OpenAI, the creator of ChatGPT, is gearing up to launch its Initial Public Offering (IPO) this year. This financial manoeuvre would represent a pivotal shift for a project originally designed for the “common good” towards a market-driven logic. Established in 2015, OpenAI started out amidst growing anxiety regarding artificial intelligence (AI). Founded by Sam Altman and Elon Musk, the tech company adopted a non-profit structure and made no secret of its goal to develop AI that is “beneficial to humanity” and prevent it from remaining in the hands of a few dominant players.
This ambition distinguished it from tech giants like Google, Microsoft, Meta, and Amazon, which were built on proprietary models and rent-seeking effects.
In contrast, OpenAI intended to champion the general public interest by emphasising open research and sharing knowledge. However, this orientation – symbolised by its name – quickly collided with a structural constraint: the astronomical cost of generative AI.
Massive costs
Unlike traditional software, where marginal costs tend towards zero (for example, the millionth copy of Windows costs Microsoft nothing), generative AI requires massive infrastructure.
Every interaction mobilises computing resources, energy, and specialised equipment. A standard ChatGPT query, consisting of one question and one answer, costs between $0.01 and $0.10. Similarly, generating a high-definition image can cost between $0.10 and $0.20. While these amounts seem negligible in isolation, they become staggering when scaled to the billions of daily queries seen in 2026.
This is explained by the underlying infrastructure, particularly the Graphics Processing Units (GPUs) supplied by players like Nvidia. These chips can cost tens of thousands of dollars to purchase and several dollars per hour via cloud access.
OpenAI, like its competitors, depends on tens of thousands of these GPUs running continuously in massive data centres. According to some estimates, the necessary investments will reach hundreds of billions by the end of this decade.
As early as the late 2010s, it became clear that a purely non-profit model could not meet such capital intensity. This is why OpenAI adopted a hybrid status in 2019, allowing it to raise funds while maintaining control through a foundation. It was a first foray into the market economy, albeit one tempered by the ambition to resist investor demands.
Brutal acceleration with ChatGPT
However, at the end of 2022, the chatbot ChatGPT radically changed the game, attracting 100 million users in just two months, before surpassing 900 million weekly users by early 2026.
OpenAI’s revenue surged from approximately $200 million (€173.15 million) in 2022 to over $10 billion (€8.65 billion) in 2025 – a sixty-fold increase in three years.
This exponential growth was accompanied by the implementation of a business model with multiple revenue streams. For individuals, OpenAI offers paid subscriptions (ranging from $20 to $200 per month). However, the bulk of the revenue comes from enterprises, via subscriptions priced between $25 and $60 per user per month. A company with 10,000 employees thus represents several million dollars in annual revenue.
Corporate money
OpenAI additionally bills for the use of its models by companies that integrate them directly into their own solutions. Every use is metered, often on a massive scale. An application processing a million queries a day can generate tens of thousands of dollars in monthly billing.
Finally, a growing portion of revenue comes from strategic agreements, notably with Microsoft, which integrates OpenAI technologies into its products under the Copilot brand.
It is the sum of these flows – subscriptions, licences, third-party usage, and partnerships – that allowed OpenAI to reach approximately $1 billion in monthly revenue in 2025. Yet, this commercial rise masks an intrinsic economic fragility.
A gigantic cash-burning machine
Despite sharply rising revenues, OpenAI remains structurally loss-making. In the first half of 2025, the company reportedly generated approximately $4.3 billion in revenue while recording losses between $7 billion and $13 billion – more than $2 billion in losses every month. In total, cumulative losses could exceed $140 billion (€121.19 billion) between 2024 and 2029.
This drift is explained by the very nature of OpenAI’s business model, where every interaction incurs a cost alongside gargantuan necessary investments. Beyond infrastructure, Research and Development (R&D) is a major expense. To stay in the technological race against an increasingly competitive environment, OpenAI reportedly invested nearly $16 billion in R&D in 2025 alone.
To this is added the cost of human resources, which is sometimes extraordinary. While base salaries for the most in-demand AI experts range from $250,000 – $700,000 per year, their total compensation – including stock and bonuses – frequently exceeds $1 million. In some cases, annual compensation even exceeds $10 million. Here again, bidding wars from competitors like Meta force OpenAI to match these offers for fear of seeing its key talent vanish.
Nearing bankruptcy?
In short, OpenAI’s business is not enough to cover its costs, to the point that some analysts suggest that at this rate, it could be forced to file for bankruptcy as early as 2027. Recourse to external financing is therefore indispensable to cover these losses.
