OpenAI Files for IPO With $852 Billion Valuation

OpenAI is now worth $852 billion. That is the number that matters. It’s not the confidential filing. It’s not the SEC paperwork. It’s the sheer scale of the bet that artificial intelligence is a commodity worth trading on the open market.

The San Francisco-based giant has filed preliminary paperwork with the U.S. Securities and Exchange Commission. This moves OpenAI into the final stretch of becoming a publicly traded company. It is the third major AI player to make this move, following Anthropic and Elon Musk’s SpaceX. But the valuation is what sets it apart. At that price tag, OpenAI would rank among the 15 largest companies in the S&P 500.

Let’s do the math on what that actually means for the structure of the company. OpenAI started in 2015 as a nonprofit dedicated to developing AI for the common good. It is now a for-profit entity valued at nearly a trillion dollars. The transition wasn’t easy. Last year, the company reorganized its business structure, converting into a public benefit corporation while remaining technically under the control of a nonprofit. That legal maneuvering was necessary to clear the path for an IPO. It also helped that OpenAI won its federal jury trial against Elon Musk last month. Musk, a co-founder and early donor, sued to oust CEO Sam Altman and unravel the conversion to a for-profit business. The judge dismissed the case after finding Musk filed too late. The legal dust has settled. Now comes the financial reckoning.

The timing is strategic, even if the company claims it’s just "preparing." OpenAI CEO Sam Altman first floated the idea of an IPO last fall, calling it the “most likely path” given the company’s size and the need for vast amounts of capital. Capital for what? Compute. That is the new oil, and it is expensive. Sarah Friar, the chief financial officer, told the Associated Press that the company is already “acting with the good hygiene of a public company.” They are measuring revenue the way a publicly traded firm would report earnings. They are getting ready.

But here is the catch that the press releases don’t always highlight: OpenAI is losing money. It has been losing more than it makes. The costs of building AI infrastructure are astronomical. Anthropic, its fiercest competitor, is in the same boat. SpaceX is too. They are burning cash to build a competitive advantage in compute. If you believe compute is the key to winning the AI race, then going public makes sense. The public markets are bigger than the private markets. You can raise more money faster. You can tap into investor pools that private equity can’t touch.

“We expect it to leak so we’re just announcing it,” OpenAI said in a statement. They haven’t decided on timing yet. It might be a while. There are things that are easier to do as a private company. But the option is there. It’s a complicated set of tradeoffs.

For the average person watching the tech world, this isn’t just about stock tickers. It’s about who controls the technology that is rapidly integrating into our daily lives. When a company this size goes public, it answers to shareholders. Shareholders want returns. They want growth. They want the AI to make money, not just be "for the common good" in the abstract sense of the old nonprofit days. The "credentializing moment of being a public company," as Friar called it, changes the incentive structure. It forces efficiency. It forces transparency.

The filing itself is confidential, which means we don’t know the exact number of shares or the initial price yet. But the direction is clear. OpenAI is no longer a quirky nonprofit experiment. It is a financial behemoth preparing to join the big leagues. The competition is fierce. Anthropic is watching. Musk is watching. The market is watching. And when the IPO finally happens, the valuation of $852 billion will be put to the test. If the compute costs keep rising and the revenue doesn’t follow, that valuation could look very expensive very quickly. If the AI boom continues, it might be cheap. We don’t know yet. But the door is open. The paperwork is filed. The clock is ticking.