CNBC's MacKenzie Sigalos joins 'Squawk on the Street' to report on the latest news from OpenAI.

OpenAI has closed a $6.6 billion secondary share sale, raising its valuation to $500 billion and surpassing SpaceX as the most valuable private company globally. The sale enabled current and former employees with over two years of tenure to sell their shares, though a significant portion of the authorized $10.3 billion went unsold, which insiders interpret as a sign of employee confidence in the company's future.

Major investors in the round include Thrive Capital, SoftBank, Dragoneer, Abu Dhabi's MGX, and T. Rowe Price. OpenAI is also navigating a competitive talent market, with rivals offering substantial compensation to attract its researchers. The company is pursuing additional funding, contingent on a corporate restructure, and is expanding its monetization strategies, including new video generation tools and e-commerce initiatives.

OpenAI wraps $6.6 billion share sale at $500 billion valuation

As for OpenAI, we've mentioned that latest funding round sending its valuation soaring. Our Mackenzie Sagalos is in San Francisco watching that this morning. Hey, Mack. Hey, good morning, Carl. OpenAI informed investors on Wednesday that it's locked in its half a trillion dollar valuation. The company has officially closed a $6.6 billion secondary share sale. That makes it the most valuable private company in the world, now surpassing SpaceX. Now, this deal allowed current and former employees who have held stock for more than two years to cash out. But what's notable is a shortfall. While OpenAI had authorized up to $10.3 billion worth of shares, a significant portion went unsold. Now, in terms of who is buying those shares, the investor lineup includes Thrive Capital, SoftBank, Dragoneer, Abu Dhabi's MGX and T. Rowe Price. Internally, a source familiar with the tender says that the undersubscription is being framed as a sign of confidence. Many employees are choosing to hold their equity and outside investors are still eager to buy in at a valuation that has nearly doubled from $300 billion earlier this year. This is OpenAI's second major tender offer in less than a year, following a $1.5 billion deal with SoftBank in November, and it reflects a broader trend among AI leaders like Stripe and Databricks. They are using the secondary sales to reward employees and retain talent without going public. OpenAI is also facing rising pressure to hold on to their top researchers with rivals like Meta, reportedly offering nine-figure compensation packages to poach their top talent. Now, at the same time, OpenAI still has to close that $40 billion SoftBank-led primary round. Some of that funding has come in, but the bulk remains contingent on completing a corporate restructure by the end of the year. Guys? Mac, I know later on this morning, you're going to take a look at some of these new video generators that they've announced and sort of the questions that arise out of that about how we trust anything we see now in video form. Well, there is this video arms race. I mean, you've got players like Google and ByteDance already in the game, and there has been some blowback. I mean, the sophistication of Sora 2, that's the name of this latest iteration by OpenAI, is extremely impressive. I've talked to a lot of technologists who just say that this absolutely raises the bar from the product that was launched in February of last year, but Sam Altman, his response to the feedback that they, some of the blowback really about the deepfake-like videos that have been put out there, is that this is also a key piece of their monetization strategy, and that is huge for OpenAI. Just last week, they announced nearly a trillion dollars in fresh spending commitments, and he says that this is a piece of how they plan to pay for it. I mean, just Monday, OpenAI talked about a new e-commerce strategy. That's the first time that they've gotten into taking a cut from merchants, so it's really a big part of the strategy here for them. Look forward to talking more about that in the coming hours, Mac. Thank you. Mackenzie Segalos, OutWest.

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LaGuardia Airport

Two regional jets collide on tarmac at New York's LaGuardia Airport

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Manchester

Two killed in attack near synagogue in England

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Washington

White House says federal worker layoffs ‘imminent’ after shutdown

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Los Angeles

Jane Goodall, chimpanzee researcher and conservationist, dies at 91

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Doha

Trump signs executive order protecting Qatar after Israeli strike

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Jerusalem

Middle East Conflict

Israel continues Gaza offensive as Hamas weighs U.S. peace deal

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Odesa Oblast

Deadly flash floods hit Odesa after downpours in Ukraine's south

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Kabul

Afghanistan imposes internet blackout

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Cebu

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Quantico

Hegseth gathers U.S. military leaders for rare, in-person meeting

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Folly Beach

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Venezuelan President Nicolas Maduro said Monday he is ready to declare a state of emergency over the threat of U.S. "aggression," following a spate of deadly U.S. strikes on suspected Venezuelan drug boats.

Caracas

Maduro ready to declare state of emergency over U.S. 'aggression'

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Hollywood

Global Tariffs

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Chișinău

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Ukraine Invasion

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Grand Blanc

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Breakdown