OpenAI’s light balance sheet faces a hard IPO look



OpenAI’s books show zero debt and just $46mn of quarterly capital spending. The catch, reported by The Information: around $665bn of commitments sitting just off the balance sheet, now heading for regulators’ desks.

On paper, OpenAI looks like a lean software business. The reality is far heavier.

As at 31 March, the ChatGPT maker had zero debt and less than $750mn of lease liabilities, according to The Information, which reviewed its financial statements. Its capital spending for the quarter came to just $46mn. That is less than Salesforce, a company that merely sells software.

For one of the most hardware-hungry businesses in tech, those are remarkable numbers.

The $665bn hiding off the books

The spending has not vanished. It has moved off the balance sheet.

OpenAI carries around $665bn of purchase commitments that do not show up as debt. Most of it is compute: long-term deals to rent the data centres and chips its models run on.

The company leans on Microsoft, Oracle, Amazon and joint ventures such as Stargate and Fluidstack for that capacity. The obligations are real and enormous. They simply do not appear where investors usually look.

A web of related parties

The structure raises a second question. Who sits on the other side of these deals?

About 72 per cent of OpenAI’s cost of revenue flows to related parties such as Microsoft. Microsoft is both a major backer of the company and one of its key suppliers.

That kind of concentration invites scrutiny over conflicts of interest. It is exactly the sort of arrangement that public-market regulators tend to probe.

Why it matters now

This is landing as OpenAI prepares to go public. It filed confidentially with the SEC on 8 June, a week after rival Anthropic, with Goldman Sachs and Morgan Stanley leading the deal.

The filing valued OpenAI at about $852bn. Analysts think a debut could push it past $1tn, perhaps this autumn. It follows SpaceX, which listed in June in the largest IPO on record.

The filing also hands financial regulators their first proper look at OpenAI’s accounting and its tangle of business relationships.

The valuation has to catch up

None of this would matter if the growth were already there. It is not.

OpenAI projects advertising revenue rising from $2.4bn this year to $102bn by 2030, when ads would be more than a third of its sales. Ad group WPP expects the entire AI search and chatbot ad market to be worth about $101bn in 2030. That figure already includes Google.

In short, OpenAI is forecasting that it can capture, on its own, a whole market the rest of the industry will be fighting over.

The bottom line

The cash, meanwhile, keeps pouring out. OpenAI spent about $34bn last year and burned through $3.7bn in the first three months of 2026 alone.

A clean balance sheet usually reassures investors. This one may do the opposite. Zero debt means little when $665bn of commitments sit just out of frame. Sceptics already warn that an OpenAI stumble could ripple across the whole AI supply chain.



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Recent Reviews


I am a recent convert to physical media — yet even as someone getting back into buying discs in 2026, I haven’t been buying Blu-rays. Like many Americans, I still pick up DVDs instead. These aren’t great times for the Blu-ray format, and don’t expect a turnaround in 2026.

Fewer new releases make their way to Blu-ray

More media is now released exclusively for streaming

Blu-ray has been around for two decades, but it never managed to fully replace, or even overtake, the DVD format it was designed to supersede. We still can’t take for granted that our favorite movies, let alone TV shows, will eventually see a Blu-ray release.

The movies most likely to come to Blu-ray are the ones that hit theaters, but a growing amount of cinema is designed exclusively with streaming platforms in mind. I recently rewatched Mississippi Masala, which led me to check in on what work Sarita Choudhury has done over the decades since. A film called Evil Eye released in 2020 caught my eye. Unfortunately, it’s only available via Prime Video. There’s no Blu-ray or even a DVD. In contrast, it’s easy to watch Michael B. Jordan in Sinners on Blu-ray, since that movie came to theaters last year.

You could say that it makes sense that a movie with a 4.8/10 rating on IMDb doesn’t see a physical release, but in the heyday of physical video, store shelves were stacked not only with just the big-budget bangers but plenty of straight-to-DVD movies as well. Now those films exist to pad out streaming catalogs instead.

Fewer big box stores stock their shelves with physical discs

Blu-ray discs have disappeared from some stores entirely

Best Buy store front
Best Buy

The format’s demise is striking. I frequent my local Best Buy quite often and don’t see any movies on display. That’s because the retailer stopped selling movies in stores several years ago. Walmart still sells them, but the selection is a fraction of what you could find ten or twenty years ago. The audience has been reduced down to the shrinking number of people whose internet at home can’t handle streaming and those who might think of themselves as collectors.

If you venture onto Reddit and visit r/Blu-ray, you will find more threads about thrift store hauls and older collections than excitement over the latest new release. Don’t get me wrong — I, too, am very excited about seeing what gems I can snag for only a couple bucks, but this shows the challenge retailers face. Increasingly, only enthusiasts are prepared to drop over $20 on a disc.

I’m not buying discs to stick them in a player

Phone on a stand playing a Netflix video Credit: Bertel King / How-To Geek

The simple truth is that most people don’t want to buy physical media. Discs don’t fit in phones, and the drives are no longer available in most laptops. Even desktop PCs lack a place to put a disk. I recently built a PC for the first time in part to digitize my media library, and I rely on an external DVD drive connected via USB. Yes, DVD, not Blu-ray. A smaller file size combined with upscaling is easier on my hard drive.

Retro nostalgia hasn’t helped Blu-ray in the same way it has aided vinyl. This is in part because most people simply don’t care all that much about video quality. Most are streaming video on Netflix and YouTube at middling settings on small screens, and many of us are acclimated to mid-range phone speakers, compared to which even the subpar built-in speakers on modern TVs sound like a huge step-up. It’s hard to convince large numbers of people to purchase an expensive version of a movie in a format that requires thousands of dollars of home media equipment to truly appreciate.

4K Ultra HD is in an even worse position

It’s been a decade, yet few people own these discs

The 4K Ultra HD Blu-ray format is an enhancement, rather than a replacement, of the Blu-ray discs that first appeared in 2006. Debuting in 2016, the 4K Ultra HD format supports the max resolution of a 4K TV.

4K TVs were still somewhat of a novelty ten years ago, but they’re cheap and commonplace today. Still, people aren’t demanding 4K-quality Blu-ray movies as a result. These discs are still less common than 1080p ones, which are themselves still outnumbered by DVDs.

This isn’t merely a matter of consumers preferring the cheaper option. Often, 4K simply isn’t a choice, or it’s one that arrives significantly later, like the Switch port of a PC title. Some recent films, like Exit 8, are slated to see a physical release over the summer yet will still be in 1080p when they do. Adoption of the newest format has been that slow.

The industry isn’t helping itself, either. 4K Ultra HD Blu-ray discs come with DRM and aren’t easy to play on a modern PC, further limiting potential growth. They do not want anyone pirating these super high-quality versions. When you consider that some of these 4K Blu-rays have an AI upscaling problem, you’re paying more for what may not even be the best version.​​​​​​​


Blu-ray is seeing fewer releases, is available in fewer places, and is less accessible in the ways many of us want to watch TV shows and movies in 2026. With our portable devices getting better and internet speeds getting faster, it’s hard to see physical video staging a turnaround, even if we’re still a long way off from it going away entirely.



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