OpenAI cuts valuation target to $1.25 trillion in $30 billion funding round
OpenAI is nearing a funding round of up to $30 billion, led by UAE investors and Coatue, after lowering its pre-money valuation target from $1.4 trillion to $1.25 trillion.
OpenAI is close to completing a funding round of up to $30 billion, but it has reduced the valuation it is seeking from roughly $1.4 trillion to $1.25 trillion. The revised figure is a pre-money valuation, which means it does not include the new cash. Investors from the United Arab Emirates are leading the financing alongside the US investment firm Coatue, according to people familiar with the deal.
The price cut reflects resistance from prospective backers. Reports indicate that some investors have questioned the scale of spending required to develop artificial intelligence models and build the computing infrastructure to run them. One report described weak investor demand, with some institutions showing what it called capital fatigue after heavily participating in earlier rounds. The lower target also arrives during a broader selloff in technology stocks, as markets increasingly question the returns on AI infrastructure and the cost of financing it.
OpenAI has told investors it expects commitments by October 30, and it hopes to secure signatures by the end of the week. The final size of the round has not been fixed, and the company could raise less than $30 billion if demand falls short. The terms remain subject to negotiation and could still change before closing. OpenAI declined to comment on the talks.
The round is positioned as a bridge ahead of a potential public offering, and the company has pushed its expected stock market debut into 2027. Its last round closed in March, raising $122 billion at an $852 billion post-money valuation, with Amazon, NVIDIA and SoftBank as anchors. Even at the lower target, the proposed valuation would be nearly 50 percent above that figure and would place OpenAI among the most valuable private companies in the world.
The financing is also tied to a separate commercial discussion. CNBC reported that the UAE investment may be linked to an agreement securing additional computing capacity for OpenAI. Earlier in October, the company had presented the $1.4 trillion price to prospective backers, including BlackRock and the UAE fund MGX, according to reporting at the time.
The negotiations show how the economics of frontier AI are now shaping corporate finance. Training large models and securing data center capacity requires sums that only a small number of investors can supply, which gives sovereign funds and large asset managers considerable leverage over pricing. Whether the revised valuation holds will indicate how far investor enthusiasm for AI has cooled since the March round, and whether a public listing in 2027 remains realistic for a company of this scale.
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