OpenAI, one of the world's fastest-growing AI companies, filed its confidential paperwork for an IPO with the Securities and Exchange Commission (SEC) in June. CEO Sam Altman is reportedly targeting a valuation of at least $1 trillion before it goes public. It was valued at $852 billion after its latest funding round on March 31.
OpenAI hasn't set a firm timeline for its public debut yet, but CFO Sarah Friar recently said in an internal meeting that it would be "a public company in 2027." Let's see how fast OpenAI is growing, what challenges it faces, and what its market debut might look like next year.
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How fast is OpenAI growing?
In late 2024, OpenAI had an annualized revenue run rate (ARR) of $3.7 billion. Its ARR rose to about $20 billion at the end of 2025, $25 billion in early 2026, and over $40 billion in Aug. 2026.
That acceleration was driven by its launches of ChatGPT Plus and ChatGPT Pro, which cost $20 and $200 per month, respectively; its growth among enterprise customers, and the expansion of its developer ecosystem with more application programming interfaces (APIs).
But according to its leaked audited financials, it generated $13.1 billion in booked revenue but posted an operating loss of $20.9 billion in 2025. Those steep losses were driven by the costly expansion of its cloud and AI infrastructure, which will likely accelerate before its IPO.
What challenges does OpenAI face?
At $1 trillion, OpenAI would trade at about 25 times its trailing ARR. That makes it more reasonably valued than SpaceX (SPCX +0.11%), which is currently worth $1.8 trillion and trades at nearly 100 times last year's sales. Its rival Anthropic is reportedly targeting an IPO valuation of $2 trillion, which would be 31 times its $65 billion in ARR at the end of July.
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Key Data Points
By 2029, OpenAI believes it can generate a whopping $100 billion in annual revenue and turn profitable. It expects more than 50% of its revenue to come from ChatGPT, 20% from sales of AI models to developers via APIs, and another 20% from its other products.
OpenAI might seem reasonably valued relative to those long-term forecasts. Still, stiff competition from Anthropic's Claude, Alphabet's (GOOG -0.53%) (GOOGL -0.41%) Google Gemini, SpaceX's Grok, and other generative AI platforms could throttle its growth. There might be enough room for all these platforms to thrive without trampling one another, but ChatGPT's market share (in terms of web traffic and daily active users) has been shrinking.
Investors should closely follow OpenAI's upcoming IPO, but they shouldn't get too excited until they review its S-1 filing. I suspect it will suffer the same fate as SpaceX -- get off to an explosive start but drop back to its IPO price (or lower) as that euphoria fades.
