officer Sarah Friar. However, an OpenAI spokesperson noted that “an IPO is not our focus” and the company is focused on building a sustainable business.

OpenAI recently completed a restructuring to transform into a traditional for-profit company, simplifying its structure, increasing its ability to raise capital, and providing financial support for Altman's plan to spend trillions of dollars on AI infrastructure.

Hien Thao (t/h)

Source: https://doanhnghiepvn.vn/doanh-nhan/openai-khoan-lo-khong-lo-12-ty-usd-va-giac-mo-ipo-1-000-ty-usd/20251101052934195