The $70 Billion OpenAI Number Wall Street Lent Against Is Now $50 Billion
OpenAI told investors annualized revenue is approaching $50 billion, not the roughly $70 billion the market had been using. The gap is mostly measurement; the debt stacked on the bigger number is real.
Vincent Jiang · 3 min read
A smaller OpenAI, priced in minutes
Thursday delivered the first hard cut to the revenue base under AI's debt stack. OpenAI$1.18T — OpenAI, private, latest valuation $1.18T told investors its annualized revenue was approaching $50 billion at the end of September 1, against the roughly $70 billion in circulation since late last month 2. Oracle−4.95% — Oracle, down 4.95 percent today fell 5.26% to $136.01 and is down nearly 30% this year 3; CoreWeave−7.46% — CoreWeave, down 7.46 percent today dropped 6.5% 4, Broadcom−3.91% — Broadcom, down 3.91 percent today 4.1% and Nvidia−2.67% — Nvidia, down 2.67 percent today 3% 5.
The $20 billion never vanished. The larger figure counted revenue shared with partners such as Microsoft−1.28% — Microsoft, down 1.28 percent today and Amazon−1.96% — Amazon, down 1.96 percent today, and investors had already grossed OpenAI up for comparability with Anthropic$350B — Anthropic, private, latest valuation $350B 21. Booked where it is earned, part of it was never OpenAI's.
Oracle is where the number lands
Oracle builds OpenAI's data centers, and its contract backlog stood at $664 billion last quarter 3. Capital spending hit $28.5 billion in the June-to-August quarter, more than twelve times the $2.3 billion of two years earlier 39. Total debt has climbed from $75.9 billion in fiscal 2022 to $169.1 billion by August, and Oracle now ranks as the fifth-largest borrower in the US corporate bond market 43.
Oracle's quarterly capex has grown more than twelvefold in two years
Data
| Capex | |
|---|---|
| Q4 '23 | $1.08B |
| Q1 '24 | $1.67B |
| Q2 '24 | $2.8B |
| Q3 '24 | $2.3B |
| Q4 '24 | $3.97B |
| Q1 '25 | $5.86B |
| Q2 '25 | $9.08B |
| Q3 '25 | $8.5B |
| Q4 '25 | $12.03B |
| Q1 '26 | $18.64B |
| Q2 '26 | $16.49B |
| Q3 '26 | $28.5B |
Fixed margin, rising costs
The squeeze is contractual, on SemiAnalysis founder Dylan Patel's telling: Oracle signed its big AI deals at essentially fixed margin, so the GPU-rental inflation rivals are capturing passes Oracle by 4. CoreWeave raised prices 25% in July and about 10% since; Nebius−6.44% — Nebius, down 6.44 percent today, holding the shortest contracts, repriced faster still 4. On Patel's read, the bill for that inflation sits with the long-contract clouds, Oracle and CoreWeave among them, while short-contract Nebius keeps the windfall 4.
Oracle's gross margin has slid from 79.1% in fiscal 2022 to 60% in the August quarter 49. It is trucking compressed natural gas to Project Jupiter in New Mexico to hold schedule 6, where about $18 billion of loans were quoted at 89 to 91 cents on the dollar and S&P keeps Oracle one notch above junk 11.
Oracle's gross margin has slid eleven points in under three years
Data
| Gross margin | |
|---|---|
| Q4 '23 | 71.1% |
| Q1 '24 | 70.9% |
| Q2 '24 | 72.5% |
| Q3 '24 | 70.6% |
| Q4 '24 | 70.9% |
| Q1 '25 | 70.3% |
| Q2 '25 | 70.2% |
| Q3 '25 | 67.3% |
| Q4 '25 | 66.5% |
| Q1 '26 | 64.6% |
| Q2 '26 | 65.2% |
| Q3 '26 | 60% |
The lock cuts both ways
If GPU prices fall, the short contracts that let Nebius reprice upward reprice downward, and Oracle's deals hold 4. The backlog is contracted money: obligations of $664 billion, up $209 billion in a year, with $75 billion of large AI contracts carrying customer prepayments or customer-supplied chips 11. Cloud infrastructure revenue grew 121% to $7.4 billion last quarter 11.
What the lenders price now
Apollo and Goldman Sachs−0.14% — Goldman Sachs, down 0.14 percent today are in talks to fund Oracle's next chips through a separate company it wants closed this year 3, and Broadcom is arranging more than $50 billion for OpenAI's custom silicon 110. OpenAI seeks $30 billion-plus at a reported $1.4 trillion, about 28 times its new revenue figure against 20 times the old 1.
JPMorgan's 41-stock AI basket now accounts for 49% of the S&P 500's market value 7. Self-reported OpenAI numbers are the collateral in this chain, and the week's other release shows the habit: ten of 719 math proofs came with the model's chain of thought, and outside mathematicians documented discrepancies between the prose proofs and the formal Lean code 8. Every lender in this chain is now underwriting a number OpenAI itself does not count.
Deepdive
AI-generated from this story and its cited sources. Not investment advice.