To sustain its growth, OpenAI has already raised approximately $58 billion since its inception, including more than $13 billion from Microsoft. In 2025, an exceptional funding round reportedly raised up to $40 billion more, pushing its valuation to several hundred billion dollars.
At the end of March 2026, a new $122 billion funding round – notably involving Amazon ($50 billion), Nvidia, and SoftBank ($30 billion each) – brought the valuation to $852 billion (€737.6 billion). Yet, these amounts remain insufficient given the requirements.
Industrial dependency
Dependency on industrial partners appears particularly problematic. Microsoft provides OpenAI with its cloud infrastructure via Azure, while Nvidia plays a key role upstream by providing GPUs. Much like the Gold Rush era, when shovel sellers grew rich at the expense of prospectors, it is the infrastructure providers in the AI sector making a fortune, not the model designers.
In practice, every AI query generates revenue for infrastructure providers, amounting to a form of “invisible tax” captured upstream.
In 2025, Nvidia generated nearly $73 billion in net profit on approximately $130 billion in revenue, and its stock market valuation is 1.5 times higher than the entire Paris stock exchange!
Governance missteps
OpenAI’s economic tensions have spilt over into its corporate governance. The hybridisation of a public interest mission with private financing mechanisms resulted in a complex structure. A non-profit foundation controls a for-profit “public benefit corporation”, which is funded by investors and tasked with raising capital and developing activities – all while theoretically remaining subordinate to the foundation’s public interest mission. This construction, designed to avoid purely financial logic, quickly fuelled tensions between different stakeholders.
Elon Musk’s departure in 2018 was the first signal of a strategic disagreement. In 2020, several researchers left OpenAI to found Anthropic, citing differences over safety and governance. However, it was primarily the crisis of November 2023 that fully revealed the system’s fragilities, when the board of directors suddenly announced the firing of Sam Altman, citing a lack of transparency in his communications.
Within hours, the situation spiralled into an open crisis. Nearly all employees threatened to leave the company if Altman was not reinstated. Microsoft, the main partner and investor, publicly supported Altman and even discussed the possibility of hiring him and his teams. Faced with this pressure, the board was forced to reverse its decision within days. Sam Altman was reinstated, and the board’s composition was profoundly overhauled. This episode highlighted internal tensions, specifically the difficulty of making divergent logics coexist within the same company: ethical posturing, industrial imperatives, and investor demands.
Intensifying competition
In addition to these internal constraints, competitive intensity is particularly fierce.
Google, the inventor of generative AI, is making rapid progress with Gemini. Anthropic, with Claude, has established itself in certain segments, particularly programming, while emphasising safety.
China’s DeepSeek has claimed to use less expensive processors. France’s Mistral AI advocates for a frugal approach and European digital sovereignty. In a sign of this shifting landscape, Apple, which initially partnered with OpenAI to include ChatGPT for certain Siri features – has chosen to replace it with Gemini.
In this context of ecosystem reorganisation, OpenAI’s position, while still central, is being challenged. Intensifying competition reinforces the need for ever-greater financial resources.
The stock market: lifeline or mirage?
OpenAI’s Initial Public Offering (IPO) is presented as a response to these constraints: a way to fund massive investments and consolidate a weakened competitive position. An IPO could raise between $50 billion and $100 billion by selling 10% to 20% of the capital. Such an operation would constitute one of the largest in the history of financial markets.
However, this transformation involves delicate trade-offs. A listed company is subject to profitability and transparency requirements that may clash with the experimental nature of artificial intelligence. Added to this is the persistent dependence on Microsoft and Nvidia, which limits the company’s strategic autonomy.
Most importantly, there is no indication that an IPO would suffice to resolve OpenAI’s structural problems. At best, without a significant shift in the business model, it would only delay its bankruptcy by a few years. The economic model of generative AI remains fundamentally unstable today.
A question beyond OpenAI
Beyond the case of OpenAI, one can legitimately question the current functioning of an economy dominated by tech giants.
Artificial intelligence is establishing itself as an essential infrastructure whose effects far exceed the economic sphere. For some analysts, control over AI now carries the same geostrategic importance as the possession of nuclear weapons.
Consequently, a civilisational question arises: can we entrust the development and direction of such a technology solely to financial markets? Can we imagine Elon Musk or Mark Zuckerberg personally owning the equivalent of one or more atomic bombs? OpenAI’s IPO will not provide the answer alone. However, it will constitute one of the first large-scale tests.
- is a Professor of Strategy, CentraleSupélec, ESCP Business School
- This article first appeared in The Conversation
