Not yet listed but stirring up the stock market: OpenAI has become a "hidden giant" in the US stock market
Although it has not yet gone public, OpenAI, with a valuation of $500 billion, is influencing global stock markets at an astonishing pace. Last week, the new "instant purchase" feature of ChatGPT caused the stock prices of Shopify and Etsy to soar, while an internal blog post triggered a broad decline in software stocks. On Monday, the company reached a potential multi-billion dollar cooperation with AMD, driving AMD's stock price up 38%, marking its largest increase in nearly a decade. Analysts say that OpenAI has become the "invisible giant" of the market, with its announcements and developer conferences capable of affecting stock prices across various industries
Although OpenAI is not publicly listed, media analysis suggests that this globally highest-valued startup is increasingly impacting the stock market.
Last week, OpenAI launched the "instant purchase" feature in ChatGPT, causing the stock prices of e-commerce companies Shopify and Etsy to soar. Subsequently, the company published a blog introducing new internal features, which triggered a new round of turbulence in document software stocks, with companies like Atlassian, previously pressured by concerns over AI impacts, declining again.
On Monday, OpenAI signed an agreement with AMD, a deal expected to bring AMD hundreds of billions of dollars in new revenue. Stimulated by this news, AMD's stock price surged by 38% at one point, marking the largest single-day increase since April 2016, and causing ripples across the entire chip industry, with Nvidia and Broadcom both seeing their stock prices drop.
Analysts believe that this kind of market-moving influence typically belongs only to giants like Apple or Nvidia, but now, although OpenAI remains a private company, it has begun to sway the stock prices of multiple publicly listed companies. The outside world generally believes that this startup, valued at $500 billion, has no plans to go public in the short term, making any announcements and activities, such as the annual developer conference held in San Francisco this Monday, a focal point for investors.
UBS analyst Karl Keirstead pointed out:
“Software and internet investors are closely watching OpenAI's next moves and the potentially disruptive impacts it may bring.”
“As OpenAI continues to expand, the market generally believes that the company must more actively seek new business growth points beyond ChatGPT subscriptions.”
Investors are expected to look for these clues at OpenAI's third DevDay. Media believe that the conference may again trigger stock market fluctuations, with partner and infrastructure supplier stock prices potentially benefiting, while companies whose businesses are encroached upon by OpenAI may see declines.
In a research report dated October 1, Keirstead wrote that OpenAI is expected to launch more consumer-grade AI agents, which may include "a more powerful travel booking assistant," and could potentially release an AI browser.
Tim Ghriskey, a senior portfolio strategist at Ingalls & Snyder, stated:
“While we cannot directly invest in OpenAI, this event is still important. Any information about its new products or plans helps investors reassess the market landscape. Perhaps we will find that some companies considered risky are not as dangerous as thought, or gain insights into the next wave of AI investment opportunities.”
Concerns about AI disruption are becoming reality
Since the launch of ChatGPT at the end of 2022, which ignited the AI craze, OpenAI has been the focus of the market. The subsequent race for computing power has driven up the stock prices of chip and cloud computing companies like Nvidia and Oracle. However, past concerns about AI disruption were largely theoretical; now this impact is becoming real.
OpenAI is seeking to leverage its ChatGPT platform with over 700 million users to explore new profit models. Currently, the company's operating costs far exceed subscription revenues. According to media reports, OpenAI is expected to generate $4.3 billion in revenue in the first half of 2025 but will still incur a loss of $2.5 billion OpenAI has also developed multiple AI tools internally to simplify research, make contract documents searchable, provide personalized responses for sales leads, and assist customer support. Chief Business Officer Giancarlo Lionetti disclosed this in a blog post published on September 29.
The article triggered a sharp decline in software stocks such as Klaviyo, DocuSign, HubSpot, Atlassian, and ZoomInfo, all of which fell more than 9% last week. Goldman Sachs' software as a service (SaaS) stock basket index also recorded its largest weekly decline in two months, dropping 3.3%.
However, some believe that the market's reaction to the threat posed by OpenAI has been exaggerated. Last week, OpenAI launched a social application that can generate and share AI videos, but social media stocks did not experience similar volatility. Meta's stock performed poorly last week, while Snap rose over 3%.
Bank of America analyst Brad Sills' team wrote in a report on October 2:
"Although software companies face potential threats from AI technology, the negative reaction in stock prices seems disconnected from the fundamentals."
Nevertheless, Zacks Investment Research senior strategist Kevin Cook believes that as OpenAI continues to expand, even as a private company, its influence in the stock market will grow stronger.
Cook stated:
"In the future, people will view OpenAI as one of the most influential companies driving the AI revolution. It is indeed rare for a private company to have such a significant ripple effect on the market. OpenAI operates more flexibly and creatively, which is why it creates a 'domino effect' on other companies—bringing both positive impacts and shocks."
