The nonprofit artificial intelligence developer that created ChatGPT expects to lose about $5 billion this year as it seeks $7 billion in new funding to turn its core business into a for-profit corporation.
OpenAI’s monthly revenue reached $300 million in August, up 1,700% since the start of 2023, and it projects about $3.7 billion in sales this year, the New York Times reported Friday, citing financial documents given to potential investors.
OpenAI also anticipates that its revenue would more than triple to $11.6 billion next year, the Times said.
This year’s anticipated loss stems from costs related to running Open AI’s services and other expenses, including employee salaries and office rent, a financial expert who reviewed the documents told the Times.
But those figures don’t account for several large expenses that include equity-based compensation, the Times said.
A person close to OpenAI confirmed the revenue and loss numbers, according to CNBC.
The reports came two days after three top OpenAI executives, including chief technology officer Mira Murati, announced their resignations, and Reuters reported that it was working on a plan to restructure its core business into a for-profit corporation.
OpenAI’s latest investment round values the company at $150 billion, which the Times said was among the highest ever for a private tech company.
Chief Financial Officer Sarah Friar told investors in a Thursday email that the round is oversubscribed and will close by next week, according to CNBC.
The New York City-based Thrive Capital venture capital firm is leading the round and plans to invest $1 billion, CNBC reported last month.
Thrive was founded by billionaire Joshua Kushner, a son of real-estate developer Charles Kushner and the younger brother of Jared Kushner, a son-in-law of ex-President Donald Trump and former White House adviser.
In December 2020, Trump pardoned Charles Kushner for filing false tax returns, lying to the Federal Election Commission and retaliating against a witness in a 2004 case that involved secretly recording his brother-in-law and a prostitute in a New Jersey motel room.
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