OpenAI's Wallet Just Got Heavier -- Because Meta's Been Poaching
The company known worldwide for ChatGPT has seen its stock-based compensation jump more than five times over the past year; that's not a typo. In total, OpenAI handed out $4.4 billion in equity; that figure was 119% of its entire revenue for the same period. Yes it's now literally paying out more in stock than it's earning.
Warning! GuruFocus has detected 6 Warning Sign with META.
And the trigger? Meta (META, Financials) which has reportedly lured away at least nine researchers from OpenAI's AI team including some working on foundational models. These exits weren't minor; they cut deep.
OpenAI had hoped this stock-based spending spree would cool off by 2025 projecting equity payouts to drop to 45% of revenue, and then under 10% by the end of the decade. But that was before Meta started raiding its brain trust.
Now, those assumptions are out the window. According to internal chatter, Chief Research Officer Mark Chen believes the company might have to sweeten its equity offers even more; because when your biggest assets walk out the door, the only thing left to do is open it wider with better incentives.
This isn't just about keeping salaries competitive; it's about survival. The AI space is getting fiercer by the week; and even with Microsoft in its corner, OpenAI can't afford to lose talent to rivals.
Equity compensation isn't a perk anymore; it's a weapon. And OpenAI is loading up.
This article first appeared on GuruFocus.
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