Why Is OpenAI’s Annualized Revenue $20 Billion Below Expectations? AI Infrastructure Investment Faces Repricing

TradingKey - According to the Financial Times, OpenAI recently informed investors that as of the end of September, its annualized revenue was close to $50 billion, about $20 billion lower than the $70 billion widely reported by media earlier.

Following the news, AI-related stocks weakened across the board, with the Nasdaq 100 Index falling 1.4%, and computing power and infrastructure companies such as Nvidia (NVDA), Oracle (ORCL), and Micron (MU) all experienced notable pullbacks.

Why $50 Billion Is Lower Than Previously Reported

Annualized revenue is not the actual full-year revenue already realized by a company, but rather an extrapolation of its revenue scale for the upcoming year based on revenue from the most recent month or quarter. While this metric reflects a business's current growth rate, it is easily affected by the timeframe analyzed and the calculation methodology.

The Financial Times reported that OpenAI's latest investor materials show the company's annualized revenue in July was close to $30 billion. The previously circulated market figure of $40 billion was an adjusted figure derived by some investors who included sales generated through OpenAI's partners to compare it with Anthropic.

Subsequently, OpenAI informed investors that its annualized revenue had grown by more than 70% since July. The market extrapolated based on the adjusted $40 billion baseline, thereby arriving at a figure close to $70 billion. However, if using the approximately $30 billion disclosed by OpenAI itself as the starting point, a 70% increase corresponds to a figure closer to $50 billion.

Therefore, this disclosure serves more as a correction to the market's calculation methodology rather than a sudden revenue reduction by the company. A figure of $50 billion still indicates that OpenAI maintained rapid growth in the third quarter; it is just that the previous $70 billion estimate overstated the current scale of its business.

Differences in Revenue Accounting Metrics Between OpenAI and Anthropic

The main difference between the two companies lies in how they account for sales revenue generated through cloud partners.

Anthropic sells its Claude services through platforms such as Amazon AWS and Google Cloud and includes those transaction amounts in its own revenue. OpenAI, by contrast, does not include all sales from similar partner channels in its annualized revenue metric. Consequently, even if the two companies face similar customer demand, their final disclosed figures can differ significantly.

In other words, Anthropic uses an accounting basis closer to gross figures that include cloud channel sales, whereas OpenAI's disclosed data leans more toward directly recognized revenue.

Gil Luria, managing director at D.A. Davidson, noted that the related reports sparked "unnecessary concern" in the market, as the previous $70 billion figure itself may not have accurately reflected OpenAI's actual standing.

Evan Schlossman, head of Neostellar, also stated that this change is primarily a clarification of revenue reporting methods and does not equate to a marked deterioration in underlying demand.

OpenAI Revenue Data Weighs on AI-Related Stocks

Even if $50 billion does not represent a decline in demand, the figure remains below the valuation baseline previously used by the market. OpenAI is both an AI model developer and a major buyer of chips, cloud computing, and data center resources, and its revenue growth is regarded as a key metric for testing the commercialization capabilities of the entire AI industry.

If OpenAI's revenue falls short of previous market expectations, investors will naturally reassess whether its massive infrastructure spending can generate sufficient returns. OpenAI has already committed to spending hundreds of billions of dollars on computing power in the coming years and is projected to consume nearly $280 billion in cumulative funding by 2030. Under these circumstances, a $20 billion revenue shortfall will draw greater market focus to its financing capacity, cash burn, and return on capital.

Following the news, Nvidia fell 2.9%, AMD (AMD) fell 3.9%, Broadcom (AVGO) fell 4.3%, Micron and SanDisk (SNDK) fell 4.8% and 4.9% respectively, while Oracle fell 5.5%.

What these companies have in common is that their revenue expectations are all, to varying degrees, built on the sustained rapid growth of AI computing demand. Following doubts over OpenAI's revenue figures, the market grew concerned that the commercialization pace of AI model developers might lag behind the expansion rate of investments in data centers, chips, and power infrastructure, prompting investors to proactively reduce risk exposure to the AI supply chain.