"OpenAI, the creator of ChatGPT, has overtaken Elon Musk's SpaceX to become the world's most valuable startup, after a share sale pushed its valuation to $500 billion. The deal saw current and former OpenAI employees sell about $6.6 billion worth of shares to a group of high-profile investors, including Thrive Capital, SoftBank, Dragoneer Investment Group, Abu Dhabi's MGX, and T Rowe Price, according to Reuters."
"In the first half of this year, OpenAI reported revenue of around $4.3 billion, already exceeding its entire 2024 performance by 16%. The company is now on track to hit a full-year revenue target of $13 billion. However, the scale of OpenAI's ambition comes with significant costs. The company booked an operating loss of $7.8 billion due to heavy spending on research, development, and infrastructure to support its advanced AI models."
"Despite the losses, investors remain bullish on OpenAI's long-term prospects. The company is seen as central to the global AI race, with applications in everything from productivity software and search to healthcare, education and customer service. The $500bn milestone also reflects the appetite for AI-driven disruption across industries, even as regulators in the US, UK and EU weigh how best to oversee the sector."
OpenAI achieved a $500 billion valuation following a secondary sale in which current and former employees sold about $6.6 billion of shares to investors including Thrive Capital, SoftBank, Dragoneer, Abu Dhabi's MGX and T Rowe Price. The company now ranks above SpaceX and other decacorns. OpenAI reported roughly $4.3 billion in revenue in the first half of the year and is on track for about $13 billion for the full year, while recording a $7.8 billion operating loss due to heavy R&D and infrastructure spending. Investors remain bullish on broad AI applications even as regulators consider oversight.
Read at Business Matters
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