OpenAI's annual revenue has exceeded $40 billion! It has gained strong growth momentum just before a potential IPO.

According to insiders, OpenAI's current annualized revenue has exceeded $40 billion, roughly doubling since the end of 2025. This performance bolsters the company's confidence as it prepares for an IPO. Sources indicate that OpenAI has seen accelerated revenue growth in recent months, partly due to the rapid expansion of its artificial intelligence (AI) programming software business. The revenue growth also reflects continued momentum in subscription sales and its nascent advertising business. Meanwhile, OpenAI's core consumer business continues to grow. OpenAI co-founder and president Greg Brockman stated that the company's annualized revenue grew by over 20% month-over-month in July. Recently, there has been a notable increase in demand for AI agents, with flagship products including the programming tool Codex and the general assistant ChatGPT Work. At the same time, OpenAI has lowered prices on some models to respond more flexibly to challenges posed by competitors such as Anthropic. On Thursday, OpenAI appointed its second new chief revenue officer in less than a year and brought on a cybersecurity executive to help drive sales growth. OpenAI is currently in fierce competition with Anthropic for more enterprise clients. Both companies have secretly filed for IPOs, with Anthropic expected to go public as soon as this fall, potentially ahead of OpenAI. Anthropic was once seen as a follower, but with its AI tools capable of simplifying complex tasks, including programming, it is gaining market attention. In May, Anthropic announced that its annualized revenue had surpassed $47 billion, though the two companies may calculate this metric differently. Preparing for a potential IPO by repurchasing $7 billion in employee stock In addition to its strong performance, recent news about OpenAI's repurchase of $7 billion in employee stock suggests that the company may be preparing for its initial public offering (IPO). Insiders revealed that this buyback deal involves repurchasing shares from current and former employees, rather than seeking external investors as it has in the pastpreviously, OpenAI invited investors such as Thrive Capital and SoftBank Group to purchase shares held by employees. Sources claim that this transaction values the startup at $852 billion, consistent with the valuation during its latest funding round. It is reported that this stock buyback deal has been in preparation since OpenAI completed a record $122 billion funding round in March. The transaction will help alleviate recent liquidity pressures, allowing employees to sell some of their holdings and realize partial cash outs before the company potentially conducts a large-scale IPO. Secondary market stock sales have become part of OpenAI's pre-IPO strategy. Last October, OpenAI completed a $6.6 billion stock buyback transaction, when the company's valuation reached $500 billion. Additionally, OpenAI had earlier completed a $1.5 billion stock buyback transaction in 2024. The longer a company takes to go public, the more problematic employee stock options and restricted stock can become in terms of taxation and cash flow. Caplight CEO Javier Avalos noted that OpenAI employees have fully vested and held stock for some time, and at this stage, the company feels pressure to provide liquidity for employees. The company-led employee stock sale offer is a primary channel for employees to monetize their equity before the IPO. Moreover, some employees also sell shares through separate secondary transactions. However, employee stock sales can only alleviate internal liquidity pressures and do not solve the capital requirements for cutting-edge model companies. The Information noted that for OpenAI and its competitor Anthropic, an IPO could enable them to raise tens of billions to train and operate models. Both companies expect to spend hundreds of billions on computing services in the future. Not all employees are willing to sell before the IPO. The Information mentioned that the employee stock sale at Anthropic earlier this year ultimately raised less than the previously reported investor interest of $5 billion to $6 billion. One possible reason is that some employees believe selling after the IPO would be more profitable. Meanwhile, OpenAI and Anthropic have also been cracking down on unauthorized stock sales, such as private transfers via special purpose vehicles. Controlling equity trading order is part of what AI companies preparing for an IPO or continuing to raise significant funds need to address before entering the public market. IPO timeline may be pushed back to 2027 Additionally, it has been reported that OpenAI has significantly backed away from its initial ambition of being "IPO-ready by this fall" and currently clearly leans toward postponing the IPO timeline until 2027. This delay reflects the collision between CEO Sam Altman's insistence on a baseline valuation of $1 trillion and the harsh realities of the market. The sharp volatility of SpaceX's (SPCX.US) stock price post-IPO is posing a direct psychological deterrent to OpenAI's IPO plans. Bankers advising OpenAI on its IPO have expressly warned that recent sharp fluctuations in tech stocks and SpaceX's significant stock price drop after its IPO could severely undermine retail investors' enthusiasm for buying OpenAI's shares. An insider revealed that OpenAI's advisors candidly communicated to the company last week that retail investors may lack enthusiasm for its stock. OpenAI's valuation predicament is at the core of the delayed decision. In March 2026, OpenAI completed a $122 billion funding round, raising its post-money valuation to $852 billion, making it the most highly valued private tech company globally. However, this achievement falls short of Altman's psychological expectations. Insiders indicate that Altman has been urging the advisory team, including bankers and lawyers, to find ways to push the company's IPO valuation up to $1 trillion. The advisory team proposed two options to Altman: one is to delay the IPO until 2027, waiting for market conditions to improve while allowing the company's financial performance to approach the $1 trillion valuation target; the other is to go public by the end of 2026 but accept a lower valuation. According to a person who has interacted with Altman, when the advisors presented this option, Altman stated that any plan that brought the valuation below $1 trillion was "not feasible." Meanwhile, OpenAI's financial situation is also testing investors' patience. The company reported a net loss of up to $38.5 billion last year, primarily due to substantial expenditures on computing infrastructure, R&D, and corporate restructuring. According to The Information, OpenAI burned through $3.7 billion in cash in the first quarter of 2026, exceeding half of its $5.7 billion revenue during that same period. The company anticipates investing $600 billion in computing and hardware by 2030. Recent months have seen some of OpenAI's major investors privately express concerns about the company's rapid cash burn in relation to its growth, while other investors have hedged their bets on OpenAI by providing funding to Anthropic. OpenAI's delay is not an isolated case. Analysts suggest that the IPO of large model enterprises, originally scheduled for the second half of 2026, may be postponed until the first half of 2027 due to decreased market risk appetite and uncertainties in the liquidity environment. The adjustment of the IPO timeline means that the highly anticipated IPO plan will be significantly delayed compared to previous market expectations of this fall. The most straightforward interpretation of the 2027 timeline is that OpenAI is capable of waiting. By delaying, the company can continue to expand usage, refine pricing, and seek a more stable business mix among consumer products, enterprise tools, and infrastructure partners before entering the public market and facing quarterly discipline constraints.