ChatGPT maker OpenAI is reportedly valued at $500 billion following an employee share sale, but Deutsche Bank data suggests Europe’s enthusiasm for the chatbot may be plateauing.
It says European spending on ChatGPT has stalled since May, after rapid growth through 2023 and early 2024. This suggests that, while weekly user numbers continue to climb, from 500 million in March to more than 800 million today, the number willing to pay is levelling off.
That matters, says Deutsche’s Jim Reid, because OpenAI’s valuation already matches Netflix’s despite a far smaller revenue base.
Netflix, with about 300 million subscribers and roughly $45 billion in annual revenue, trades on a price-to-sales ratio of about 12.5. Spotify, which has 276 million subscribers and is valued at $144 billion with $17 billion in revenue, sits closer to 7.3.
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OpenAI’s implied multiple is far higher, reflecting expectations of monetisation that have yet to materialise. OpenAI had only 20 million paying subscribers in April. Converting its many users into paying customers “may ultimately tell us almost everything we need to know about the monetisation of AI”, says Reid.
AI “will change the world and improve productivity”, he says, but “the profitability outlook is more uncertain”.
