Synopsis
OpenAI CFO Sarah Friar raised concerns about risks in Sam Altman’s plan to go public by late 2026 and heavy spending. She questioned readiness, rising costs for AI servers, and whether slowing revenue growth could support such large commitments, according to the report.Friar reportedly doubts whether OpenAI is ready for such an ambitious timeline. She has highlighted risks from the company’s heavy spending and the organisational and procedural work still needed to prepare for an IPO.
Altman’s wants to go ahead despite expectations that the company will burn through more than $200 billion before generating steady cash flow.
Friar reportedly told colleagues that a 2026 IPO might be too soon. She questioned whether the company truly needs to invest so much in AI servers and whether its slowing revenue growth would be enough to support such commitments.
This comes just as OpenAI secured investment commitments totalling $122 billion, valuing the company at around $852 billion. Those pledges may have eased some of Friar’s worries. Most of this funding will come from Amazon and Nvidia, which supply the cloud servers and chips OpenAI relies on. The deal is part of a bigger circular financial arrangement among top AI companies.
Strained CEO-CFO relationship
The report also highlighted the seemingly growing tension between Altman and Friar. She was reportedly left out of key financial discussions, including talks about server spending with one of OpenAI’s top investors. Her absence was noticeable because she had previously been involved in discussions on the same topic, the report said, citing sources.
In addition, Friar no longer reports directly to Altman. Since August last year, she has reported to Fidji Simo, who leads OpenAI’s applications business. Simo recently told staff she would be taking a short medical leave, amidst a leadership shakeup in the company.
Rising pressure and competition
Even with fresh funding, OpenAI will need to keep raising large amounts of capital from investors. The company faces pressure to meet revenue and user growth targets as its spending rises.
Additionally, competition is intensifying. Anthropic has overtaken OpenAI in selling AI models to businesses and developers, while Google’s Gemini is gradually challenging ChatGPT in the consumer chatbot market.
According to The Information’s report, OpenAI’s gross profit margins last year were lower than expected, largely because the company had to buy expensive computing resources at short notice to meet higher-than-expected demand. To generate more revenue, OpenAI began displaying ads to non-premium users in February.
OpenAI’s IPO
An IPO could value OpenAI at up to $1 trillion. Altman reportedly wants the company to go public before rival Anthropic, which may list as early as October and could raise over $60 billion.
Major banks such as Goldman Sachs Group, JPMorgan Chase & Co, and Morgan Stanley are expected to play key roles in both listings.
The IPO follows a restructuring that reduces OpenAI’s reliance on Microsoft and makes capital raising easier. Going public would also allow the company to fund acquisitions using stock, supporting Altman’s plan to invest heavily in AI infrastructure.
As quoted by Reuters, Altman himself noted during a livestream, "I think it's fair to say it is the most likely path for us, given the capital needs that we'll have."
OpenAI was founded as a non-profit in 2015, but later created a for-profit arm. The non-profit, now called the OpenAI Foundation, holds a 26% stake and can acquire more shares if certain milestones are met. This ensures it remains closely tied to the company’s financial success.
