OpenAI’s $20 billion revenue gap is a counting problem, and that’s the problem

OpenAI has told investors its revenue for this year will reach $50 billion, a projection based on sales through the end of September, The Guardian reports. In material provided to investors last month, the company had signaled $70 billion. The $20 billion difference hit the market on Thursday: the Nasdaq closed down 1.4%, Nvidia fell 2.9%, Micron 4.8% and Oracle 5.5%.

The Guardian says the discrepancy arose when OpenAI’s investors tried to compare its figure more directly with the way Anthropic measures projected revenue. Anthropic counts sales that run through cloud partners such as Amazon’s AWS and Google Cloud. OpenAI doesn’t.

These figures are run-rates. A company takes revenue from a short stretch, a month or a quarter, and multiplies it out to a year, as MarketWatch explains. The analysts it quoted said the shortfall reflects differences in how the figure is reported and that the report caused “undue concern.”

They may be right about demand. The two most closely watched numbers in AI are projected revenue figures from two private companies, each built on its own rules, and investors have been treating them as a running score. Anthropic hit $65 billion in forecast revenue by the end of July, by its own counting. Until this week, a reader setting that next to OpenAI’s $70 billion signal was comparing two different measurements.

Chip stocks trade on these figures because they’re the best available read on whether AI spending turns into AI sales. When a definitions fix knocks the biggest chip stocks down in a single session, the market is pricing a number nobody standardized.

OpenAI is in early talks to raise $30 billion at a valuation of about $1.4 trillion. Its last round, in March, raised $122 billion at $852 billion. Anthropic, which raised $65 billion at a $965 billion valuation two months after that, is expected to push ahead with an initial public offering as soon as next month. Last month, Sam Altman said OpenAI wouldn’t go public this year, citing safety concerns.

A public company reports revenue under accounting rules, audited, every quarter, and a run-rate becomes a footnote next to the real figure. Anthropic’s filing would show investors what its cloud-partner sales actually look like on that basis. OpenAI, staying private, can keep reporting the version it chooses to the investors it chooses.

Until one of them files, the AI revenue race is two companies grading their own tests. SoftBank, which has made a $65 billion investment in OpenAI, is meanwhile seeking to raise up to $100 billion from Gulf states to scale up its AI bets, The Guardian reports, citing the Financial Times.

Sources

• The Guardian: OpenAI projected to bring in $20bn less in revenue than expected
• MarketWatch: Micron, Nvidia and AI chip stocks fall as report on OpenAI’s revenue causes ‘undue concern’