OpenAI is reportedly preparing for one of the biggest IPOs in history — targeting a $1 trillion valuation — even as it racks up an estimated $11.5 billion loss in a single quarter. Following its restructuring into a public benefit corporation, the ChatGPT creator can now raise capital and operate more like a traditional tech company. Reuters reports that OpenAI’s IPO could double its current valuation, while filings from Microsoft reveal how costly its rapid expansion has become.
In this video, we break down how OpenAI lost billions while still chasing trillion-dollar ambitions, what this means for investors ahead of its IPO, and whether AI hype can justify such a massive valuation. From its partnership with Oracle for $300 billion in compute power to forecasts of $200 billion in annual revenue by 2030, OpenAI’s strategy is both bold and risky. Comment below — would you buy OpenAI stock when it hits the market?
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In this video, we break down how OpenAI lost billions while still chasing trillion-dollar ambitions, what this means for investors ahead of its IPO, and whether AI hype can justify such a massive valuation. From its partnership with Oracle for $300 billion in compute power to forecasts of $200 billion in annual revenue by 2030, OpenAI’s strategy is both bold and risky. Comment below — would you buy OpenAI stock when it hits the market?
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#OpenAI #ChatGPT #IPO #AI #TechNews #Microsoft #ArtificialIntelligence #Investing #Finance #AIStocks #Innovation #OpenAIIPO #ChatGPTNews #Startup #stockmarketeducation
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00:00Welcome back to the Deep Dive. Okay, so today our mission, we're diving into a whole stack of
00:05sources. We've got SEC filings, some pretty deep financial analysis, market commentary,
00:09and we're really trying to cut through the noise surrounding, well, a valuation that's just so
00:14staggering it almost bends the rules of economics. We are talking about the rumored OpenAI IPO,
00:20and that colossal number, one trillion dollars. So this Deep Dive, it's really about testing a
00:26fundamental question, isn't it? When a company is aiming for that kind of valuation, a trillion
00:30dollars with basically zero history of profit, is this just, you know, the necessary cost for the
00:35next huge tech leap, or is it maybe the biggest speculative bubble we've seen in years?
00:40And that's exactly why this story, well, it reaches far beyond Silicon Valley. It's not just
00:45tech circles watching this. This valuation isn't just about OpenAI's financial future. It's really
00:51a stress test for the whole AI ecosystem. And maybe more importantly, it forces us, like right now,
00:57to reassess valuations across the board. And the fundamental relationship between this kind of
01:04centralized AI power and the whole decentralized world of Web3 and crypto, the capital implications
01:09there for things like decentralized compute, tokenized data, they're enormous.
01:14Okay, right. So let's start with just the sheer, well, the audacity of it all,
01:18the ambition, the breaking story seems to confirm OpenAI just finished this massive internal
01:23restructuring of its for-profit arm specifically, that we're basically clearing the decks legally
01:27and financially to go public. And yet, when we say go public, we're not talking about some quiet
01:32little debut. Sources are suggesting they're targeting an IPO valuation that could actually
01:36hit $1 trillion.
01:36Which is double its current private value.
01:39Yeah, exactly. Double. To put that scale into context for you, that would vault them past Meta,
01:44past Alibaba, making it one of the biggest IPOs in history, almost overnight.
01:49Yeah. And what's immediately fascinating, I think, is the structural tightrope they're trying to walk
01:54to get there. They converted their operational arm, the one that's really aggressive and needs capital,
01:59into a public benefit corporation, a PBC. Now, that status, it gives them the full freedom
02:05to raise capital, just like any traditional, you know, profit-hungry company, which is what
02:09Wall Street wants to see. But they're still legally tied to the non-profit foundation that
02:14started it all. Meaning, theoretically, they're bound by this mission focused on safety, alignment,
02:19you know, the long-term benefit of humanity. So that creates this immediate and, I think,
02:22genuine structural conflict.
02:24Right. How do you, as a publicly traded PDC, balance that fiduciary duty to maximize shareholder
02:29profit every single quarter? With a moral and maybe legal mandate to sometimes, I don't know,
02:34slow down. Prioritize safety over quick cash. And given the track record of other tech companies
02:40trying that, you know, balancing mission and profit, thinking back to Google's Don't Be Evil
02:44and, well, countless others that kind of stumbled, why do analysts think OpenAI can actually pull off
02:50this structural tightrope walk?
02:53Well, cynically, perhaps, because the mission statement often ends up being more about PR than
02:57actual legal teeth when push comes to shove.
02:59Yeah.
03:00You know, the PBC status looks good on paper, on the prospectus, but Wall Street is betting
03:04that when the really tough decisions come, let's say a choice between a $10 billion profit
03:09opportunity and a safety measure that costs $5 billion and delays everything, they're betting
03:13the capital imperative wins out.
03:14Right.
