On February 27, OpenAI announced the completion of a new round of financing of approximately $110 billion, with a pre-investment valuation of $730 billion.
This marks another record fundraising for OpenAI following last year's $41 billion financing, and it is the largest financing for a private technology company to date.
This round of financing is led by strategic investors, with Amazon investing $50 billion, and SoftBank and NVIDIA each contributing $30 billion.
<img src="https://imageproxy.pbkrs.com/https://wpimg-wscn.awtmt.com/a6ec830a-95b1-4270-9645-e0bf1ae5503c.png?x-oss-process=image/auto-orient,1/interlace,1/resize,w_1440,h_1440/quality,q_95/format,jpg" alt="Image" original-src="https://imageproxy.pbkrs.com/https://wpimg-wscn.awtmt.com/a6ec830a-95b1-4270-9645-e0bf1ae5503c.png"/>
After this round of financing, OpenAI's cash on hand increased to approximately $150 billion. OpenAI stated that the funds will primarily be used to expand computing infrastructure to meet rapidly growing user demand.
<h2>01 Amazon's $50 Billion Investment in Installments</h2>
As the most generous investor in this round of financing, Amazon's promised $50 billion investment will be executed in two phases: the first phase of $15 billion has been confirmed, while the remaining $35 billion will be provided once OpenAI completes its IPO or achieves AGI.
Therefore, Ultraman quickly expressed an open attitude towards going public at the right time.
Regarding AGI, according to the previous contract between OpenAI and Microsoft, AGI is defined as &#34;a highly autonomous system that can outperform humans in the most economically valuable work.&#34; OpenAI's charter includes a special clause: once AGI is achieved, Microsoft will lose access to its technology.
However, Amazon is not just providing funds; the two parties have also signed a comprehensive technical cooperation agreement—Amazon will exchange its chips and cloud services for OpenAI's models and technology.
The core terms of the cooperation between the two parties involve computing power procurement.
OpenAI will pay AWS $100 billion for computing power over the next eight years, in addition to the existing $38 billion contract. A significant portion of this $100 billion will be used for Amazon's self-developed Trainium chips. OpenAI has committed to procuring approximately 2 gigawatts of Trainium computing power, including the soon-to-be-delivered Trainium3 and the Trainium4 set to launch in 2027.
Amazon CEO Andy Jassy specifically mentioned that the cost-performance ratio of Trainium chips is 30% to 40% higher than comparable GPUs, &#34;and now both leading AI labs are using them.&#34;
The other lab is Anthropic, which has recently been making waves with the U.S. government.
Another collaboration between OpenAI and Amazon at the product level will involve jointly developing a &#34;Stateful Runtime Environment,&#34; which will run on Amazon Bedrock. This environment will allow developers to maintain context, remember previous work, and collaborate across tools when calling OpenAI models
AWS has also secured exclusive third-party distribution rights for OpenAI's enterprise platform Frontier.
There is a more direct layer of cooperation: Amazon will use OpenAI's models to optimize its own consumer applications. The two companies will jointly develop customized models for use by Amazon's internal teams, covering product lines from e-commerce to smart hardware.
<h2>02 NVIDIA $30 Billion: Shareholders + Suppliers</h2>
The collaboration between NVIDIA and OpenAI was once rumored to have fallen through, especially with Jensen Huang's statement: investing $100 billion in OpenAI was never a commitment.
However, in any case, the final investment has been settled, although it is significantly lower than the rumored $100 billion, amounting to only $30 billion paid in three installments.
According to the announcement, the two parties have finalized a new computing power collaboration: NVIDIA will provide OpenAI with 3 gigawatts of dedicated inference computing power, as well as 2 gigawatts for training computing power for the Vera Rubin system—built on top of the Hopper and Blackwell systems already running on Microsoft, Oracle Cloud, and CoreWeave.
From a computing power perspective, 1 GW corresponds to $50 billion, and NVIDIA's support for OpenAI is definitely worth far more than the rumored $100 billion.
From this perspective, NVIDIA is both a shareholder of OpenAI and its largest chip supplier, while also using &#34;its own money&#34; to help OpenAI buy its own chips. In the $30 billion financing, most of it will ultimately return to NVIDIA's accounts in the form of purchased computing power.
To summarize in one sentence, it remains the previous narrative of &#34;circular financing.&#34;
<h2>03 SoftBank $30 Billion: IPO is More Important than Anything</h2>
Like NVIDIA, SoftBank's $30 billion investment commitment will also be paid in three installments.
Masayoshi Son's thinking is relatively straightforward: OpenAI is currently the most likely candidate for an IPO in the AI sector, and SoftBank needs an IPO to boost the performance of its Vision Fund.
Insiders say this round of financing is seen as an important step before OpenAI's IPO, which could start as early as the end of this year.
Compared to the other two investors, SoftBank's other role is that of a connector.
According to insiders, OpenAI is expected to receive about $10 billion in primary equity financing, with related commitments to be finalized within the next month, including sovereign wealth funds and investment companies. It is speculated that these investors may have come in through SoftBank's connections.
<h2>04 Microsoft: No Money This Round, But Status Remains Unchanged</h2>
In the face of Amazon's entry, Microsoft and OpenAI issued a joint statement today, emphasizing that their cooperative relationship has not been affected.
The statement said, Microsoft remains the exclusive cloud provider for OpenAI's stateless API, and all API calls to OpenAI's models, as long as they are stateless (not retaining context), are hosted on Azure. This is currently the most mainstream way to call OpenAI's models
At the same time, OpenAI's own products (including the newly launched Frontier) will continue to be hosted on Azure. Frontier is the enterprise platform just introduced by OpenAI, allowing businesses to deploy AI agents themselves.
The intellectual property licensing and revenue-sharing arrangements between Microsoft and OpenAI remain unchanged. However, OpenAI has the right to procure computing power from elsewhere, including large-scale infrastructure projects like &#34;Stargate.&#34;
<h2>05 The Copy-Paste Narrative of &#34;Revolving Financing&#34;</h2>
Looking at the investments and returns from these four companies together, as mentioned earlier, it still reflects the narrative of &#34;revolving financing&#34;:
<ul>
<li>
Amazon invests $50 billion in exchange for OpenAI's model technology licensing and $100 billion in cloud service orders.
</li>
<li>
NVIDIA invests $30 billion in exchange for OpenAI's chip procurement commitments.
</li>
<li>
SoftBank invests $30 billion, betting on IPO exit opportunities.
</li>
<li>
Microsoft did not invest in this round but retains exclusive rights to the API, meaning that for every API call OpenAI sells in the future, Microsoft will receive a share.
</li>
</ul>
After this round of financing, OpenAI has an additional $110 billion on its books, while also holding the computing resources of three tech giants. The cost is that future technology licensing and cloud service procurement have been locked in early for shareholders.
Moreover, both Amazon and SoftBank have made OpenAI's IPO a key condition for realizing their investment commitments.
Thus, OpenAI's shareholder list now includes Microsoft, Amazon, NVIDIA, and SoftBank, four giants with overlapping yet conflicting business interests. Balancing the interests of these shareholders will be a challenge that Sam Altman will face moving forward.
<h2>06 ChatGPT Weekly Active Users Exceed 900 Million</h2>
Returning to the business aspect, OpenAI indeed needs this funding.
OpenAI originally had about $40 billion in cash, and with this round of financing, available funds will increase to about $150 billion. The company expects to achieve positive free cash flow for the first time by 2030. Before that, most of the funds will be invested in data center operations, chip procurement, and cloud service expenditures.
Financial data reported by the Financial Times from informed sources illustrates the situation well: Revenue is expected to be about $13 billion in 2025, with projections reaching $30 billion this year, targeting over $60 billion by 2027 and over $280 billion by 2030. The growth curve is steep, but the cost growth is even faster.
In terms of user data: According to OpenAI's official announcement, ChatGPT currently has over 900 million weekly active users, with consumer subscription users exceeding 50 million and paid commercial users exceeding 9 million. The programming tool Codex launched this year has seen its weekly active users double since the beginning of the year, reaching 1.6 million.
The data growth performance is impressive, but competitors are also not idle.
Google's Gemini is closing in on the consumer market, while Anthropic has already taken the lead in the enterprise market. OpenAI executives stated that by the end of this year, half of the revenue should come from enterprise clients, while the current proportion is 40%. This means that in the coming quarters, OpenAI must confront Anthropic head-on to capture 10% of the incremental growth
There is another detail worth noting, the change in equity structure.
After this round of financing, the for-profit business shares held by the non-profit organization &#34;OpenAI Foundation,&#34; which will be spun off from OpenAI in 2025, have risen in value to over $180 billion. According to informed sources, if investor demand is strong, the foundation may sell up to $10 billion in stock for charitable expenditures and personnel recruitment.
In other words, after this $110 billion financing round, there may still be a wave of OpenAI stocks available for purchase in the private secondary market.
Source: Tencent Technology

