'122% negative margin': OpenAI's trillion-dollar IPO to go public soon
&imwidth=600&imheight=450&format=webp&quality=medium "'122% negative margin': OpenAI's trillion-dollar IPO to go public soon")
'122% negative margin': OpenAI's trillion-dollar IPO to go public soon Photograph: (X | OpenAI)
OpenAI filed a confidential S-1 with the SEC in May, targeting a September listing at a valuation between $852 billion and $1 trillion, with Goldman Sachs and Morgan Stanley leading. The full prospectus becomes public mid-to-late August — revealing the finances behind roughly $25 billion in annualised revenue and a reported negative 122 per cent non-GAAP operating margin.
The most closely guarded financial statements in technology are about to become a public document. OpenAI's full IPO prospectus is expected this month.
The Filing
OpenAI confidentially filed its S-1 prospectus with the US Securities and Exchange Commission on May 22, 2026. Confidential filing is a permitted route that allows a company to begin the listing process without immediately publishing its finances — but the document becomes public roughly fifteen days before the IPO roadshow begins.
With a listing targeted for as early as September, the full prospectus is expected to become visible mid-to-late August. Goldman Sachs and Morgan Stanley are leading the deal. The targeted valuation range runs from $852 billion to $1 trillion.
What Is Already Known
The figures that have emerged describe a company growing at extraordinary speed while losing money at a comparable rate.
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OpenAI generated close to $6 billion in revenue in the first quarter alone, putting it on an annualised run rate of roughly $25 billion. More than 230 million people use ChatGPT weekly. By revenue growth, few companies in history have scaled faster.
The other number is the one the prospectus will have to explain: a reported negative 122 per cent non-GAAP operating margin for the quarter. At that margin, the company loses roughly $1.22 for every dollar it earns.
Losses at scale are not unusual for companies going public — Amazon and Uber both listed while unprofitable. What distinguishes this case is the size of the obligations sitting alongside the losses.
The Commitments The Prospectus Must Account For
OpenAI has raised its projected compute spending to approximately $750 billion through 2030. Among the contracts already signed: roughly 6 gigawatts of Oracle data centre capacity, an expanded Amazon Web Services arrangement worth $138 billion over eight years, and a $250 billion incremental commitment through Microsoft Azure.
It is also building its own facilities. Project Camellia, a $20 billion data centre in Effingham County, Georgia, marks the first time OpenAI is lead designer and builder rather than tenant, with 3.2 gigawatts of contracted power.
Financing those commitments has required unusual structures. Nvidia is reportedly in talks to guarantee some $250 billion in lease and construction financing for OpenAI's 10-gigawatt Ohio campus, with a parallel discussion covering up to $350 billion more for chips — a backstop needed because OpenAI, being unprofitable, cannot obtain an investment-grade credit rating on its own.
Chief financial officer Sarah Friar has privately raised concerns that the company may be unable to honour its computing contracts if revenue growth does not keep pace.
What Public Markets Change
Everything above is drawn from reporting, leaks and partial disclosures. The prospectus is different in kind: an audited document, filed under penalty of law, that must set out revenue by segment, unit economics, cost structure, contractual obligations and risk factors in a form investors can hold the company to.
The timing is not favourable. More than $1.3 trillion was erased from semiconductor market values in late July as investors began questioning whether AI infrastructure spending will produce adequate returns. Meta's shares fell around 10 per cent on a 91 per cent collapse in free cash flow. AI-related securities class actions, though only 13 per cent of filings this year, account for nearly three-quarters of all alleged investor losses.
OpenAI is bringing the largest AI listing in history to a market that has just stopped extending AI companies the benefit of the doubt. The prospectus will be read by people looking for reasons to be sceptical, and it will be the first time they have audited numbers to work from.
