OpenAI’s Chief Financial Officer Sarah Friar said Wednesday that while the company has smashed through revenue milestones, it remains under mounting strain from the spiraling costs of artificial intelligence compute.
“It is voracious right now for GPUs and for compute,” Friar told CNBC’s Squawk Box. “The biggest thing we face is being constantly under compute. That’s why we launched Stargate. That’s why we’re doing the bigger builds.”
Friar explained that to mitigate those demands, OpenAI has been diversifying partnerships across providers, including Oracle and CoreWeave, while maintaining its close reliance on Microsoft.
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“Microsoft will be an important partner for years to come, and I think we are very intertwined because of our IP. Remember, Microsoft AI products are built on OpenAI technology,” she said.
The company’s growth has been staggering since the launch of ChatGPT in late 2022. This year alone, OpenAI is expected to triple revenue to $12.7 billion, according to people familiar with the matter. The company said it recently crossed $10 billion in annual recurring revenue, marking a dramatic surge for a firm that was largely unknown to the public just three years ago. In July, OpenAI hit its first-ever $1 billion revenue month.
That growth trajectory shows little sign of slowing. CEO Sam Altman said last week that OpenAI is preparing to spend trillions of dollars on new data centers to keep up with demand.
“Our bet is, our demand is going to keep growing, our training needs are going to keep going, and we will spend maybe more aggressively than any company who’s ever spent on anything ahead of progress,” Altman said.
Earlier this month, CNBC confirmed that OpenAI was in talks to sell about $6 billion in stock at a roughly $500 billion valuation. That follows a $40 billion funding round in March at a $300 billion valuation—the largest raise by a private technology company on record.
OpenAI is also riding the momentum of its latest release, ChatGPT-5, its most advanced AI model, which debuted to mixed reviews. While enterprise and developer clients praised the model’s improved reasoning capabilities—workloads spiked eightfold—some users complained about losing access to earlier models. The company quickly reinstated them for paid subscribers.
Friar acknowledged the tensions that come with scale. “When you have 700 million weekly active users, you start to find people are very opinionated,” she said, adding that OpenAI has nonetheless seen an acceleration in its Plus and Pro subscription tiers since the rollout.
But behind the headline numbers, questions linger over whether the company can maintain its breakneck expansion while contending with compute costs that are ballooning faster than its revenue base. Analysts note that while $10 billion in annual recurring revenue is a milestone for any private tech company, OpenAI’s reliance on GPU-intensive workloads means its operating expenses are unusually high.
Some analysts believe the economics of AI are unlike anything seen before. It is believed that the marginal cost of delivering new capabilities remains tied to scarce compute, and if Altman is serious about spending trillions on infrastructure, then OpenAI’s fundraising will have to scale at unprecedented levels.
Even with the expected $6 billion secondary stock sale, the gap between incoming capital and anticipated spending is stark. Investors have so far tolerated these imbalances given OpenAI’s growth trajectory and dominant market position, but the path to profitability remains unclear.
OpenAI’s deep integration with Microsoft—whose Azure platform powers much of its infrastructure—provides some insulation, but analysts caution that the company could become locked in a perpetual cycle of raising capital simply to keep pace with demand. The planned Stargate supercomputer project, described as one of the largest in the world, underscores both the ambition and the financial burden.
The company’s valuation now places it among the most valuable private tech firms globally, yet unlike software giants that operate at high margins, OpenAI is battling unit economics defined by hardware scarcity. For many, this raises the question of whether its long-term sustainability depends on either a breakthrough in compute efficiency or even deeper ties with strategic partners like Microsoft.
Altman and Friar, however, appear to be betting that revenue growth and aggressive expansion will outpace the spiraling costs. With more than 700 million weekly active users and subscription uptake accelerating, OpenAI is still riding a wave of momentum that few tech companies in history have experienced.