AMZN

9984

OpenAI

Amazon invests $50 billion for the licensing of OpenAI's model technology and a $100 billion cloud services order. NVIDIA invests $30 billion for a commitment to purchase 3 gigawatts of computing power from OpenAI. SoftBank invests $30 billion, betting on OpenAI's IPO. Microsoft did not spend money this round but retained exclusive rights to the API

- On February 27, OpenAI announced a record $110 billion funding round, valuing the company at $730 billion pre-investment.  
- The funding was led by major investors including Amazon, which committed $50 billion, alongside SoftBank and Nvidia, each investing $30 billion.  
- The capital will primarily enhance computing infrastructure to meet soaring user demand, with OpenAI expecting significant cash flow growth in the coming years, despite rising competition in the AI sector.

Wallstreetcn

Amazon

SoftBank Group Corp.

Microsoft

SoftBank

NVIDIA

Direxion Daily MSFT Bull 2X Shares

GraniteShares 2x Long MSFT Daily ETF

Direxion Daily NVDA Bull 2X Shares

T-Rex 2X Long Microsoft Daily Target ETF

T-Rex 2X Long NVIDIA Daily Target ETF

YieldMax MSFT Option Income Strategy ETF

Global X Cloud Computing ETF

Roundhill AMZN WeeklyPay ETF

iShares Expanded Tech Software Sector ETF

Direxion Daily AMZN Bull 2X Shares

GraniteShares 2x Long AMZN Daily ETF

YieldMax NVDA Option Income Strategy ETF

GraniteShares 2x Long NVDA Daily ETF

Spdr Select Tech

XL2CSOPNVDA

XI2CSOPNVDA

Direxion Daily NVDA Bear 1X ETF

T-Rex 2X Inverse NVIDIA Daily Target ETF

Direxion Semicon Bull 3X

Amazon, NVIDIA, and SoftBank invest $110 billion in OpenAI. What are the benefits?