OpenAI could generate $25 billion in annual ad revenue by 2030, and that should worry Google, top tech analyst says

A leading tech analyst has projected that OpenAI could amass an impressive $25 billion in annual advertising revenue by 2030, potentially disrupting Google’s dominance in the sector. According to Mark Mahaney from Evercore ISI, the company's success in launching its advertising initiatives could pave the way for this significant revenue stream. OpenAI recently announced that users of both free and paid versions of ChatGPT will soon start encountering ads, marking a pivotal shift in its business model. The firm has also outlined its advertising principles, emphasizing transparency by clearly labeling ads and ensuring that user conversations remain confidential. Mahaney estimates that OpenAI could generate several billion dollars from ads by 2026, eventually reaching over $25 billion by 2030. This forecast is based on the anticipated growth of ChatGPT's user base, the effective monetization strategies of performance marketing platforms, and the substantial size of the advertising market. Currently, OpenAI is experiencing rapid growth in revenue, with CFO Sarah Friar reporting an annualized revenue surge to $20 billion in 2025, a leap from $2 billion in 2023. However, questions linger about the company's profitability and how it will manage its operational losses moving forward. Advertising could serve as a crucial avenue for bolstering both revenue and profit margins. In comparison, Google's advertising revenue from its Search and YouTube platforms reached nearly $300 billion in 2025, while Meta accounted for an additional $180 billion. Both companies enjoy high profit margins, making their ad operations particularly lucrative. With ChatGPT attracting nearly 1 billion weekly users, the potential for advertisers to tap into a wealth of consumer insights is enticing. Users often share their preferences and needs with the AI, creating a valuable resource for targeted advertising. Mahaney points out that initial ads will be integrated into ChatGPT responses, designed to be relevant and minimally intrusive, which could appeal to both users and advertisers alike. OpenAI's strategy represents a direct challenge to Google's traditional revenue streams, offering an innovative and engaging platform for users to discover products and services. Mahaney emphasizes that if OpenAI can develop a conversational ad format, it could significantly shift marketing budgets as advertisers pursue high-intent engagement. Despite these ambitious plans, Mahaney cautions that OpenAI is unlikely to instantly capture Google's market share. The tech ecosystem that Google has developed over the years, including its popular Chrome browser, and the ingrained behavior of users to search for information via Google, will pose ongoing challenges for OpenAI as it seeks to carve out its place in the digital advertising space.