OpenAI secures $4 billion credit line following massive funding round

In a move that further solidifies its position as a leader in the artificial intelligence industry, OpenAI has secured a $4 billion revolving credit line, just a day after closing a $6.6 billion funding round. The new financial boost, announced on Thursday, brings the company’s liquidity to a substantial $10 billion, positioning it for aggressive expansion and technological development in its ongoing competition with industry giants like Google and Microsoft.

The credit line, arranged with major financial institutions including JPMorgan Chase, Citi, Goldman Sachs, and others, is expected to provide OpenAI with the financial flexibility to acquire the computing resources it needs—particularly Nvidia chips, which are crucial for AI advancements. OpenAI’s finance chief, Sarah Friar, emphasized the importance of the new facility, stating that it “further strengthens our balance sheet and provides flexibility to seize future growth opportunities.”

The credit line was established with JPMorgan Chase, Citi, Goldman Sachs, Morgan Stanley, Santander, Wells Fargo, SMBC, UBS, and HSBC. 

Just this week, the company raised funds at a valuation nearing $157 billion from key investors such as Thrive Capital and Khosla Ventures, along with significant contributions from corporate partners Microsoft and Nvidia. This funding was issued in the form of convertible notes, contingent upon OpenAI’s transition to a fully for-profit structure and the lifting of the current cap on returns for investors.

While the startup is navigating significant internal changes—including the recent departure of longtime Chief Technology Officer Mira Murati—the enthusiasm among investors remains high. CEO Sam Altman’s ambitious projections suggest that OpenAI will generate $3.6 billion in revenue this year, with the expectation of more than tripling that figure to $11.6 billion in 2025. Although the company is facing mounting losses, which are expected to surpass $5 billion, the overall sentiment among stakeholders points toward substantial future growth.

In a unique arrangement, Thrive Capital has been offered the opportunity to invest an additional $1 billion next year at the same valuation if OpenAI hits its revenue targets, providing further incentives for ongoing financial backing.