OpenAI’s annual recurring revenue (ARR) has nearly doubled to $10 billion, underscoring the surging demand for its artificial intelligence tools such as ChatGPT. The sharp rise from $5.5 billion at the end of last year signals that consumers and businesses alike are increasingly willing to pay for AI services, even as profitability remains years away, the Financial Times reported.
The milestone, first reported by CNBC and confirmed by the company, highlights OpenAI’s extraordinary growth since launching ChatGPT in late 2022. The chatbot quickly became the fastest consumer application to reach 100 million weekly active users, and now boasts more than 500 million users globally.
The boom mirrors trends across the AI sector. AI coding tool Cursor has raced to $500 million in ARR this year, up from under $100 million in 2024. Anthropic, backed by Google and Amazon, tripled its ARR to $3 billion between January and May, according to a source familiar with the matter.
AI revenues surge but losses persist
Despite the revenue surge, none of the leading AI companies are yet profitable. OpenAI has told investors it does not expect to reach profitability until 2029, when it projects revenues of $125 billion. In the meantime, aggressive investor backing has fueled rapid expansion.
OpenAI is currently raising $40 billion in new funding from investors including SoftBank. Anthropic has secured major backing from Google, Amazon, and top venture capital firms. Cursor parent Anysphere recently raised $900 million from Thrive Capital, Accel, and Andreessen Horowitz.
This investment arms race reflects a belief that the largest AI players can scale quickly enough to dominate the market, despite heavy upfront costs.
Adoption may be plateauing in some sectors
There are early signs that AI adoption growth is beginning to level off. The proportion of U.S. businesses paying to use AI models has quadrupled to about 40 percent over the past two years, according to fintech company Ramp. However, that growth stalled in May for the first time in 10 months, suggesting that much of the immediate demand may have already been tapped.
Still, OpenAI’s revenue base remains strong. According to a spokesperson, the company’s ARR now comes from a mix of paid ChatGPT consumer subscriptions, roughly 3 million business and education subscriptions, and sales of its API to developers and corporate customers.
Expansion into hardware and major infrastructure projects
OpenAI continues to expand its footprint in both software and hardware. It recently acquired io, a hardware start-up founded by former Apple design chief Sir Jony Ive, in a $6.4 billion deal. The company is also pursuing the acquisition of Windsurf, a rival to code editing tool Cursor, according to people familiar with the matter.
In parallel, OpenAI is collaborating with the Trump administration on Stargate, a massive data centre project that CEO Sam Altman says will support future breakthroughs in AI.
Even as investor enthusiasm fuels the sector, OpenAI’s growing revenue suggests that AI tools are beginning to deliver on the commercial promise that has surrounded them for the past two years.
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