OpenAI Reportedly Cuts Funding Target to About $20 Billion at $1.25 Trillion Valuation
The Financial Times reports OpenAI is now seeking about $20 billion, down from $30 billion. The valuation target, already lowered from $1.4 trillion, stays at $1.25 trillion.
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OpenAI has cut the target for its latest funding round to about $20 billion, down from $30 billion, while keeping a $1.25 trillion valuation, the Financial Times reported on October 30. DailyMech could read only the FT's headline and summary, which are behind a paywall, and OpenAI has not commented publicly.
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What the FT reported
The FT's headline reads "OpenAI slashes funding target by $10bn as tech anxieties mount." Its summary says the ChatGPT maker "is now seeking about $20bn at a $1.25tn valuation as it tempers its ambitions."
We could not read the full article, so we can't report its sourcing, the investors involved or OpenAI's reasons. The figure has not been independently confirmed by another outlet we could find.
The change would affect the amount OpenAI raises, not its valuation. The valuation was cut earlier in October.
How the round has changed
| Date | Report | Round size | Valuation |
|---|---|---|---|
| Oct 20 | Reuters (via The Straits Times) | About $30 billion | More than $1.4 trillion |
| Oct 22 | FT | $30 billion | Cut to $1.25 trillion after resistance to $1.4 trillion |
| Oct 22 | Bloomberg | Around $30 billion | $1.25 trillion, down from $1.4 trillion |
| Oct 22 | CNBC | Up to $30 billion | $1.25 trillion pre-money |
| Oct 30 | FT | About $20 billion | $1.25 trillion |
On October 20, Reuters reported that OpenAI was racing to secure investor commitments before rival Anthropic's expected IPO, in a round of about $30 billion that could value it at more than $1.4 trillion. SoftBank, Abu Dhabi-based MGX and other existing backers were in talks to join, one source said.
Two days later, Bloomberg reported that OpenAI had shifted the valuation under discussion by $150 billion, to $1.25 trillion, according to people familiar with the talks. It said the round was still around $30 billion, that details could change, and that Coatue Management was in talks to co-lead. OpenAI declined to comment. The FT reported the same day that OpenAI had cut its valuation target after resistance from some investors to the $1.4 trillion price.
CNBC also reported on October 22 that OpenAI was close to a round of up to $30 billion at a $1.25 trillion pre-money valuation, which means it excludes the new money. CNBC said investors from the United Arab Emirates and Coatue were leading, and that the final size of the round was still being determined.
The IPO connection
CNBC said OpenAI was positioning the financing as an "opportunistic" bridge ahead of a potential IPO. OpenAI confidentially filed its prospectus with the Securities and Exchange Commission in June. CFO Sarah Friar told employees in August that OpenAI "will be a public company in 2027," CNBC reported.
Investors familiar with the company told Reuters that OpenAI also needs capital for its infrastructure commitments and to strengthen its balance sheet in case weaker IPO markets delay its planned 2027 listing.
For context, OpenAI raised $122 billion in March at an $852 billion valuation, including the new money.
Why it matters
If the FT's report is accurate, OpenAI would raise a third less than it planned while holding its valuation. That could suggest weaker investor demand, but the FT's full reasoning was not available to us. Its headline links the cut to "tech anxieties." Reuters reported on October 20 that AI valuations were under pressure, with volatile tech stocks, rising bond yields and several AI-related listings pulled or paused.
What to watch:
- Whether OpenAI or its investors confirm the round's final size.
- Which investors lead and sign, after CNBC named the UAE investors and Coatue.
- Whether the round closes before Anthropic's expected IPO.
More coverage is on our Artificial Intelligence hub.
How we reported this
The $20 billion figure comes from the FT's October 30 headline and summary; the article is paywalled and we did not read it in full. Earlier details come from CNBC, Reuters (via The Straits Times) and Bloomberg (via Business Standard's syndicated copy). An investor list circulating on X, including Sequoia, could not be verified and was removed. The table compiles those reports.
Published and fact-checked October 30, 2026.
Sources
- Financial Times, OpenAI topic page, listing "OpenAI slashes funding target by $10bn as tech anxieties mount," Oct. 30, 2026: https://www.ft.com/stream/e3402603-d253-4aa1-ac4d-fc9bdbf4ccb8
- Financial Times, "OpenAI trims valuation target to $1.25tn after pitching higher price," Oct. 22, 2026: https://www.ft.com/content/bb564eb1-79d4-4694-aa24-1155202a9abc
- Bloomberg, Shirin Ghaffary and Rebecca Torrence, Oct. 22, 2026: https://www.bloomberg.com/news/articles/2026-10-22/openai-shifts-value-to-1-25-trillion-as-funding-talks-finalize (verified via Business Standard's syndicated copy: https://www.business-standard.com/world-news/openai-shifts-valuation-to-1-25-trillion-as-funding-talks-near-final-stage-126102300159_1.html)
- CNBC, "OpenAI nears up to $30 billion funding round at $1.25 trillion valuation led by UAE investors," Kate Rooney and Ashley Capoot, Oct. 22, 2026: https://www.cnbc.com/2026/10/22/openai-funding-round-uae-investors.html
- Reuters via The Straits Times, "OpenAI seeks to accelerate fund-raising ahead of Anthropic IPO, sources say," Oct. 20, 2026: https://www.straitstimes.com/business/openai-seeks-to-accelerate-fundraising-ahead-of-anthropic-ipo-sources-say
DailyMech used AI tools to help research and draft this article; it was fact-checked by our editors.