OpenAI Ad Business Hits $1 Billion Annualized Revenue, Expands to 40+ Countries Ahead of IPO

OpenAI announced on Monday that its advertising business has reached $1 billion in annualized revenue. The company said the milestone reflects the success of its "diversified business model." OpenAI is currently preparing for a large-scale initial public offering, with a valuation of $852 billion, and needs to demonstrate its value to investors. The advertising business, established about 200 days ago, builds on existing revenue engines such as enterprise services, consumer subscriptions, and usage-based application programming interfaces.

OpenAI began testing ads in its ChatGPT chatbot in the United States in February, a decision that drew significant attention and controversy. Digital advertising has long been a primary revenue source for major tech companies like Google and Meta, and OpenAI's advertising move was mocked by competitor Anthropic, which made it the theme of its first Super Bowl ad. ChatGPT ads are now live in more than 40 countries, and OpenAI announced on Monday the launch of self-serve access in India, Europe, the Middle East, and North Africa.

The ads appear for ChatGPT Go subscribers and free users, who make up the vast majority of its 1 billion weekly active users. OpenAI said the ads are clearly labeled, do not affect ChatGPT's responses, and that advertisers cannot access users' private conversations. The company said in a statement that the next phase of growth will expand ChatGPT ads to more markets and introduce additional ad formats, targeting, buying options, and measurement capabilities, while exploring ways for businesses to interact with consumers in a more native manner.