OpenAI Faces Slowing ChatGPT Growth and Revenue Shortfalls

OpenAI failed to meet its internal goal of one billion weekly active ChatGPT users by the end of last year and also fell short of its revenue targets. CFO Sarah Friar warned that the company may be unable to honor future computing contracts unless it quickly increases earnings. The shortfall emerges amid rumors of an IPO later this year.

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The broader AI sector continues to invest tens of billions of dollars in infrastructure, yet a clear return on that spending remains distant. OpenAI’s primary revenue source—paid ChatGPT subscriptions—has stalled, while rival Anthropic’s Claude chatbot recorded a 1,000 % year-over-year increase in installs, far outpacing ChatGPT’s 14 % growth.

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• Sam Altman – CEO of OpenAI, who described the Pentagon contract as “opportunistic and sloppy.”

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• Sarah Friar – Chief Financial Officer, issuing the warning about future contract payments.

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• Anthropic – Competitor whose Claude chatbot is gaining market traction.

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• U.S. Department of Defense – Partner in a contentious contract that has affected user sentiment.

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• Uninstalls of the ChatGPT app rose 132 % YoY in April and 413 % YoY in March, the latter linked to the Pentagon contract.

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• Sensor Tower reports Claude installs up 1,000 % YoY versus ChatGPT’s 14 % YoY.

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• OpenAI plans a lower-priced “ChatGPT Go” tier at $8 per month, targeting 112 million users by year-end.

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• Plus subscribers, currently paying $20 per month, are projected to fall 80 % to nine million.

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• Total user base is expected to reach 122 million, aiming to double the subscriber count within the year.

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OpenAI is exploring ad-supported revenue streams and has announced the upcoming ChatGPT Go plan to broaden its subscriber base. The company acknowledges the steep growth targets and the need to offset declining full-tier subscriptions.

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Consumers now have the luxury of choosing from a wide variety of other options, including free ones — at least for now. The sharp rise in uninstalls and the competitive surge of Claude occur as the company faces rumors of an IPO later this year.

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The internal target of one billion weekly active users and the exact financial impact of the Pentagon contract are based on company disclosures and third-party analytics; independent verification is lacking. Additionally, the precise timeline for the ad-revenue model remains unspecified.

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> “opportunistic and sloppy,” — Sam Altman, CEO, OpenAI

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OpenAI’s IPO timeline remains uncertain as the company evaluates ad-based revenue and the upcoming ChatGPT Go tier. The subscriber growth goals are central to its upcoming strategic decisions, including the potential IPO.

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