OpenAI, the company behind ChatGPT, is jumping into the mega-IPO stock-trading race, filing a confidential S-1 with the Securities and Exchange Commission. With SpaceX at bat for a Friday opening and Anthropic on deck, OpenAI is in the queue but has not set a date for its debut.
“We have not decided on timing yet; it may be a while because there are things we want to do that are likely easier as a private company,” OpenAI said in a statement posted on its website. “But it’s a complicated set of trade-offs, and this gives us the option to go public sooner if that ends up being best.”
It may feel as if OpenAI burst onto the tech scene overnight, but the company’s roots as a nonprofit date back to 2015, when it introduced itself as an artificial intelligence research company. It aimed to “advance digital intelligence in the way that is most likely to benefit humanity as a whole, unconstrained by a need to generate financial return.”
Recently valued at roughly $852 billion and potentially seeking a public valuation of $1 trillion or more, a publicly traded OpenAI would likely face pressure from investors to deliver strong financial returns.
Here are six things to know before you buy OpenAI once it goes public.
1. Is the IPO market getting crowded?
With OpenAI, SpaceX, and Anthropic all expected to premiere within a relatively short period, investors may wonder whether the market is becoming oversaturated with big-name equity bets. Deutsche Bank chief global strategist Bankim Chadha told Yahoo Finance that the S&P 500 has absorbed large IPOs in the past without difficulty.
“It sounds like very compelling logic that these huge IPOs would suck out all the liquidity, and then crowd out all the other stocks,” Chadha said. “Take a look at how the S&P 500 behaved during waves of issuance around big IPOs, as we’re talking about now. When the market is very strong, issuance then picks up, and the market basically remains strong.”
2. Can OpenAI monetize ChatGPT?
Consumers’ growing subscription overload may be a barrier to monetizing ChatGPT. Currently, subscription prices range from free with limited access to $100 per month for power users. Out of an estimated 800 million users, only 5% pay, according to the Financial Times.
OpenAI has experimented with pay-per-click ads within ChatGPT query results. Forrester Research found that AI users are “generally sensitive to ads blurring the line between helpful information and paid promotion.” Users are also wary of personal information being tapped without their permission. However, a majority of those polled (83%) said they would be willing to tolerate the ads in exchange for a free service.
3. The AI boom comes with a massive price tag
Data centers may not be popular with the “not in my backyard” crowd, but perhaps more importantly, they aren’t cheap either. OpenAI has said it plans to spend $115 billion by 2029, mostly on data centers, to support its AI infrastructure.
And then you have to train the AI models, at an estimated cost of nearly $125 billion by 2028, and again in 2029. By 2030, those training costs will dip below $100 billion (but not by much), according to the Wall Street Journal.
4. OpenAI hasn’t made a profit so far
Despite explosive growth, OpenAI hasn’t made a profit to date.
Reports indicate that the company could generate roughly $30 billion in revenue during 2026, while still posting an estimated $14 billion loss that year. Total losses could reach $44 billion before OpenAI turns a profit in 2029.
Under its current “capped-profit” business structure, OpenAI will have to transition from its opaque, quasi-nonprofit heritage to a fully transparent, publicly traded, for-profit company. Anthropic, with its ChatGPT nemesis Claude — which has also filed for a future IPO — will be a primary and formidable competitor.
5. You can buy the stock before the IPO
As with other pre-IPO offerings, private-market stock previously held by investors, employees, and other insiders is available in the secondary market. For example, ARK funds hold OpenAI in exchange-traded funds, including the ARK Innovation ETF (ARKK) and the Next Generation Internet ETF (ARKW).
Shares may also be available on secondary marketplaces such as Forge. However, you must be an accredited investor to purchase these shares, with a net worth of $1 million or more (excluding your home) and an income of at least $200,000 individually or $300,000 jointly.
6. OpenAI will likely be a part of index funds
If your broker doesn’t offer the OpenAI IPO (and we don’t yet know which brokers those are), you can eventually gain exposure to the stock by purchasing it once it trades publicly — or through an index fund, though which index (S&P 500, Nasdaq) is also not yet known.
Read more: SpaceX: How can I buy the stock?
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