OpenAI raises $11B at $1.25T valuation

OpenAI has secured approximately $11 billion in new funding, closing the first tranche of a round priced at a $1.25 trillion pre-money valuation. According to 24/7 Wall St., the cash reached the company’s accounts by Friday, November 6, 2026. This amount represents roughly 37% of the company’s original target, which reports suggest was initially set at $30 billion or more. The company’s CFO, Sarah Friar, confirmed the valuation in a television interview, noting that the price is nearly 50% higher than the $852 billion valuation achieved in March.

The funding gap

The round ended up smaller and cheaper than initially sought, a shift attributed to a recent sell-off in AI stocks. While OpenAI initially aimed for a $1.4 trillion valuation, some investors reported the ask started as high as $1.5 trillion. Friar disputed the higher figure, stating it originated from media reports rather than the company. The closed amount leaves a significant portion of the target unfunded, with reports indicating the total could eventually reach $20 billion if a second tranche of up to $9 billion closes. However, the lead investors and specific terms for this follow-on have not been disclosed.

Business performance metrics

Despite the valuation adjustment, OpenAI reports strong operational growth. Friar stated that the business grew 70% quarter-over-quarter in the third quarter, with the enterprise segment doubling in size. The company now serves 1.2 billion weekly ChatGPT users and has achieved an advertising run rate of $1 billion by August. Revenue is split approximately 50/50 between consumer and enterprise customers. When asked about the broader economic climate, Friar asserted, “The demand for AI is real,” though she declined to provide specific revenue dollar figures.

Impact on Microsoft and NVIDIA

The funding structure has direct implications for OpenAI’s major partners. Microsoft, which holds a significant stake in OpenAI, saw gains on the investment add $207 million to its GAAP net income in the September quarter. However, a lower valuation means reduced future accounting gains on the stake. NVIDIA is more exposed to the funding flow because OpenAI’s compute commitments rely on the company’s ability to raise capital. NVIDIA has stated that OpenAI’s existing and planned commitments account for about 12 gigawatts of its compute. The company’s management has warned that frontier labs are growing faster than their balance sheets can support, a strain evident in the staged nature of this funding round.

Market context and competition

The timing of this round coincides with a broader reassessment of AI valuations. Rival Anthropic is planning to list on Nasdaq in mid-November, with some investors now valuing it at approximately $1.5 trillion, down from earlier expectations of $2 trillion. This downward pressure on private valuations reflects a market that is becoming more selective about growth stories. Microsoft’s stock closed at $530.61, down 0.99%, while NVIDIA rose 2.78% to $186.64, though it remains down 21.4% over the past month. The divergence in stock performance highlights the differing exposures of these companies to OpenAI’s financial health.

What developers should watch

For developers and enterprise users, the key takeaway is that OpenAI’s growth is being funded in stages, which could impact the pace of infrastructure expansion. The 12 gigawatt compute commitment suggests massive scaling, but the reliance on future funding tranches introduces uncertainty. The 50/50 revenue split between consumer and enterprise indicates that OpenAI is increasingly focused on B2B use cases, which may drive more enterprise-grade features and API stability. However, the lower valuation compared to initial targets suggests that investors are demanding more proof of profitability and sustainable growth before committing additional capital.

Key milestones ahead

Two upcoming events will test the current narrative. First, whether OpenAI’s round reaches the full $20 billion target will indicate investor confidence in the company’s long-term viability. Second, NVIDIA’s earnings report on Tuesday, November 17, will provide insight into the demand for AI infrastructure. If NVIDIA meets its guidance of $108.0 billion in third-quarter revenue, it would support the argument that demand still exceeds supply. Conversely, a miss could signal a broader slowdown in AI adoption. The outcome of these milestones will likely influence the valuation of both OpenAI and its competitors, setting the tone for the next phase of the AI industry’s growth.