Deepwater Asset Management's Gene Munster has presented a compelling argument that OpenAI's estimated $830 billion valuation is, in fact, an understatement. This perspective emerges despite the company's anticipated financial losses and prevailing concerns about market overvaluation. Munster emphasizes the exponential growth and extensive reach of OpenAI, alongside the unwavering commitment of major technology giants to artificial intelligence, as critical factors that eclipse financial drawbacks and fears of an economic bubble.
Insight into OpenAI's Valuation Dynamics
On December 20, 2025, Gene Munster, a prominent figure at Deepwater Asset Management, shared his views on social media, asserting that OpenAI's upcoming funding round, potentially valuing it at $830 billion, might still be a conservative estimate of its future capabilities. He remarked on the "mind-numbing reality of AI's potential," noting that the company's value has multiplied nearly 28 times in just four years, yet remains, in his judgment, undervalued.
Munster's analysis, further detailed in a blog post, references a Wall Street Journal report indicating OpenAI's ambition to secure approximately $100 billion in funding by March 2026, targeting an $830 billion post-money valuation. He contends that a strong argument supports this valuation, suggesting it could realistically double or triple in the coming years, defying widespread skepticism.
Addressing the criticisms, Munster acknowledged the company's dramatic valuation increase from roughly $30 billion in 2022 to the current projection, alongside internal forecasts predicting cumulative losses between $100 billion and $150 billion from 2025 to 2029. He also drew parallels to the dot-com bubble, recalling how early tech leaders like Netscape and Lycos faltered, and pointed to the intense competition for AI talent, with companies such as Meta Platforms, Alphabet's Google, and Microsoft aggressively recruiting top researchers.
Nevertheless, Munster maintains that the optimistic outlook warrants equal consideration. He highlighted that industry leaders, including Microsoft CEO Satya Nadella, Nvidia's Jensen Huang, Alphabet CEO Sundar Pichai, Meta's Mark Zuckerberg, and Tesla's Elon Musk, are making significant investments in AI. This collective commitment, involving tens of billions of dollars, signals a profound belief that the intrinsic value and impact of AI will ultimately transcend any speculative hype.
Munster further explained that OpenAI's impressive growth trajectory justifies its high valuation. He projected a revenue increase from about $4 billion in 2024 to $35 billion in 2026 and potentially $70 billion in 2027, far surpassing the growth rates of publicly traded tech companies. He also underscored OpenAI's extensive user base, estimating close to 900 million weekly active users for ChatGPT, which provides a distribution advantage comparable only to Google and Meta. He concluded that if OpenAI continues its 100% growth rate, an $830 billion valuation will eventually appear modest; otherwise, its value could diminish.
In related developments, Microsoft-backed OpenAI is reportedly preparing for a significant public offering. Reuters previously reported that the company might file with U.S. securities regulators as early as the second half of 2026, with estimates suggesting the IPO could value OpenAI at up to $1 trillion. OpenAI is also engaging in discussions with Amazon.com Inc. for a potential investment exceeding $10 billion, while also exploring the integration of Amazon's AI chips.
The financial world is witnessing a dramatic shift, propelled by the relentless advance of artificial intelligence. Gene Munster's analysis of OpenAI's valuation is a testament to the profound belief held by many in the industry regarding AI's future. It challenges conventional valuation models, urging a focus on long-term disruptive potential rather than short-term financial metrics. As AI continues to evolve, the narrative around companies like OpenAI will undoubtedly influence investment strategies and shape the technological landscape for decades to come.