Technology

OpenAI Cuts Funding Target by $10 Billion in Latest Round, FT Reports

Even the AI boom’s flagship company is trimming its ask: OpenAI’s latest round is now $20 billion at a $1.25 trillion valuation, down from $30 billion at $1.4 trillion.

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Highlights

  • OpenAI has slashed the target for its latest funding round by $10 billion, the Financial Times reported on Friday
  • The company is now seeking to raise $20 billion at a $1.25 trillion valuation
  • It was earlier aiming to raise $30 billion at a $1.4 trillion valuation, Reuters previously reported
  • The report lands in the same week public markets have been punishing AI spending across the big tech sector

A smaller ask from the biggest name in AI

OpenAI has slashed the target for its latest funding round by $10 billion and is now seeking to raise $20 billion at a $1.25 trillion valuation, the Financial Times reported on Friday, citing people with knowledge of the matter Reuters.

The company was earlier aiming to raise $30 billion at a $1.4 trillion valuation, Reuters previously reported Reuters. The figures come from the FT’s reporting; OpenAI’s own confirmation is not part of the report, and funding rounds at this scale routinely shift in size and valuation before they close.

Why the timing matters

A $20 billion raise at a $1.25 trillion valuation remains, by any historical measure, an enormous vote of confidence. But the direction of travel is the story: the cut was reported in the same week that public-market investors have been selling AI-exposed stocks hard — including the selloff covered in our report on the Nasdaq’s worst month since March 2025 — over exactly the question OpenAI’s round now touches: how quickly AI spending converts into revenue.

Reuters’ Breakingviews column this week made the sceptics’ version of the argument about the sector’s other IPO candidate, noting that even a six-year-old company seeking a valuation north of $1.5 trillion offered only vague answers on its business model in more than 300 pages of disclosure Reuters. Private rounds and public filings are different instruments, but they now face the same examiner.

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Engineers walking a blue-lit data centre aisle

What to watch

Whether the round closes at $20 billion, and at what valuation, will be read as the private market’s verdict on the public market’s October. If OpenAI fills the smaller target quickly, the trim looks like pricing discipline. If it drags, the week the Nasdaq turned on AI spending will look like the moment the whole sector’s cost of capital changed.