OpenAI cuts fundraising target to $20 billion at a $1.25 trillion valuation as investor demand cools

OpenAI has reduced its fundraising target by $10 billion to roughly $20 billion and lowered its target valuation to $1.25 trillion from an earlier ask of $1.4 trillion, according to the Financial Times. The scale-back comes after some investors reduced their commitments amid a broader selloff in technology stocks and growing concern over the scale of spending required to build AI models and supporting computing infrastructure.

The round is now expected to fall short of the $20 billion target at its initial close, with a later offering potentially used to fill the gap. Earlier in the process, Morgan Stanley and tech fund Dragoneer brought the deal to private wealth clients at a $1.4 trillion pre-money valuation, but demand fell short of prior OpenAI rounds. Coatue Management and funds based in the United Arab Emirates have been in talks to co-lead the revised round, with BlackRock also mentioned as a participant in discussions.

The revised terms signal a shift in the AI funding environment, with investor caution appearing to recalibrate expectations around mega-cap AI valuations at a moment when Anthropic is also preparing a public offering.