OpenAI has reduced the target for its latest funding round by $10 billion, seeking $20 billion at a reduced $1.25 trillion valuation down from an earlier $1.4 trillion goal. The recalibration comes amid a steep sell-off in technology stocks, highlighted by a 3.5 percent drop in the Nasdaq 100, and growing market anxiety over massive artificial intelligence expenditures. The firm is also racing against time and investor attention as key rival Anthropic prepares for a mid-November 2026 public listing at a valuation exceeding $1.5 trillion. A UAE consortium led by state-backed fund MGX is expected to lead the round.
Reductions in fundraising goals
- ▪OpenAI's initial funding close for its $1.25 trillion valuation round is expected to generate less than $20 billion after several investors reduced their planned capital allocations
- ▪OpenAI lowered the fundraising target for its latest investment round by $10 billion, shifting its goal from $30 billion to about $20 billion
Valuation target adjustments
- ▪OpenAI adjusted its target valuation for its latest funding round down to $1.25 trillion after previously seeking a $1.4 trillion valuation
- ▪OpenAI previously justified doubling its valuation target from $852 billion to $1.4 trillion based on rapid revenue growth recorded since July 2026
United Arab Emirates investment
- ▪A United Arab Emirates investment consortium including state-backed fund MGX is expected to serve as the largest participant in OpenAI's funding round targeting a $1.25 trillion valuation
- ▪As part of the proposed investment by the UAE-led consortium including MGX, OpenAI will receive an option to lease newly developed computing infrastructure in the United Arab Emirates
Nasdaq stock market drops
- ▪The tech-heavy Nasdaq 100 index fell 3.5 percent on October 30, 2026 amid widespread investor anxiety regarding heavy corporate spending on artificial intelligence
- ▪The Nasdaq index dropped 7.8 percent from its record closing high reached on October 6, 2026
Anthropic initial public offering
- ▪OpenAI rival Anthropic is preparing for a mid-November 2026 initial public offering at an estimated valuation of $1.5 trillion or more
- ▪OpenAI accelerated its fundraising efforts to secure capital prior to Anthropic's public market debut because both companies target similar investor groups
Computing power expenditures
- ▪OpenAI raised $122 billion in March 2026 to fund its computing power expenditures for training and running artificial intelligence models
- ▪OpenAI plans to spend multiples of its March 2026 fundraising total on computing power needed to train and run its artificial intelligence models
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