OpenAI Cuts Funding Round Target to $20 Billion as Tech Stocks Slide

OpenAI has cut the target for its newest funding round by $10 billion, to about $20 billion, and lowered the valuation it is seeking to $1.25 trillion, the Financial Times reported on Friday, Oct. 30, 2026, citing people with knowledge of the matter. The OpenAI funding round had been pitched at up to $30 billion only a week earlier, and the reduction lands in the middle of a sharp selloff in technology stocks tied to worries about AI spending, CNBC reported, relaying the FT story via Reuters.

Key figures: ~$20B new target (was up to $30B) · $1.25T valuation goal (was $1.4T) · $852B last post-money mark · Nasdaq -7.8% from Oct. 6 high

What changed in the OpenAI raise

According to the FT account, OpenAI gave investors a Friday deadline to commit money. Some backers then trimmed how much they would put in, so the first close of the round is now on track to bring in less than $20 billion. A group of investors from the United Arab Emirates that includes MGX, a state-backed technology fund, is set to be the largest participant. As part of that arrangement, OpenAI would get an option to lease newly built computing capacity in the region.

Venture firms Founders Fund, Coatue, Sequoia Capital and Andreessen Horowitz are also lined up to take part, the newspaper reported. Wealthy individuals would get a chance to buy in later through a separate offering for private investors at the same $1.25 trillion price. OpenAI, MGX, Coatue, Sequoia and Andreessen Horowitz did not immediately answer requests for comment from Reuters, and Founders Fund could not be reached.

The plan looked bigger on Oct. 22, when CNBC first reported that OpenAI was close to finalizing a round of up to $30 billion at a $1.25 trillion pre-money valuation, a figure that excludes the new cash. UAE investors and Coatue were leading that deal, which the people involved described as an “opportunistic” bridge ahead of a possible initial public offering. A month before that, Bloomberg had reported talks at a $1.4 trillion valuation, TechCrunch noted.

By the numbers: a smaller check, a lower price

Measured against the original ceiling, the new target is one-third smaller: $10 billion less on a $30 billion plan, by TBR’s calculation from the reported figures. The valuation goal fell by $150 billion, or about 10.7%, from the $1.4 trillion discussed in September.

Even so, the reduced price would still be a big step up. OpenAI’s last priced round, in March 2026, valued it at $852 billion after the new money came in. A $1.25 trillion pre-money mark is about $398 billion, or roughly 47%, higher than that, according to TBR’s math. The two numbers are not a perfect match, because one counts the fresh cash and the other does not, so the true gap is somewhat wider.

The longer arc is steeper still. OpenAI said it raised $6.6 billion at a $157 billion post-money valuation in October 2024, then $40 billion at $300 billion in March 2025, led by SoftBank. An employee share sale in October 2025 put the company at $500 billion, Reuters reported. The new target is close to eight times the October 2024 figure.

Markets and the race with Anthropic

The timing is awkward for any company asking for a record private price. The Nasdaq Composite fell 2.9% on Friday and closed 7.8% below its all-time closing high from Oct. 6, according to the Reuters report. This week, Alphabet shares were headed for their worst day since the company’s 2004 IPO after AI spending pushed its free cash flow negative, and Intel stock was on track for its worst day since 1974 on a soft forecast.

Rival Anthropic adds another source of pressure. Reuters has reported that OpenAI wanted to finish this round partly to get ahead of Anthropic’s listing, because both companies are pitching a similar pool of investors. Anthropic raised $65 billion at a $965 billion valuation in May, and CNBC has reported it is seeking $1.5 trillion to $2 trillion in its stock market debut. Its public IPO paperwork, covered in The Boston Report’s look at the Anthropic S-1 filing, landed on Oct. 28.

What comes next for OpenAI

OpenAI filed confidential IPO paperwork with the Securities and Exchange Commission in June and is pursuing a listing in 2027. Chief Financial Officer Sarah Friar told employees in August that OpenAI “will be a public company in 2027,” CNBC reported, while CEO Sam Altman said in September that “right now would be an ill-advised moment to go public.” The company has also told investors it is aiming for roughly $600 billion in total compute spending by 2030, a figure that helps explain why it keeps returning to private markets for cash.

The next markers to watch are the size of the first close, whether the UAE computing deal is signed alongside it, and how the retail offering for wealthy individuals is priced and timed. OpenAI has not publicly commented on the FT report.

Sources

• CNBC / Reuters: OpenAI slashes funding target by $10 billion amid tech rout, FT reports (Oct. 31, 2026)
• CNBC: OpenAI nears up to $30 billion funding round at $1.25 trillion valuation led by UAE investors (Oct. 22, 2026)
• TechCrunch: OpenAI working on new $30B raise at $1.25T valuation ahead of IPO (Oct. 22, 2026)
• OpenAI: New funding to scale the benefits of AI (Oct. 2, 2024)
• OpenAI: New funding to build towards AGI (Mar. 31, 2025)
• Reuters: OpenAI hits $500 billion valuation after share sale (Oct. 2, 2025)