OpenAI Trims Funding Round to $20 Billion at $1.25 Trillion Valuation

OpenAI has cut its fundraising target to $20 billion — a third below the $30 billion it originally sought — at a valuation of $1.25 trillion, with UAE investors and Coatue leading the round. CNBC confirmed the reduced figure on October 31. The round is still open, so the numbers could change, a person familiar with the deal said. OpenAI did not respond to CNBC's request for comment.

The Financial Times first reported the reduction, saying OpenAI gave investors until October 30 to commit, and some chose to shrink their allocations. Reuters, citing the FT, reported the first close is expected to bring in less than $20 billion. Current commitments total around $11 billion, according to the Wall Street Journal.

How the valuation moved

The math has shifted twice in five weeks. Bloomberg first reported the raise on September 29 at a $1.4 trillion valuation. The current $1.25 trillion figure is $150 billion lower — a 10.7% haircut in about a month.

Even the definition is murky. CNBC's October 22 report called $1.25 trillion a pre-money valuation; its latest report, citing the FT, calls it post-money. That distinction is worth up to $20 billion. Either way, the current figure sits roughly 47% above the $852 billion valuation from OpenAI's $122 billion round that closed March 31.

Put the valuation against revenue and it's still rich. Bloomberg puts OpenAI's annualized revenue at about $50 billion as of end-September, expected to reach at least $70 billion by end-2026. At $1.25 trillion, the round prices OpenAI at about 25 times its September run rate.

Who's writing the checks

• A group including state-backed MGX is expected to be the largest participant, per CNBC.
• Reuters reports OpenAI might be able to lease new computing capacity in the region.
• Founders Fund, Sequoia Capital, and Andreessen Horowitz are also expected to join.
• Wealthy individuals could invest later at the same valuation, potentially bringing the total to $20 billion.

Why the same names are hedging

Four investors expected to join OpenAI's round also backed its main competitor this year. Coatue, MGX, and Founders Fund led or co-led Anthropic's $30 billion Series G at a $380 billion valuation in February. Sequoia helped lead Anthropic's $65 billion Series H at a $965 billion valuation in May.

That overlap is making some investors hesitant, and the timing explains why. Anthropic filed its prospectus on October 26 for a Nasdaq listing under the ticker ANT, with reports suggesting a mid-November debut at a valuation between $1.5 trillion and $2 trillion. The filing shows $16.3 billion in first-half 2026 revenue and a second-quarter operating profit of $974 million. OpenAI's own prospectus, filed confidentially on June 8, remains private.

Harrison Rolfes, a senior late-stage research analyst at PitchBook, told Tech Funding News that OpenAI has "a free option" to see how institutions respond to Anthropic's audited financials before setting its own price. That option loses value, he said, if OpenAI is already far along in its own SEC review.

What does this change for investors?

The cut came during a rough week for AI stocks. On October 30, Intel dropped 25% after weak guidance and Nvidia lost 4%, per CNBC. Microsoft, Alphabet, and Amazon all reported capital spending below analyst expectations.

OpenAI's capital needs don't shrink with the market. In February, it told investors it aims to spend about $600 billion on compute by 2030. J.P. Morgan Global Research estimates AI capital spending could reach $900 billion in 2026 and $5.5 trillion in total by 2030.

The real test arrives in the next few weeks. If institutions value Anthropic at $1.5 trillion or more, OpenAI's $1.25 trillion looks like a bargain. If they don't, weak demand in OpenAI's round will signal where overall appetite for AI assets actually stands.