03:15Every time. That $1 trillion valuation, it's built on the assumption of aggressive monetization,
03:20not ethical deliberation.
03:22Okay. So that's structural tension. It only gets sharper when we actually lift the hood and
03:26look at the financials, right? The engine powering this thing. Because despite all the $1 trillion
03:30hype, the reality check from the sources is, well, it's pretty brutal. The company's absolutely
03:35bleeding cash. We're talking massive operational losses. Revealed through SEC filings via Microsoft,
03:41who you got to remember is their biggest partner, owns 27%.
03:44The huge chunk.
03:45Yeah. And the company reportedly posted an $11.5 billion net loss just in Q3 2025 alone. Just to
03:53put that $11.5 billion in perspective for you, that's roughly $125 million lost every single day
03:59for three months. It's truly staggering.
04:02And that immediately raises the question, okay, what exactly is $11.5 billion paying for? Because
04:08it's definitely not paying for profit margins. It's paying for the infrastructure arms race.
04:11And the talent war. Simple as that. This money is just being poured into like two main buckets,
04:17securing massive multi-year contracts for GPU capacity, basically pre-buying the future of
04:23compute power and holding on to the absolute best AI minds in the world through these intense bidding
04:28wars for talent. And if you look at the slightly bigger picture, their first half loss was $13.5
04:33billion, while revenue in that same period was only $4.3 billion. Yeah. So even if you accept the,
04:41frankly, very optimistic projection of $20 billion revenue for the full year, that $11.5 billion
04:46loss in just one quarter, it's wildly unsustainable. Unless, unless you have this absolutely watertight
04:51story that guarantees exponential, just unstoppable future dominance. This is the definition of betting
04:57the entire company on tomorrow.
04:58So how on earth do you justify gunning for a $1 billion valuation when your books are just
05:02awash in red ink like that?
05:04Ah, you justify it with a growth narrative.
05:06Right.
05:06It's all about monetizing potential that isn't real yet. Unrealized potential. The core idea,
05:12the thesis is that this insane burn rate is actually a necessary investment. It's to build
05:17the moat, to become the kind of mandatory operating system for AI agents everywhere, globally. They're
05:24forecasting explosive growth, not just from, you know, current ChatGPT subscriptions, but from huge
05:30multi-year API deals with big companies, enterprise contracts, and eventually the rollout of these
05:36full AI agent ecosystems that could run everything from like your calendar to a global supply chain.
05:43And the numbers they're throwing around for that growth are, well, they're audacious too. They're
05:46forecasting heading $200 billion in annual revenue by 2030.
05:50$200 billion.
05:51Yeah. That's a 10x jump in revenue in just five years, that forecast. That's the bedrock. That's
05:55what the $1 trillion valuation stands on. And the market, or at least parts of it,
06:00seem willing to believe it. Why? Because of the user base. Look at the metrics they have right
06:04now. 800 million weekly active users currently. That's incredible engagement.
06:09It's unparalleled global engagement. Absolutely. But here's the catch. The monetization gap.
06:15Only our 20 million of those 800 million actually pay for premium tiers right now.
06:20A tiny fraction.
06:20Tiny. So the IPO excitement, it's driven by pure potential. If they manage to convert just say
06:255%, maybe 10% of those 800 million free users into paying subscribers, which, you know,
06:31the company believes they can do once these tools become truly indispensable, then that revenue curve
06:36just shifts exponentially upwards. Suddenly $200 billion looks almost conservative. So the IPO is
06:43simply designed to get the cash now. The liquidity needed to lock in that market dominance before
06:47rivals Google meta-anthropic can catch up. Okay, but here's where the cost of achieving
06:53that dominance becomes, well, unavoidable. The infrastructure arms race. You just can't
06:58get to that kind of scale. Lock in $200 billion in revenue without spending absolutely astronomical
07:03sums on compute power. Data centers, specialized GPUs, and the prime example is that specific deal
07:08they signed. A staggering $300 billion five-year compute partnership with Oracle.
07:13$300 billion. Just for compute.
07:16Right. To put that number in perspective for you, it's larger than the entire GDP of several
07:21medium-sized countries. It really forces you to rethink what the word scale even means in this
07:26industry.
07:27And we really need to connect this back to the kind of spending cycles we've seen before,
07:31particularly in the digital asset space. In crypto, the sources we looked at described this
07:37spending is chasing energy-grade scale. It really mirrors the immense capital intensity of those
07:42early crypto cycles. Remember that?
07:44Yeah, I do.
07:45Think about like the Bitcoin miners building out those huge hash power networks back in the
07:49expansion phases. Or how layer one blockchain spent massively on infrastructure grants, security,
07:55all to secure future network use. OpenAI is basically doing the same kind of giant anticipatory
08:01bet. They're spending unbelievable money now at a record pace, hoping to secure that future
08:05market dominance later.
