OpenAI, the company behind ChatGPT, is working with Goldman Sachs and Morgan Stanley on plans for a potential stock market listing as soon as September, according to reports. Bankers from both firms are preparing a confidential IPO filing with regulators that could be submitted within days, the Wall Street Journal has reported.

Goldman Sachs and Morgan Stanley racing toward a potential September debut

According to the Wall Street Journal, OpenAI has enlisted two of Wall Street's most prominent investmet banks to shepherd it toward a public listing. The confidential filing could be submitted as soon as this week, with a September IPO theoretically possible if regulatory and market conditions align. However, sources caution that the timeline remains fluid and could shift based on unforeseen obstacles or market volatility.

The move marks a dramatic acceleration in OpenAI's path to the public markets. The company was valued at approximately $852 billion in its most recent funding round, making it one of the most valuable private companies in the world. A public listing at that valuation would rank among the largest IPOs in recent memory, rivaling the debuts of major tech and financial firms.

The $852 billion valuation versus unproven profitability model

OpenAI's astronomical valuation masks a fundamental challenge: the company has not demonstrated it can generate sufficient revenue to justify its massive spending on data centers and computing infrastructure, according to reporting on the IPO plans. The company has reportedly missed some internal targets for revenue and user growth in recent months, raising questions about whether current financial performance can support investor expectations at such a high price point.

This gap between valuation and profitability is not unique to OpenAI—many high-growth tech companies have gone public at premium valuations before proving sustainable business models. But for an AI company burning through billions in capital expenditure, the pressure to demonstrate a clear path to positive cash flow will be intense from institutional investors and underwriters alike.

Anthropic and Google intensifying the race for AI dominance

OpenAI's IPO push comes as competition in the generative AI sector is accelerating sharply. rival Anthropic, backed by Google and Amazon, is rapidly gaining ground with its Claude AI model, while Google itself is pushing ahead with its own suite of AI tools. The competitive landscape has shifted significantly since ChatGPT's debut in late 2022, when OpenAI held a near-monopoly on consumer-facing large language models.

This intensifying competition raises questions about OpenAI's ability to maintain market share and pricing power—both critical factors for a newly public company trying to justify its valuation to shareholders. As the report notes, the company faces "major challenges" before any listing, and competition is among the most visible of them.

Elon Musk's legal challenge and regulatory uncertainty ahead

OpenAI recently won a court battle with co-founder Elon Musk, who is expected to appeal the decision. the ongoing legal dispute adds a layer of uncertainty to the IPO timeline, as regulatory scrutiny of the company's governance and founding disputes could complicate the confidential fiing process or delay the public offering.

Beyond the Musk litigation, OpenAI will face broader regulatory questions about AI safety, data privacy, and market concentration. These issues are likely to feature prominently in SEC review of the IPO filing and could influence investor sentiment once the company goes public. The regulatory environment for AI companies remains in flux, and a high-profile IPO could invite additional scrutiny from lawmakers and regulators worldwide.