Now that OpenAI can be a for-profit company, it can have an IPO. Reuters reports that the target market capitalization of the transaction is a valuation of $1 trillion, which it will use to raise $60 billion. The IPO could happen as early as the second half of 2026, or could be delayed a quarter or two to 2027, depending on the broader stock market. At $1 trillion, it would be worth as much as Berkshire Hathaway.
If anyone needs proof that the AI-driven stock market is frothy, it’s this $1 trillion figure. In the first half of the year, OpenAI lost $13.5 billion on revenue of $4.3 billion. It is on track to lose $27 billion this year. One estimate shows OpenAI will spend $115 billion by 2029. It may not make money until then.
The risk to the $1 trillion figure falls into several categories. The first is whether the company will ever make money. To some extent, this depends on how many other companies will make money from artificial intelligence. Most people use it for free. AI has already been integrated into products from large technology companies such as Microsoft, Amazon and Meta. Between them, they have committed to investing tens of billions of dollars, most of which will go into huge data centers. AI revenue is not the same as profit. It could take years for tech companies to prove that AI integration can actually make money.
Another potential hurdle is how long financial and utility companies will support AI infrastructure. Investment giant Brookfield is investing billions of dollars in data centers. Utilities like Constellation Energy are also making big investments. If AI does not produce a profitable business model, these companies will have to answer to shareholders, who will only be patient for so long.
AI faces another hurdle it may not be able to overcome. Their data centers are energy guzzlers. Preliminary evidence suggests this raises residential electricity rates. There has already been setback. In some parts of the country, AI competing for electricity is already part of political campaigns. NBC News recently noted that candidates are facing rising electricity prices in Pennsylvania and Maryland. The news network reported that the issue could be part of the midterm elections.
Another question about OpenAI is whether AI valuations in general can hold up. Nvidia Corp. (NASDAQ: NVDA) was the first public company to have a $5 trillion valuation. This is based entirely on the future success of the AI economy. Its share price has risen 1,552% in the last five years. The broader market rose 111% during the same period. Investors have increasingly begun to compare this to the dot-com bubble. If that comparison holds true, Nvidia stock could fall 50% or more. This will reverberate across the AI industry and negatively impact the valuation of an OpenAI IPO.