OpenAI Takes First Step Toward IPO With Confidential S-1 Filing as It Loses Ground to Google and Anthropic
OpenAI took its first formal step toward a public listing on Monday. Three major AI companies are now moving toward IPOs in the same year.
OpenAI filed a confidential S-1 registration statement on Monday, marking the first official step toward an eventual public listing. The filing follows a similar move by Anthropic and places OpenAI alongside SpaceX, which includes Elon Musk's xAI, in the IPO queue. SpaceX is scheduled to go public later this week.
OpenAI stated that it may be a while before shares are actually listed for public trading. Perplexity CEO Aravind Srinivas said his company still plans an IPO in 2028 regardless of the timing chosen by OpenAI, Anthropic, and SpaceX. Srinivas added that the outcomes of those three IPOs will carry ripple effects for the broader industry if they do not go well.
Wedbush analyst Dan Ives wrote that OpenAI's filing shows the floodgates for the IPO market are officially open. Ives noted that both OpenAI and Anthropic have raised significant capital recently and are racing each other to market because of the large amounts each firm seeks to raise.
Ives also said OpenAI CEO Sam Altman faces competitive pressure from Anthropic to demonstrate that growth will continue at its current pace through the next decade.
Niles Investment Management founder Dan Niles told CNBC he views Anthropic more favorably than OpenAI. Niles said Google wins in consumer AI and holds the complete stack, while Anthropic wins in corporate AI. He added that Anthropic reached profitability in Q2 and that its revenues are ramping faster than any company of its size in history.
Niles said OpenAI is stuck between Google and Anthropic. Verdict Capital founder Michael Fertik said he hopes SpaceX's Friday IPO opens the door to a gushing torrent of liquidity. Fertik said strong debuts by these companies would help the United States stay ahead in the generative AI race and allow retail investors to participate after years of reliance on private markets.
Decision Tree Research founder Gregory Allen said the valuations of OpenAI, SpaceX, and Anthropic sit in the ballpark of a trillion dollars. Allen described such a valuation as akin to an annuity that generates $45 billion a year in perpetuity. He noted that companies like OpenAI will lose money this year but that gross margins in these businesses remain extremely favorable.
EMARKETER principal analyst Nate Elliott said OpenAI is filing at a precarious moment because it is about to lose its early leads in both consumer and enterprise AI. S. AI users by early 2027.
Elliott added that OpenAI has taken almost $200 billion in funding across more than a dozen private rounds and cannot count on its consumer business becoming self-sufficient anytime soon. OpenAI chief futurist Joshua Achiam posted on X that the choice between the two companies is between entrusting humanity with the tools of its own progress and destiny or placing oversight with a loving ensouled machine God.
Achiam dismissed consumer-versus-enterprise framing as unfixably borked.
AI researcher Gary Marcus wrote on X that the only people buying SpaceX and OpenAI at list price will be stragglers who still cannot see the current state of the industry.