OpenAI Cuts Fundraising Target to $20 Billion as Investors Commit Just $11 Billion, Reports Say

OpenAI has cut the target for its latest fundraising round by $10 billion, to about $20 billion, after securing only around $11 billion in commitments from investors, according to reports published on Friday and confirmed on Saturday.

The Financial Times first reported the cut on Friday, according to TechCrunch and CNBC, saying the ChatGPT maker had lowered its goal from the $30 billion it set out to raise last month. A follow-up report in The Wall Street Journal said the company had secured about $11 billion so far, with some large investors responding tepidly. CNBC confirmed on Saturday that OpenAI is now seeking to raise up to $20 billion, citing a person directly familiar with the deal.

The round values OpenAI at a $1.25 trillion valuation, according to the Financial Times, down from the $1.4 trillion valuation attached to the original $30 billion target last month. The company had set Friday as the deadline for investors to commit to the round, and the first close is expected to come in below even the reduced $20 billion target, the Financial Times reported. A subsequent retail offering aimed at wealthy individuals could bring the total raised up to the $20 billion mark, according to the reports.

A group of investors from the United Arab Emirates is expected to lead the round, the Financial Times said, with the state-backed fund MGX among the largest participants. SoftBank Group and venture capital firms including Sequoia Capital, Coatue Management, Founders Fund and Andreessen Horowitz also plan to take part, according to the report carried by Bloomberg. OpenAI declined to comment on the reports, and did not immediately respond to a request for comment from CNBC, according to the outlets.

The scaled-back round lands at a moment when investors are questioning the enormous sums being poured into artificial intelligence. The Nasdaq 100 fell 3.5 per cent on Friday, and the Nasdaq Composite dropped 2.9 per cent, capping a week in which nearly $1 trillion was wiped from the Nasdaq, according to the Associated Press. Chipmaker Intel fell 25 per cent on Friday after weak revenue guidance, Micron dropped 5.5 per cent and Nvidia fell 4 per cent, CNBC reported. Alphabet suffered its worst trading day ever on Thursday, losing 12.3 per cent after its quarterly results disappointed, with its chief business officer acknowledging that its AI Mode was squeezing the money it makes from search.

The fundraising also faces direct competition from Anthropic, OpenAI’s closest rival, which is preparing to list on the Nasdaq in mid-November at a valuation of at least $1.5 trillion, according to the Financial Times. Anthropic made its IPO filing public on 26 October, revealing revenue of $16.3 billion for the first half of 2026 and a net loss of $80.7 billion, driven largely by a non-cash charge from revaluing convertible notes. Both companies are pitching many of the same investors, and OpenAI had raced to lock in commitments before Anthropic’s listing begins competing for the same pool of capital.

OpenAI, which raised $122 billion in March at an $852 billion post-money valuation, is seeking fresh capital to finance its vast computing ambitions as it prepares for a potential initial public offering of its own next year. The company has committed to about $600 billion of computing spending by 2030, and its pitch to investors has pointed to revenue reaching $50 billion on an annualised basis after the launch of its GPT-6 Astra model, rising to $70 billion by the end of the year, according to Reuters.

The round is still in progress and has not closed, so the figures remain subject to change, a person directly familiar with the deal told CNBC, asking not to be named because they were not authorised to discuss the details publicly. More commitments are expected to arrive in the coming weeks, according to the Wall Street Journal’s reporting, and the final size of the first close has not yet been set.

A Smaller Round, Not a Cheaper One

The first thing to understand about OpenAI’s trimmed round is what did not change. The price stayed where it was. OpenAI is still asking investors to pay $1.25 trillion for a stake in the company, the same valuation it settled on last week after backing away from $1.4 trillion. What shrank was the amount of money it is asking for: $20 billion instead of $30 billion.

That distinction matters, because it tells us where the resistance sits. Investors have not, on the evidence of these reports, rejected OpenAI’s valuation outright. They have declined to write cheques as large as the ones OpenAI wanted. The company set a Friday deadline for commitments and, according to the Wall Street Journal, had about $11 billion in hand when that deadline arrived — less than half of the original target and little more than half of the revised one.

The shortfall is not a rounding error. Ten billion dollars is a large sum even by the standards of the artificial intelligence industry, and it represents a third of the round OpenAI originally sought. When a company of OpenAI’s standing cuts its target by a third in the space of a month, and still expects its first close to come in below the reduced figure, the market is sending a message about appetite, not about the company’s technology.

That message has been building for weeks. The Philadelphia Semiconductor Index shed about $1.6 trillion in value in less than two weeks in October, according to Reuters reporting at the time, and several companies pulled or paused listings as conditions deteriorated. CoreWeave, the cloud computing provider whose shares and debt tumbled as investors questioned its borrowing, became the cautionary tale of a market that had stopped taking growth at any price for granted. OpenAI’s fundraising has now run directly into the same scepticism.

Analysis: Why It Matters

1. The AI spending boom is being repriced in public

For most of this year, the artificial intelligence industry operated on a simple assumption: the money would always be there. Companies announced computing commitments in the hundreds of billions of dollars, chipmakers’ shares climbed, and private valuations rose in step. October broke that rhythm. Alphabet lost roughly $500 billion in market value in a single day after its results, Intel recorded its worst day since 1974, and the Nasdaq fell almost 3 per cent in one session.

