San Francisco: As per reports, OpenAI, the company behind ChatGPT, expects to incur about 5 billion dollars in losses this year despite generating 3.7 billion dollars in revenue.
The company's revenue has surged, reaching 300 million dollars last month—a 1,700 percent increase since early 2022. OpenAI aims to achieve 11.6 billion dollars in sales next year, according to a source familiar with the company’s financials, though CNBC has not reviewed the financial documents directly.
The New York Times first reported on the company's finances after reviewing internal documents. OpenAI, which is heavily backed by Microsoft, is in the process of raising additional funding that could value the company at over 150 billion dollars. Thrive Capital is leading this funding round with a 1 billion dollars investment, and Tiger Global is expected to participate.
OpenAI’s CFO, Sarah Friar, recently informed investors that the funding round is oversubscribed and will conclude next week. This follows the recent departure of key figures, including Mira Murati, OpenAI's Chief Technology Officer, who left after six and a half years with the company.
The company's board is also considering restructuring OpenAI to operate as a for-profit business, though it plans to maintain its nonprofit segment separately. This shift would simplify the investment structure and potentially allow OpenAI employees to access liquidity more easily, according to a source close to the discussions.
OpenAI has seen massive growth since launching ChatGPT in late 2022, selling subscriptions to various AI tools and licensing its GPT models. However, maintaining the infrastructure for these models, particularly investing in Nvidia’s GPUs, has contributed significantly to the projected 5 billion dollars in losses. The New York Times noted that other expenses, such as equity-based compensation, are not fully accounted for in the documents reviewed.
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