Regarding the timing of the IPO, there are internal disagreements at OpenAI: Altman hopes for the fourth quarter, while the CFO believes they are not yet ready.

OpenAI’s internal tension between an aggressive expansion strategy and financial prudence is coming to the surface. According to The Information, CEO Sam Altman has privately expressed his hope to complete an IPO as early as the fourth quarter of this year, while CFO Sarah Friar had conveyed a sharply opposing view to colleagues earlier this year, believing the company is not yet ready to go public. Friar’s concerns point directly to financial realities: OpenAI has committed to spending over $600 billion on server rentals over the next five years, while warning investors that its cash burn through 2030 will be more than twice previous forecasts, potentially exceeding $200 billion. A person who spoke with Friar revealed that she remains doubtful whether the company’s slowing revenue growth can support such spending commitments. Meanwhile, competitor Anthropic is eroding OpenAI’s market share, further intensifying external pressures. In response to reports about a rift between the two, Altman and Friar released a joint statement, saying they are "fully aligned on making durable access to compute a core OpenAI strategy," and that both have "directly participated in every major compute decision" over the past year or more. Differences in IPO Timeline Despite Friar’s reservations, OpenAI has already begun preparatory work for the IPO. The company has hired law firms Cooley and Wachtell Lipton Rosen & Katz, and has started informal talks with Goldman Sachs and Morgan Stanley’s IPO underwriting teams. Altman’s desire to list has an obvious competitive motivation; he has privately said he wants OpenAI’s IPO to precede Anthropic’s, which is currently discussing a fourth quarter listing. If OpenAI goes public, the transaction could rank among the largest IPOs in history. Friar’s resistance to a rapid IPO is not unfounded. In a Wall Street Journal interview last November, she publicly stated that an IPO was "not on the agenda right now" because the company is still working to "get the company aligned with its current scale." A Quiet Shift in Internal Power Structure On the organizational level, an unusual change has already taken place: since last August, Friar no longer reports directly to Altman, but instead to Head of Applications Fidji Simo. It is rare for a CFO at a large firm to report to anyone other than the CEO. According to several people who work closely with both, Altman has excluded Friar from several important discussions on financial planning. One such case: Altman recently discussed server spending with a major OpenAI investor without inviting Friar, even though she had attended prior meetings on the same topic. One attendee said her absence was "noticeable and awkward." Another source reported that Friar was also not invited to a high-level executive meeting involving major financial decisions earlier this year. Sky-High Compute Commitments Hide Financial Risks OpenAI’s current planned compute spend is unprecedented. Signed server rental contracts now total about $665 billion, covering: Oracle (about $300 billion, five-year term starting in 2027); Microsoft ($250 billion, until 2032); Amazon Web Services (about $138 billion, eight-year term); CoreWeave ($22 billion, five-year term); Cerebras ($10 billion), and several other partners. These commitments are not typical cloud computing contracts. Friar has explained that building an AI data center takes years, so OpenAI must book capacity far in advance. "I have to make decisions today to ensure we have enough compute in 2028, 2029, and even 2030. If I don’t place orders now, the data centers won’t exist." In one case, according to The Information, OpenAI and Oracle signed a risk-sharing agreement for data center construction overruns, a rare clause among cloud computing clients. OpenAI has now shelved its prior plan to build its own data centers. Double Pressure of Slowing Revenue and Cash Burn External competition is accelerating. Anthropic has surpassed OpenAI in selling AI models to enterprises and app developers, while Google Gemini continues to erode ChatGPT’s dominance in the consumer chatbot market. OpenAI has raised its five-year revenue outlook by 27% this year, but has privately told investors its cash burn through 2030 will double the estimate from last summer. The company also told investors that last year’s gross margin was lower than expected, because user demand exceeded forecasts and they had to purchase compute at higher spot prices. Anthropic co-founder and CEO Dario Amodei spoke in February on the Dwarkesh Patel podcast about the dangers of over-investing in data centers, implicitly referring to OpenAI: "If I misjudge, even by just a year… you go bankrupt. My impression is some companies have not actually done the math; they do not really understand the risk they're taking." This echoes Friar’s internal concerns. Someone who works closely with both described the CFO’s predicament: "She’s dealing with an ambitious founder who wants to go full throttle on spending. That’s a very tough job." Risk Warning and Disclaimer The market carries risk; investment needs caution. This article does not constitute personal investment advice, nor does it take into account the specific investment objectives, financial situation, or needs of individual users. Users should consider whether any opinions, views or conclusions in this article are suitable for their particular circumstances. Invest at your own risk.