OpenAI’s trimmed round is the private-market version of the same repricing. Public investors have already marked down the shares of the companies building and supplying AI infrastructure. Now private investors are marking down, in effect, how much new capital they are willing to commit to the company at the centre of the boom. The valuation has held so far, but the size of the cheque has not, and that is how a repricing usually begins: with smaller commitments, not lower prices.

2. Anthropic’s IPO has changed the competitive arithmetic

OpenAI did not set out to raise $30 billion in a vacuum. It set out to raise it before Anthropic went public, because both companies draw on the same limited pool of large investors, and because a successful Anthropic listing would give that rival a currency — publicly traded shares — that OpenAI does not yet have. The Financial Times explicitly linked the two events, and the timing of the fundraising deadline, set for the Friday before Anthropic’s roadshow gathers pace, was plainly deliberate.

The problem for OpenAI is that the race has now become a contest over the same dollars at the same moment that those dollars have grown scarcer. Anthropic’s filing showed a company growing extraordinarily fast — revenue up from $1.2 billion in the first half of 2025 to $16.3 billion a year later — but also carrying an $80.7 billion headline loss and $587 billion of computing commitments and leases. Investors weighing both opportunities must now decide how much capital the entire frontier-model business deserves, and the answer, for now, is less than the companies hoped.

3. Gulf money is becoming the backstop

The composition of the round is as revealing as its size. Investors from the United Arab Emirates, including the state-backed fund MGX, are expected to lead it, and a separate commercial deal would give OpenAI the option to lease newly built computing capacity in the region. SoftBank, which completed a $30 billion investment in OpenAI on 1 October and now holds about 13 per cent of the company, is also expected to take part.

This is a pattern that has repeated across the AI industry: when traditional venture and public-market investors hesitate, sovereign wealth funds and state-backed vehicles step in. Gulf capital has become the marginal buyer of the AI boom, funding data centres, chip purchases and now equity rounds. That brings OpenAI the money it needs, but it also concentrates its dependence on a small number of large, state-linked investors whose priorities may not always align with those of a company preparing for a public listing.

4. The compute bill is the real constraint

Behind every figure in this story sits a single, stubborn fact: training and running frontier AI models costs staggering amounts of money, and the bill keeps growing. OpenAI has committed to about $600 billion of computing spending by 2030. Broadcom has been seeking more than $50 billion to finance the custom chips it designs with OpenAI. The hyperscalers — Microsoft, Alphabet and Amazon — have between them committed roughly $700 billion of capital expenditure in 2026 alone, much of it debt-financed.

A $20 billion round, even if fully subscribed, covers only a fraction of OpenAI’s computing commitments. The company will need to return to the market again, and probably soon, unless its revenue growth accelerates fast enough to fund the spending from operations. Its pitch — $50 billion of annualised revenue now, $70 billion by year-end — is designed to persuade investors that the gap will close. But revenue measured on an annualised basis is a projection, not a bank balance, and the investors who reduced their allocations this week were evidently not persuaded enough to write the cheques OpenAI wanted.

5. The IPO ladder has grown steeper

OpenAI’s chief financial officer, Sarah Friar, has pointed to a likely listing in 2027, and the company has been building towards that moment all year: the March mega-round, the Google Cloud distribution deal, the succession of model launches. A public listing would give it access to the deepest pool of capital in the world, and a publicly traded share price would settle, one way or another, the argument about what the company is worth.

But the path to that listing has grown harder. Anthropic will list first, and its debut will set the benchmark against which OpenAI is judged. If Anthropic’s shares trade well, OpenAI’s $1.25 trillion valuation will look like a bargain and its next round will fill easily. If they do not, the questions that surfaced this week — about spending, about returns, about how much capital the AI business can absorb — will only grow louder. The trimmed round is a warning that the market is no longer willing to take OpenAI’s story on trust alone.

What to Watch Next

1. The first close: whether OpenAI’s first close lands near $20 billion or well below it, and whether the planned retail offering for wealthy individuals materialises to top it up.
2. Anthropic’s listing: the price range Anthropic sets when its roadshow begins, and how its shares trade in mid-November, will set the valuation benchmark for the entire frontier-model sector.
3. More commitments: the Wall Street Journal reported that further commitments are expected in the coming weeks, so the final tally for the round may still rise above the $11 billion secured by Friday’s deadline.
4. OpenAI’s revenue: whether the company’s annualised revenue reaches the $70 billion it has pitched to investors by the end of the year, and how much of that growth survives closer scrutiny of how revenue is counted.
5. The compute bill: further announcements on chip financing and data-centre deals, including Broadcom’s reported effort to raise more than $50 billion, will show whether the infrastructure build-out is slowing or simply changing funders.

Sources

• TechCrunch — OpenAI reportedly lowers funding target for new round (31 October 2026)
• The Hindu BusinessLine (Bloomberg) — OpenAI funding target cut by $10 billion as AI slumps (31 October 2026)
• CNBC (via Longbridge) — OpenAI pares fundraising goal, now seeking up to $20 billion in latest round (31 October 2026)
• The Inference — OpenAI trimmed its round to $20 billion at a $1.25 trillion valuation, with $11 billion committed (31 October 2026)
• Dealroom — OpenAI has only about $11B committed after cutting its round target by $10B as the AI sell-off bites (31 October 2026)