Tech Brew Ride Home - OpenAI To Delay Its IPO?

Episode Date: June 26, 2026

OpenAI leaned toward delaying its IPO to 2027 rather than budge from Altman's $1T valuation, rattling tech stocks. The government had OpenAI stagger GPT-5.6's release over security concerns. Microsoft hiked Xbox prices again, and SpaceX teased a Starlink mobile network. Sources: OpenAI leans toward holding off its IPO until 2027 after warnings that Sam Altman's desired $1T valuation may not be met in current market conditions (The New York Times) Sources: Sam Altman told staff the US government asked OpenAI to stagger the release of GPT-5.6 over security concerns, approving "access customer by customer" (The Information) Microsoft says the price of Xbox consoles will increase on August 1 by $100 for 512GB models and $150 for 1TB models, the third price increase since 2025 (Kotaku) Sources: SpaceX COO Gwynne Shotwell told investors during an IPO roadshow SpaceX may launch a Starlink mobile product and build its own terrestrial US network (FT) Longreads How Chicago is betting on quantum computing, including turning the site of its former US Steel mill into a campus, after largely missing the digital revolution (WSJ) As China's working-age population shrinks, consensus is growing that China must embed embodied AI robots into as many tasks as possible, as soon as possible (FT) Subscribe to the ad-free feed. Learn more about your ad choices. Visit megaphone.fm/adchoices

Welcome to the TechBrew ride home for Friday, June 26, 2026. I'm Brian McCullough today. Our tech stocks crashing because Open AI is leaning towards delaying its IPO. The government had OpenAI staggered GPD 5.6's release. Microsoft hype Xbox prices again. SpaceX teased a Starlink mobile network. And of course, the week on Longery Suggestions. Here's what you miss today in the world of tech. I'm at the age where I might pull a muscle just by thinking about stretching.

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After you purchase, they will ask you where you heard about them, so please show support for our show and tell them our show sent you. There's been another hiccup in tech stocks, for example, shares of Japanese NAND flashmaker, Zosha, slid 12% on Friday alone. Why? Well, folks are blaming this headline, quoting the times. Open AI is leaning toward holding off its initial public offering and next year, three people involved in the company's deliberation said, a turnabout that punctuates the uncertain future for fast-growing artificial intelligence giants. The maker of Chad GPT hired bankers and lawyers with an eye toward a public offering

as soon as the third or fourth quarter of this year, the people said. Sam Altman, the company's chief executive, pushed those advisors to find a way for the startup to be valued at $1 trillion up from the company's last private valuation of $730 billion, according to the people involved who did not want to be named because they were not permitted to speak publicly about internal deliberations. But a cascade of recent developments has caused opening eyes executives to shift away from their most aggressive aspirations. Top of mind is what happened to Elon Musk's SpaceX after its IPO this month. It was the largest ever raising more than $85 billion in reaching a valuation of $1.77 trillion on its debut. Since then, SpaceX's stock

has been on a downward slide as shares slumped to $153 at the end of the trading day on Thursday after reaching a high of $202 last week. Global markets have also been choppy in recent weeks with tech stocks dragging down indexes as investors question whether AI companies will live up to their sky high promises. That has caused OpenAI's advisors in conversations with the company over the past week to caution that it may not find much enthusiasm from retail investors for its own shares, two of the people involved said. OpenAI's tapping the bankers on its IPO plans could disappoint Wall Street and Silicon Valley. Public offerings from OpenA. Open A.I. and its rival Anthropic, which also said it was making plans for a Wall Street debut,

could unleash a wave of generational wealth. Opening A.I. said this month that it had filed confidential paperwork with securities regulators to kick off the process for going public, but it did not commit publicly to any time frame. Open Ayes' advisors presented company executives with the option awaiting until 2027 to go public with a $1 trillion valuation or lower the target evaluation for a quicker IPO. Mr. Altman said one person in contact with him on the topic. responded that any change to the trillion-dollar valuation was a non-starter. OpenAI is also grappling with other issues. Late last year, Sarah Fryer, the company's chief financial officer, said it was not pursuing an IPO at the time and was focusing on shoring up its finances. Since then, it has continued

to pour money into data centers and computing power with no indications of slowing down. The company is also spending heavily on marketing and recruiting high-profile engineering talent from companies like Meta and Google. It is searching for other lines of revenue, including dabbling with placing ads inside ChatCHIPT and striking e-commerce deals with companies like Shopify and Stripe that would allow people to buy things from online stores directly inside ChatchipT. Those initiatives are still in early experimental phases to OpenAI employees said. OpenAI reported roughly $13 billion in revenue in 2025. One of the people said a number of the company hopes to triple this year.

