Reports that OpenAI missed some key goals dealt a huge blow to the tech industry on Tuesday.
The ChatGPT maker fueled a big risk-off move, with investors dumping tech stocks as they digested a Wall Street Journal report that OpenAI missed its 2025 revenue and other key targets.
Other metrics that Sam Altman’s company missed include new user growth goals and a goal of reaching 1 billion weekly active users by the end of the year, the report said.
The news, announced ahead of OpenAI’s long-awaited IPO, casts further doubt on AI trading at a time when investors were already concerned about high valuations and whether the billions spent on data centers were worth it in terms of return on investment.
Here are the U.S. indices as of the 4pm ET closing bell:
In an email to Business Insider, OpenAI called the magazine’s report “clickbait.”
“The business is in full swing,” the company said, adding that its enterprise business is “in the best shape it’s ever been” with a recent deal with Microsoft and the continued “surge” of Codex, OpenAI’s coding tool.
SoftBank, Oracle, and CoreWeave are among the list of companies that have signed large contracts with OpenAI, and some of the companies that have suffered some of the heaviest losses.
The most notable developments in the technology sector include:
The decline comes in a crucial week for tech company profits. Alphabet, Amazon, Apple, Meta and Microsoft will report their first quarter results after the close of trading on Wednesday and Thursday.
Wedbush Securities analyst Dan Ives, known for his perpetual bullish stance on technology, said investor concerns that OpenAI is losing market share to competitors are contributing to the decline. He said he views the decline as a buying opportunity as demand from consumers and businesses is likely to remain strong.
“We believe recent concerns about OpenAI are overstated as the company has sufficient capital to meet its computing power needs for at least the next three years,” Ives wrote in a customer note.
“There was some pushback this morning from some people that the article lacked many numerical data points on the revenue side and correlated with the large increase in Codex usage in recent weeks,” Jeffrey Fabza, a strategist at Jefferies, wrote about the market’s reaction to the report.
Meanwhile, concerns about the economic impact of the Iran war remain in the market.
President Donald Trump is reportedly unhappy with Iran’s latest peace proposal, which has caused oil prices to rise again.
Brent crude oil, the international benchmark, rose more than 3% to over $111 per barrel. West Texas Intermediate crude also rose 3%, trading around $100.
The president followed up with a post on Truth Social on Tuesday morning saying Iran had told the US it was in a “state of collapse”, causing market turmoil.
“They want us to ‘open the Strait of Hormuz’ as soon as possible (and I believe we can!) as they try to figure out their leadership situation,” Trump wrote.
“The oil market is hoping for the best but preparing for the worst,” Alex Kupczykevich, chief market analyst at FXPro, said of Tuesday’s market reaction.