OpenAI Lowers Funding Target to $20 Billion

OpenAI reduced its latest fundraising target to $20 billion, down from an initial goal of $30 billion, as investors adopt a more cautious approach toward artificial intelligence spending. The company also lowered its proposed post-money valuation to $1.25 trillion from a previous target of $1.4 trillion. These adjustments follow a sharp selloff in U.S. technology shares and growing concerns regarding the timeline for financial returns on AI investments.

A consortium of investors from the United Arab Emirates, led by the state-backed technology fund MGX, is expected to provide the largest contribution. The agreement may grant the company the option to lease new computing capacity developed within the United Arab Emirates. Other prospective participants include venture capital firms Sequoia Capital, Andreessen Horowitz, Coatue Management, and Founders Fund.

OpenAI has set a Friday deadline for investor commitments and is pursuing a public listing in 2027. This timeline is intended to precede a potential public debut by rival AI developer Anthropic, which reports a target valuation of at least $1.5 trillion.