08:07That comparison to Bitcoin mining is interesting. It's compelling because both are super capital
08:11intensive. Yeah. But is it really an apples to apples comparison for investors? Bitcoin's
08:16utility, its value is secured by math, right? Like cryptography. Verifiable hash power. This
08:22AI dominance, it seems to rely more on proprietary data, holding onto talent, keeping a software lead.
08:27Is that difference in risk like hard infrastructure versus maybe softer intellectual property being properly
08:33factored into that trillion dollar valuation? That's a really critical distinction. Yeah.
08:37In crypto, your capital spending directly secures the network itself. Hash rate, TVL, whatever. It's more
08:43direct. In AI, the spending secures the potential for future market share. So the risk profile is
08:49definitely higher because the moat relies on these, as you said, softer factors, talent, proprietary data,
08:55things that can be challenged, maybe poached. That $300 billion deal with Oracle, it isn't just buying
09:01hardware. It's like a non-refundable ticket to enter this incredibly expensive race where maybe
09:06the runner up gets almost nothing. The sheer scale of the spending, though, it signals to the market,
09:11and maybe more importantly to their competitors, that they are absolutely playing a winner-take-all
09:16game here. And this level of spending, this valuation, it leads us straight into market psychology,
09:21doesn't it? Yeah. Investors generally seem to see OpenAI as the undisputed flagship for the whole
09:25AI revolution, kind of like how Bitcoin served as the main flagship for the blockchain space for a long time.
09:31The bellwether, yeah. But as we know from crypto and elsewhere, flagship assets attract immense
09:35excitement. And sometimes, well, they fly a bit too close to the sun. And our sources actually
09:40highlighted a very recent warning sign from another tech giant. It shows just how volatile the market's
09:46tolerance for this kind of AI spending really is. Meta recently announced they'd be spending $72
09:51billion on AI this year alone, $72 billion. And their stock promptly plunged 11% the next day,
09:57wiped out $200 billion in value overnight. Ouch.
10:01Yeah. That was an instant market reaction driven purely by the fear of just massive
10:04non-revenue generating spending in AI. And this is precisely why the success or failure
10:10of this open AI IPO is going to have these profound ripple effects, contagion effects.
10:15Across that whole AI crypto convergence space we mentioned earlier, we're talking decentralized
10:20compute networks, tokenized data markets, AI agent ecosystems being built on Web3 infrastructure.
10:25Look, if the IPO succeeds, if they actually raise the capital at or near that $1 trillion valuation,
10:32it acts as this massive legitimizing force. It basically confirms AI as an unstoppable
10:36multi-trillion dollar mega trend in the eyes of big capital. And money will flood out of traditional
10:41tech right into those blockchain AI hybrids. Projects like, say, Fetch.ai doing decentralized
10:46agents, render focusing on decentralized GPUs, singularity net. It gives that whole decentralized
10:51AI sector a huge credibility boost and a capital boost. However, if the IPO underperforms, if the
10:56market looks at that $11.5 billion quarterly loss and just says, nope, $1 trillion is too much
11:01hype. Which is definitely possible. Absolutely possible. Then it could trigger an immediate
11:05sector-wide AI valuation correction. And that correction will absolutely spill over into the
11:10crypto narratives tied to decentralized compute, AI tokens, all of it. This IPO really will be
11:17the ultimate bellwether, telling us where the market thinks the heavy spending stops and the
11:22actual profit needs to start. Wow. Okay. This deep dive into the numbers, the structure,
11:28the market psychology, it's been incredibly illuminating. And hey, before we wrap up,
11:32if you're finding this kind of breakdown valuable and you want to keep getting these deep dives on the
11:36biggest shifts in tech and crypto, the stuff that really shows you where capital is flowing, well,
11:40subscribing, commenting, engaging with our content, it really does help support the channel a lot.
11:46It boosts our visibility and the algorithms lets us keep making this kind of content for you. So,
11:50thanks for considering that. Yeah, definitely. And ultimately, the core tension here,
11:55it remains exactly where we started, doesn't it? This IPO is going to test whether global markets,
12:00maybe for the first time in a decade, truly value alignment and safety, you know, the public benefit
12:05core mission, or whether at the end of the day, they just want short term growth and hype.
12:10Regardless of the ethical questions, or frankly, the financial burn rate, it's really a test.
12:15Is the future of tech going to be driven by capital first or by mission first?
12:19So here's the final thought for you to reflect on. Consider that incredible contradiction we just
12:23laid out, an $11.5 billion net loss in a single quarter. Yet the push is for a $1 trillion valuation
12:30based on hitting $200 billion in revenue five years from now. Can AI profits ever truly catch up to the
12:37sheer scale of the AI hype? That's the billion-dollar question. Or perhaps, yeah, the trillion-dollar
12:42question you need to keep mulling over as you watch this absolutely monumental story unfold.
12:46Thanks for joining us for the Deep Dive. We'll catch you next time.
12:49I'll see you next time.
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