Big Question Determining AI Deals: How Much Can OpenAI Raise This Round?

OpenAI’s ability to successfully complete a new round of massive financing is no longer just a matter of its own survival, but has become a crucial variable in determining the entire AI sector’s trading logic. Although market rumors suggest OpenAI’s next round of financing could reach as high as $150-170 billion, if true, this would ensure its funding chain lasts until 2030 and could drive a substantial rally across the whole AI sector. However, real-world uncertainties are increasing. According to a previous article by WallstreetCN, Jensen Huang clarified on January 31 that while the chip giant “will definitely participate” in OpenAI’s new round of financing, the amount is nowhere near the size speculated by the outside world. On February 2, The Wall Street Journal reported that this funding gap has triggered a chain reaction, directly impacting Oracle, which provides computing power to OpenAI. Previously, Oracle included its $300 billion contract with OpenAI as remaining performance obligations (RPO), supporting its earlier stock price surge. Analysis points out that now, with adjustments in core investors’ willingness to contribute, investors have begun to doubt whether OpenAI can pay this astronomical sum and whether Oracle’s full inclusion in its accounts is prudent accounting. The report notes that Oracle currently faces a dilemma: on one hand, it needs to raise funds by issuing stock to defend its investment-grade credit rating; on the other, it must address shareholder dilution concerns after its share price has halved since last September’s peak. Financing Scale Uncertainty The final scale of OpenAI’s current round of financing is the “winning hand” in deciding the direction of funding across the AI industry chain. On February 2, the latest market rumor circulating on social platform X claimed that OpenAI’s next round of financing could reach $150-170 billion. This optimistic expectation is seen as fuel for whether the entire AI complex can continue its surge. However, actual progress on the financing front is full of uncertainties. According to The Wall Street Journal report last Friday, due to internal doubts at Nvidia, the previously disclosed Letter of Intent between the two parties in September — that Nvidia would invest up to $100 billion in OpenAI over several years — has now stalled. Nvidia CEO Jensen Huang clarified on January 31 that when asked if the investment would exceed $100 billion, he stated: “No, no, not at all.” Although he confirmed Nvidia would definitely participate in OpenAI’s latest financing, the scale is definitely shrinking. To fill the funding gap, OpenAI is seeking support from other giants. After SoftBank invested $22.5 billion in OpenAI last December, raising its stake to 11%, it is reportedly negotiating for a further investment of up to $30 billion. Additionally, Amazon is in contact with OpenAI about participating in this round of financing. Given that OpenAI is estimated to have up to $1.4 trillion in various commitments, whether it can successfully raise vast amounts from these investors will directly determine its capacity to deliver. Oracle’s $300 Billion Gamble The relationship between OpenAI and Nvidia has long been regarded as a microcosm of “cyclicality” in AI trading: Nvidia invests in OpenAI, OpenAI uses the funds to buy computing power from Oracle, and Oracle in turn uses this revenue to buy Nvidia’s chips. The uncertainty in OpenAI’s financing exposes its core supplier Oracle to huge risks. As of November 30, Oracle reported remaining performance obligations (RPO) of $523 billion, about nine times its income over the past four quarters. Notably, this includes the $300 billion contract related to OpenAI. In early September last year, it was precisely because the financial report showed RPO more than quadrupled from the previous quarter that Oracle’s stock price soared by up to 36% in a single day. Oracle spokesperson Deborah Hellinger stated: > “The Nvidia-OpenAI transaction has zero impact on our financial relationship with OpenAI. We are confident in OpenAI’s ability to raise capital and fulfill its commitments.” However, according to accounting standards, only when management determines collection is “probable” can it include the $300 billion in RPO. If OpenAI cannot pay in full, or other clients need to fill the gap, the credibility of the book figures will sharply decline. This also poses an urgent question for Oracle management: In its upcoming financial report, will they still judge recovering $300 billion from OpenAI as “probable”? This judgment will directly impact market confidence. Defending Oracle’s Balance Sheet Amid concerns about OpenAI’s fulfillment capacity and its own debt levels, Oracle is taking action to maintain its financial credit. On February 1, Oracle announced plans to issue up to $20 billion of common stock this year as part of a broader plan to raise $45-50 billion through equity and debt financing to expand its cloud infrastructure business. According to reports, although this move will dilute shareholder equity — and occurs when the stock price is about half of last September’s peak — in the current climate of uncertainty in AI deals, increasing equity buffer is seen as prudent. Oracle is currently borrowing heavily to build data centers, and these investments largely rely on contracts signed with OpenAI. Market concerns are already manifest in the bond market. Oracle currently enjoys a BBB credit rating but has been placed on negative watch lists by S&P and Moody’s, facing a downgrade risk. Some of its debt (including 10-year notes issued in September) is now trading near junk bond levels, and its credit default swap cost has surged. Risk Disclosure and Disclaimer The market has risks; investors need to exercise caution. This article does not constitute personal investment advice and has not considered the special investment goals, financial situation, or needs of individual users. Users should consider whether any views, opinions, or conclusions in this article align with their specific circumstances. Invest at your own risk.