OpenAI Cuts Its Funding Target by $10 Billion as Tech Stocks Slide, Report Says

OpenAI has reportedly scaled back one of the largest private funding rounds in tech history. According to a Financial Times report carried by Reuters on October 30, 2026, the ChatGPT maker cut its target by $10 billion and is now seeking about $20 billion. The report also puts its desired valuation lower than before, at $1.25 trillion instead of $1.4 trillion.

The timing is hard to miss. The revision arrived during a sharp selloff in technology stocks, when investors were asking tougher questions about how quickly huge spending on AI infrastructure will pay off. OpenAI did not immediately respond to Reuters requests for comment, so the details remain reported figures rather than a confirmed announcement.

What the report says

OpenAI was earlier planning to raise $30 billion at a $1.4 trillion valuation, Reuters reported earlier in October 2026. The Financial Times report now puts the target at about $20 billion, with a desired valuation of $1.25 trillion.

The report also says OpenAI set a Friday deadline for investors to commit to the round. Even so, the first close is expected to raise less than $20 billion, after some investors reduced their allocations. A first close is the first batch of money that actually comes in, and later closes can follow. A smaller first close does not mean the round is over, but it does suggest some investors wanted a smaller cheque than first planned.

None of this has been confirmed by OpenAI in the reporting so far. The figures come from people with knowledge of the matter, as cited by the Financial Times. Readers should treat the $20 billion and $1.25 trillion figures as reported, not as final, until OpenAI or its investors confirm them.

Why the timing matters

The funding revision landed in the middle of a rough week for US tech stocks. Reuters reported that the tech heavy Nasdaq index dropped 2.9 percent on Friday, October 30, and was down 7.8 percent from its all time closing high reached on October 6. That context helps explain why a funding target can move so quickly.

Investors have spent much of October weighing two competing facts. On one side, the biggest tech companies are committing enormous sums to data centers, chips, and power for AI. On the other side, the payoff from that spending is still uncertain, and recent earnings reports gave the market fresh reasons to pause. Alphabet shares fell sharply after its quarterly spending on property and equipment came in above $51 billion, much of it earmarked for AI infrastructure, according to reports from that week. Intel shares also fell hard after a weak profit forecast for the coming quarter.

OpenAI sits at the center of that debate, even though it is not a listed company. When its funding terms soften, even modestly, traders read it as a signal about risk appetite across the sector. A $150 billion drop in desired valuation sounds large, yet it still leaves OpenAI valued above $1 trillion on the reported terms.

Who is reportedly backing the round

According to the Financial Times report, a consortium of investors from the United Arab Emirates that includes the state backed technology fund MGX is expected to be the largest participant in the round. As part of the deal, OpenAI would gain the option to lease newly developed computing capacity in the region, the report added.

That computing angle is worth noting. For an AI lab, money and computing capacity are closely linked, because training and running large models consumes enormous amounts of processing power. A deal that pairs investment with a lease option on computing capacity would fit that pattern, if the reported terms hold.

Venture capital firms including Founders Fund, Coatue, Sequoia Capital, and Andreessen Horowitz are also expected to participate, according to the report. Their presence would signal that established tech investors are still willing to back OpenAI at a very high valuation, even if some reduced the size of their commitments. MGX, Coatue, Sequoia Capital, and Andreessen Horowitz did not immediately respond to Reuters requests for comment outside regular business hours, the report said.

The race with Anthropic and a possible 2027 listing

Reuters has previously reported that OpenAI is pursuing a listing in 2027, and that it has been keen to close this funding round partly to get ahead of Anthropic. The two frontier labs are tapping a similar investor base, so timing can matter. If one lab closes a large round first, it can absorb capital and attention that might otherwise go to the other.

What this does and does not prove

A smaller funding target does not prove that AI spending has peaked, and it does not prove that OpenAI is in trouble. Funding rounds move for many reasons, including market timing, investor allocation limits, and the simple fact that a company may decide it needs less cash than first planned. Some investors reducing allocations could reflect portfolio limits after a market drop, rather than a loss of faith in the company.

The next facts to watch are concrete. Will OpenAI confirm the round, and at what size and valuation? Will the first close land near $20 billion or below it? Will the reported retail offering go ahead, and will the MGX computing lease option be confirmed? For now, the careful summary is this: according to the Financial Times, as reported by Reuters on October 30, OpenAI cut its funding target by $10 billion to about $20 billion and lowered its desired valuation to $1.25 trillion, during a week when tech stocks fell on worries about AI spending. It is a sign of a cooler funding climate, not a final judgment on AI itself.

Frequently Asked Questions

How much is OpenAI reportedly raising now?

According to the Financial Times report carried by Reuters on October 30, 2026, OpenAI is now seeking about $20 billion, down from an earlier plan to raise $30 billion. The first close is expected to raise less than $20 billion after some investors reduced their allocations.

What valuation is reported for the round?

The report puts OpenAI’s desired valuation at $1.25 trillion, down from $1.4 trillion in the earlier plan. Wealthy individuals would reportedly have the option to invest in a later retail offering at the same $1.25 trillion valuation.

Has OpenAI confirmed the new funding target?

Not in the reporting so far. OpenAI did not immediately respond to Reuters requests for comment outside regular business hours, according to the report. The figures should be treated as reported until the company or its investors confirm them.