OpenAI said this year that it was generating $2 billion in revenue each month. But some OpenAI executives appeared to have changed their minds about an IPO just a few months after Ms. Fryer said the company was not looking to go public. The Wall Street Journal reported that the company planned to go public by the end of 2026. That surprised some employees because they thought the company was not on a strong enough financial footing to people familiar with the company's plans said, end quote. Sam Altman has reportedly told staff, the U.S. government asked OpenAI to stagger the release of GPT 5.6 over security concerns approving access customer by customer only, quoting the information. The company's biggest rival

Anthropic followed a similar course in April with Mythos, a new model with powerful cybersecurity capabilities that it shared with select partners rather than opening it up to the public. The reason for the staggered release, Altman explained, the federal government asked it to do so. Altman said that this was the best path for widely releasing the model as soon as possible, said one of the people. In a Thursday memo, Altman told staff that the government would be approving access customer by customer during this preview period for ChatGPT 5.6. He added that he hoped that he hoped to there would be a more general release a couple of weeks later if all went well. OpenAI staffers had been working closely with the government and various government agencies over the past month to preview

its latest model, including when Altman was in Washington, D.C. in early June, according to the person familiar with the matter. The request to do a staggered release came from conversations with two key government agencies, the Office of National Cyber Director, and Office of Science and Technology Policy. Even so, after OpenAI had shared its plans for the limited release, least with top government officials earlier this week. Altman still received a call from Commerce Secretary Howard Lutnik, cautioning the company against launching without receiving approvals from other agencies, according to a person familiar with the call. We've made clear to the U.S. government that this is not our preferred long-term model and will work with them and others in industry to achieve

a more sustainable approach for future releases, Altman said in the Thursday memo. The White House's anthropic actions have raised fears among policy and AI industry leaders that the government has created a de facto licensing regime for new frontier models while it continues to work out the specifics of the executive orders framework. After all, just how voluntary will its new AI system be if the administration can also force models off the market when it has concerns about them as it did with Anthropic. Arbitrary unknown, non-transparent license requirements are far worse than red tape, wrote Neil Chilson, the head of AI policy at the Think Tank Abundance Institute on X after the Trump administration's export control, end quote.

Expect this to continue to cascade everywhere in electronics, quoting Kataku. Every time we have to write that a console's price is increasing, it feels like this has got to be the last time, right? Well, no, actually. Xbox has announced that it's increasing the price of the Xbox consoles for a third time by $100 for the cheaper models and $150 for the largest, and it is also sunseting the 2-terabyte model. In the Xbox Wirepost, Microsoft cites the increase in prices for console storage and memory,

which have increased 2.5x since the last price increase in October, and the company expects it to double once more in the fall of 2027. The entire consumer electronics industry is struggling with the current components crisis, but the effects are particularly hard on consoles. Unlike phones, computers, speakers, and other consumer devices, consoles are typically not sold at a profit, but instead for less than they cost to make. because of the price increase. Xbox is announcing a new buy-now pay-later service that will allow people to buy Xbox systems through its own stores and break-up payments in interest-free installments. Amazon is also offering up to 12-month financing with flexible monthly payments. The company also says it's working with retailers to sell pre-owned systems as well as certified refurbished systems on the Microsoft store.

This is the third time Xbox systems have increased in price since 2025. with the first instance being in May of last year, with many speculating that President Trump's then newly imposed tariffs were at the heart of that decision. The second time was in September of that same year, with Microsoft citing changes in the macroeconomic environment for the move. This increase made the two-terabyte model a whopping $800, but now that model has been discontinued, end quote. Customers don't think in channels and support teams shouldn't either. That's why Twilio helps businesses unify voice messaging chat. and other channels into one continuous conversation so customers can move from AI self-service to a human agent without repeating themselves 15 times.

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Learn more at Twilio.com slash TB2. That's Twilio.com slash TB2. AI in real life. The future of AI isn't just digital. It's physical. From robots and drones to cars, industrial equipment, and medical devices, intelligent machines can transform our lives. But every intelligent device needs an efficient brain, one that can reason locally without cloud inference delays and without

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The move would require Starlink to build a new retail offering by selling mobile contracts to individual customers, competing directly with the three big U.S. network operators, Verizon Wireless, AT&T, and T-Mobile. To date, SpaceX has offered more limited direct-to-consumer services in the U.S., preferring to give telecoms groups such as T-Mobile access to its satellites to supplement their existing network coverage in rural areas. Although the terms of Starlink's commercial deals are not disclosed, analysts believe it takes a cut from revenues generated by those customers, who's mobile deals include access to its satellites. SpaceX's move into retail contracts would be one of the company's most significant commercial expansions since launching Starlink, which already operates across more than 150 countries worldwide, offering high-speed internet connections through its constellation of satellites. A direct-to-consumer mobile offering would give SpaceX access to a far larger market than satellite broadband alone, potentially reducing its reliance on telecom's

