OpenAI is in talks for a new funding round that could potentially reach up to $40 billion, which would significantly increase its valuation to an estimated $340 billion.

OpenAI, the artificial intelligence company, is reportedly in talks with investors for a new funding round that could raise up to $40bn, valuing the company at $340bn, according to media reports.

SoftBank founder Masayoshi Son is set to lead the financing, which is expected to be worth between $15bn and $25bn, surpassing Microsoft as the biggest investor in OpenAI, according to people familiar with the matter.

Some of the funding could be used to fulfil OpenAI's commitment to the Stargate project, a joint AI infrastructure plan by SoftBank, OpenAI and Oracle that was announced last week by former US president Donald Trump. The project is expected to invest billions of dollars in AI infrastructure in the US.

OpenAI's latest valuation is $157bn. Since launching ChatGPT at the end of 2022, the company has ignited a wave of interest in generative AI. Last October, it completed a $6.6bn funding round aimed at competing with Elon Musk's xAI, Microsoft, Google, Amazon and Anthropic.

Meanwhile, DeepSeek, a Chinese AI start-up, is making a splash in the US market and could emerge as a rival to OpenAI. Its app topped the Apple App Store charts this week and has attracted attention for its AI model training costs, which are much lower than those of US competitors.

Speaking at an OpenAI event in Washington, DC, OpenAI chief executive Sam Altman said of DeepSeek: “It's obviously a very strong model.” He added: “It's a reminder that the competition is very, very intense.” He also stressed that it reflected the market's interest in reasoning capabilities and open-source AI.