Rachel Warren

This funding round values OpenAI at around $852 billion.

You put that in perspective, that's more than the market cap of most blue-chip companies on the S&P 500.

OpenAI hasn't even hit the public markets yet, obviously.

We have seen, of course, in the past, a bit of a gap between the private market valuation and what a company looks like once they hit the public markets.

As Lou mentioned, they're bringing in about $2 billion a month in revenue, but they're looking at a

projected $14 billion loss in 2026.

They've already said they're planning to burn through about $115 billion in cash over the next two years, you know, due to their investments in data centers and artificial general intelligence.

So, you know, then you're thinking, okay, so how does an IPO make sense for investors?

If you're an institutional investor, right, you're betting on the foundational layer of the entire AI economy.

We've seen, you know, institutional investors essentially salivating to own a piece of the business.

I

I'm curious about whether that appeal, how that's going to translate to a public listing.

When you're looking at a valuation of this magnitude, a significant chunk of at least near-term future success is already priced in.

For the stock to really pop post-IPO, OpenAI doesn't just have to succeed, it has to become one of the most valuable companies in history.

What would be really interesting is when we see that S-1 filing, right, really pulling back the curtain on their exact margin structures, their compute costs.

I think if those disclosures show diminishing returns or even that open source rivals are eating some of their pricing power, that kind of growth at all costs narrative could sour quickly.

So those are some things I'm thinking about right now.

Yeah, I think the market is somewhat losing patience with the grueling multi-year restoration of the business that CEO Elliot Hill is still spearheading.

So this was their Q3 report.

Revenue was a little over $11 billion, earnings per share $0.35.