partners that currently act as intermediaries between Starlink's satellites and end users. While describing expanding Starlink as a key growth pillar in its IPO prospectus, SpaceX has never publicly confirmed that it plans to launch a retail mobile service. There has been months of speculation over SpaceX's future mobile plans after it paid $17 billion to rival Echo Star for wireless spectrum licenses to bolster its Starlink satellite network last September. Many analysts viewed the deal as laying the groundwork for an eventual retail offering. In its bond offering prospectus seen by the FT, SpaceX said that while it experienced, the Starlink Mobile Service currently to be most impactful for customers in remote areas

uncovered by terrestrial mobile networks, its longer-term ambitions appeared broader. As its performance improved, the satellite constellation grows, the prospectus suggests the company would compete to be the preferred connectivity experience to our customers, no matter where they are, whether in rural, suburban, or urban areas. The launch of a Consumer Starlink Mobile Retail Service would also complement the company's existing broadband internet option, which serves 10.3 million customers worldwide as of March. However, the plans have been met with trepidation by analysts who have cautioned that the idea may simply be a gamble to extract better deals from Starlink's telecom's partners and warned

of the billions of dollars in build costs and radio wave spectrum needed to roll out mobile networks. New Street research estimates that the three U.S. mobile network operators have a total of about 1,020 megahertz of spectrum while SpaceX has just 65 megahertz. David Barden, partner at New Street Research, said that building a wireless network in saturated markets around the world would be incredibly hard. But as a starting point for negotiating the best possible revenue-sharing deal with mobile network operator partners, it makes tremendous sense, he added, end quote. In the long reads this weekend, The Journal takes a look at how Chicago is betting on quantum

computing, including turning the site of its former U.S. steel mill into a quantum computing campus. The Chicago area largely missed the digital revolution that brought prosperity at Silicon Valley, Seattle, and other regions, but it has an advantage in this new field of computing owing to its longtime quantum physics and engineering prowess at the University of Chicago, the University of Illinois at Urbana-Champaign, Argonne National Laboratory, and Fermi Lab. The park is a bet that the city can leapfrog to the next tech era. Right now, we export a huge number of scientists and engineers to the coast. Harley Johnson, a University of Illinois at Urbana-Champaign,

engineering professor and chief executive officer of the project, said from the construction site this month, the park aims to create an industry that retains all that talent, he added. Illinois Governor J.B. Pritzker, who first proposed the park and marshaled $500 million in state funding for it, said he is hoping it. can help jumpstart Illinois's economic growth, which has lagged behind the nations. We need to do more than just attract manufacturing and build out agriculture in our state, Pritzker said in an interview.

We need to be in industries that are growing much faster than that, and now we are. The park has been in the works for several years, and construction has moved quickly since a groundbreaking this past fall. Illinois is racing to establish the site as the nation's quantum flagship as cities, including Boulder, Colorado, also vie for prominence. One nearly complete building will house one of the world's biggest quantum computers developed by Cy Quantum after parts begin arriving this summer. International business machines plans to install its own quantum computer at the site, one of more than a dozen. It runs worldwide alongside a research team and a consulting business that it said would employ 750 people by 2030, end quote.

And from the FT, as China's working age population shrinks, consensus is growing inside that country that China must embed embodied AI robots, into as many tasks as possible and as soon as possible. Quote, China's demographic structure is shifting and the population is gradually shrinking. That is an undeniable reality, says Huang Tai, Deputy General Manager of Sani Truck Manufacturing, which is based in the Hunan province. For labor-intensive industries, we believe replacing humans with robots is inevitable. The demographic change to which he refers, set to be one of the fastest in an aging world,

is China's biggest economic headwind. The country's working-age population aged 15 to 64, which peaked at $1 billion in the last decade, is due to fall to just $300 million by the year 2100, according to UN figures, a decline that could prevent China from becoming the world's biggest economy. Beijing now sees AI-enabled machines as a way out of the demographic trap. Last year, the country installed more industrial robots than the rest of the world put together. It also makes most of the world's humanoid. From Communist Party leaders in Beijing to business owners across China,

there is a growing consensus that the country needs to embrace embodied artificial intelligence, as AI-controlled robots are known, into as many tasks as possible and as soon as possible. We have not seen a transformation of this speed and scale since the Industrial Revolution, says Yuan Zhang, principal economist of the China Center at the conference board, whether it is intricate industrial processes such as factory quality control or elite service industry jobs, such as preparing Michelin-Star-level meals, all are under scrutiny for automation. President Xi Jinping has consistently championed the robot revolution declaring in 2014, just two years after taking power, not only do we need to upgrade our robots,

we need to capture markets in many places. The Communist Party's latest five-year plan calls for new forms of work involving human-machine collaboration and embodied intelligence in posts with labor shortages, high-risk environments, and other conditions, end quote. No weekend bonus episodes for you. Talk you on Monday.