OpenAI, the creator of ChatGPT, is setting its sights on a threefold increase in revenue to $12.7 billion this year, notwithstanding the burgeoning competition from Chinese AI companies like DeepSeek and other rapidly advancing rivals. Persons privy to the matter revealed to Bloomberg on March 26 that OpenAI’s revenue target for 2025 is expected to more than double to $29.4 billion by 2026.
This projection supersedes the earlier $11.6 billion revenue target for 2025 as reported by The New York Times in September. The majority of ChatGPT’s revenue has been generated from its paid AI software subscription services for consumers and businesses.
As of last September, OpenAI reportedly amassed 1 million paid users for its corporate versions of ChatGPT and recently introduced a $200 monthly ChatGPT Pro option. Despite these strides, the Sam Altman-led company does not foresee being cash-flow positive until 2029, when its revenue is projected to exceed $125 billion.
OpenAI is said to be on the verge of closing a $40 billion funding round led by SoftBank Group, which could value the company at up to $300 billion. The company is also contemplating a transition from its current nonprofit business model to a for-profit venture.
In the wake of the release of DeepSeek’s ChatGPT rival, “R-1,” other Chinese tech companies have brought forth a series of high-quality, cost-effective AI solutions, intensifying competition. Baidu Inc. and Alibaba Group have unveiled their respective AI models, Ernie X1 and a new open-source model, to compete with DeepSeek’s R-1. Additionally, Tencent Holdings launched its own AI chatbot under its subsidiary Ant Group Co, while DeepSeek rolled out its latest model — DeepSeek-V3-0324 — on March 24.
These fresh and typically cheaper alternatives are exerting pressure on the business strategies of leading US firms. As Balaji Srinivasan, a tech investor and ex-general partner at tech-focused venture capital firm Andreessen “a16z” Horowitz, noted in a March 22 X post, “China is trying to do to AI what they always do: study, copy, optimize, and then bankrupt everyone with low prices and enormous scale.”
CEO of 01.AI, Lee Kai-fu, informed Reuters on March 25 that Chinese AI firms, thanks to DeepSeek’s efforts, are now only lagging three months behind their US counterparts, a significant improvement from the previous six to nine months gap. Meanwhile, OpenAI’s CEO, Sam Altman, announced on Feb. 12 that the company is gearing up to launch GPT-4.5 and GPT-5 in the near future, promising enhanced features and a higher level of intelligence for Plus and Pro subscribers.
