Microsoft, Apple, and NVIDIA will reportedly bail out OpenAI from the shackles of bankruptcy, pushing the ChatGPT maker’s market valuation to over $100 billion
OpenAI gets an extended lifeline through another round of funding.
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What you need to know
Last month, reports emerged indicating thatOpenAI is running on fumes and could be on the brink of bankruptcy within 12 months, with projections of $5 billion in losses. Despite the discounted access to Microsoft’s Azure services and approximately $3.5 billion generated in revenue, the ChatGPT maker might need another round of funding to remain afloat.
And now, according to a report byCNBC, OpenAI is in talks to raise funding which could push its market valuation to over $100 billion. The company’s valuation has significantly grown over the past years — from $29 billion in 2023 to $80 billion earlier this year.
The company’s success can be attributed tothe launch of ChatGPTand itsbroad adoption(arguably the most popular AI-powered chatbot) coupled with the subsequent release of sophisticated and advanced AI models with image and video generation capabilities likeDALL-E 3andSora.
Interestingly, Microsoft, OpenAI’s largest investor, will reportedly be participating in the round of funding, according to a report by the Wall Street Journal. However, it’s unclear how much the Redmond giant will invest. Microsoft and OpenAI’s partnership continues to become more complicated, especially afterthe latter officially listed the ChatGPT maker as a competitor in AI and searchdespite its multi-billion investment in the business.
Apple and NVIDIA might be joining OpenAI’s round of funding, too
In anexclusive report by The Wall Street Journal, Apple and NVIDIA could potentially join OpenAI’s round of funding, pushing its market capitalization well above $100 billion.
This isn’t surprising, as both tech corporations have deep ties with the ChatGPT maker. Apple, often referred to as a late bloomer in the AI landscape, is leveraging OpenAI’s technology to power itsApple Intelligence serviceacross its tech stack.
OpenAI and Microsoft rely on NVIDIA for GPUs to facilitate their advances in the AI landscape. Both companies reportedlyinvested $100 billion in a project dubbed Stargateto free themselves from the shackles and overreliance onthe world’s most profitable semiconductor chip brandfor AI chips.
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More companies are hopping onto the AI bandwagon, pushing the demand for AI chips to an all-time high. Consequently,NVIDIA struggles to meet the high demands, prompting a need for an alternative source.
Microsoft,NVIDIA, andApplehave been neck-and-neck in the AI arms race, with each company briefly getting a taste of the world’s most valuable company crown. All these companies are involved in OpenAI’s business and reliant on its services, which could explain their involvement in the funding exercise. With OpenAI’s fast-rising market valuation, it could potentially contend for the world’s most valuable company crown against its partners in the foreseeable future.
It’s unclear how much NVIDIA and Apple plan to invest in OpenAI’s round of funding. This is a developing story, we’ll keep you posted as more details about the deal become available.
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Kevin Okemwa is a seasoned tech journalist based in Nairobi, Kenya with lots of experience covering the latest trends and developments in the industry at Windows Central. With a passion for innovation and a keen eye for detail, he has written for leading publications such as OnMSFT, MakeUseOf, and Windows Report, providing insightful analysis and breaking news on everything revolving around the Microsoft ecosystem. You’ll also catch him occasionally contributing at iMore about Apple and AI. While AFK and not busy following the ever-emerging trends in tech, you can find him exploring the world or listening to music.
