OpenAI has recently reached a revenue of over $1.6 billion, only two months after hitting the $1.3 billion mark.

This news was reported by The Information, which cited two people familiar with the matter. It also mentioned that OpenAI is also looking to raise more funds, aiming for a value of at least $100 billion.

This increase in sales started when OpenAI introduced ChatGPT Plus, a premium version of its ChatGPT service, in February 2023. Before this, the company mainly earned money by offering its artificial intelligence (AI) technology to developers. Despite its efforts, OpenAI faced a loss of $540 million in 2022, with a revenue of only $28 million.

OpenAI Shocks Critics With Stellar Revenue Figures

In 2022, Reuters reported that OpenAI had an initial target of $200 million in revenue for 2023, with the $1 billion mark being reached in 2024. However, ChatGPT Plus turned out to be more successful than expected, leading to a rapid increase in revenue.

A recent report from Bloomberg shows that OpenAI’s earnings grew rapidly, reaching nearly $1 billion in August. Just two months after, The Information reported an annual revenue of $1.3 billion for OpenAI.

This most recent update reveals that OpenAI’s annual revenue has now crossed $1.6 billion, showing a significant increase of more than 20% in just the past two months. In fact, compared to the annual revenue of $28 million recorded in 2022, it appears the company’s yearly income has skyrocketed by approximately 5,700%.

This dramatic rise is likely to catch the eye of investors. According to Bloomberg, OpenAI is planning to start a new funding round, aiming for a valuation of over $100 billion. Details about who might invest in the company this time are still not known.

Leadership Upheaval in OpenAI

OpenAI’s recent financial achievements are especially impressive when you consider its recent major upheaval, which ended with Sam Altman returning as CEO. This decision followed an unexpected period of disruption that started with Altman’s sudden firing, leading to a potential mass exit of employees. Altman’s return is a strategic move to stabilize the company’s leadership and concentrate on advancing AI research and safety efforts.

In addition, OpenAI introduced a new board of directors. Bret Taylor was been named Chairman, with former US Treasury Secretary Larry Summers and Adam D’Angelo joining as board members. Microsoft, a significant partner of OpenAI, now holds a non-voting observer role on the board, reflecting their close collaboration and shared interests in AI development.

In a message to the staff, Altman had conveyed his gratitude and emphasized OpenAI’s commitment to transparent and responsible management. The new board structure aims to reduce internal conflicts and ensure responsible governance.

However, OpenAI is currently under the spotlight for a different reason. The New York Times has sued it and Microsoft for using its articles without permission to train their AI systems, like ChatGPT and Copilot. This lawsuit is a big deal because it could affect not just these two companies but the whole AI industry.

The Times claims that OpenAI and Microsoft have built businesses worth billions by using its content for free. This, according to the newspaper, has cost them money in terms of lost licensing fees and competition for readers and ad revenue.

The New York Times provided detailed evidence in its lawsuit showing how Microsoft and OpenAI’s AI services have copied parts of its articles. The Times believes that these companies have used millions of its articles without permission, based on how extensively OpenAI has collected data from the web and Microsoft’s access to archived articles. Earlier in the year, the Times had even blocked OpenAI’s bots from accessing its new content.

Although the Times said that it tried to work out a deal for fair payment for using its content, the negotiations with Microsoft and OpenAI were unsuccessful. The newspaper argues that what these tech companies have done violates copyright laws and goes beyond what is normally allowed under fair use rules.

Ultimately, the newspaper is asking for billions in damages and wants the companies to stop using its articles in their AI models. The decision could make or break not just OpenAI’s business model but every other LLM trained on copyrighted material.

Impact on Valuation and Future Prospects

OpenAI is currently at a crossroads with its rapid revenue increase and ongoing legal issues, leading to a complicated situation for its future. The company has seen financial growth and made significant advances in AI, but the lawsuit from The New York Times brings in a level of uncertainty. This legal challenge questions how OpenAI runs its business and may affect its value and appeal to investors.

The lawsuit’s outcome is particularly crucial as it could influence the entire AI industry. It may determine the rules for how AI companies use publicly available data for developing their technologies. As OpenAI deals with this issue, both its market value and future prospects could be significantly impacted.