OpenAI reportedly nears $1 billion in annual sales

Fascination with ChatGPT is growing so rapidly that OpenAI, the company behind the generative artificial intelligence technology, is reportedly on track to generate more than $1 billion in revenue.

According to a report from The Information, the milestone could be reached over the next 12 months—much faster than the company’s own revenue projections had forecast. OpenAI declined to comment on the report.

The calculations suggest that OpenAI is currently generating over $80 million per month in revenues, compared to $28 million for all of last year, when it began charging companies to use its chatbot. 

Earlier projections by the company had forecast revenues of $200 million this year, with the $1 billion revenue mark not being touched until 2024.

OpenAI makes money two ways: licensing its technology to corporate clients and via individual subscriptions. The Information reports that as of March, between 1 million and 2 million subscribers were paying the company $20 per month to access the most recent model of the chatbot.

Microsoft, meanwhile, uses OpenAI technology in its Bing search engine; other business clients include Block, Canva, Carlyle, The Estée Lauder Companies, PwC, and Zapier.

The higher-than-expected revenue estimates raise questions about the accuracy of the company’s most recent valuation. In April, OpenAI sold $300 million in shares to Sequoia Capital, Andreessen Horowitz, Founders Fund, Thrive, and K2 Global, which set its valuation within the range of $27 billion to $29 billion. Higher sales could push that well north of the figure.

OpenAI has been on a quest to boost revenues of late, launching an enterprise version of ChatGPT on Monday, offering advanced security and privacy as well as unlimited higher-speed access to GPT-4.

“Since ChatGPT’s launch just nine months ago, we’ve seen teams adopt it in over 80% of Fortune 500 companies,” the company said in a blog post. “We’ve heard from business leaders that they’d like a simple and safe way of deploying it in their organization. Early users of ChatGPT Enterprise . . . are redefining how they operate and are using ChatGPT to craft clearer communications, accelerate coding tasks, rapidly explore answers to complex business questions, assist with creative work, and much more.”

Revenues, of course, don’t equal profits. OpenAI lost a reported $540 million last year developing GPT-4; and last December, OpenAI CEO Sam Altman described the computing costs of running GPT as “eye-watering.”

Even if it does begin to turn a profit, OpenAI won’t be able to fully capitalize on its success for some time. The terms of its deal earlier this year with Microsoft give the company behind Windows the right to 75% of OpenAI’s profits until it earns back the $13 billion it has invested to date.

ChatGPT remains the most visited site providing an AI-powered chatbot by a wide range. Visits to the OpenAI site came in at 1.8 billion in June. The Bing search engine attracted 1.25 billion visits, according to a study by web analytics firm Similar Web. (Google’s Bard chatbot does not yet fall among the top-three visited generative AI sites in Similar Web’s rankings.)

That popularity, despite growing competition, could continue to push OpenAI revenues well ahead of projections for some time to come.