Online Desk : OpenAI has announced it will retain its nonprofit governance structure, reversing earlier plans to transition fully to a for-profit model.

CEO Sam Altman revealed the decision in a message to staff on Monday, citing feedback from civic leaders and ongoing discussions with the Attorneys General of California and Delaware.

Although the company’s nonprofit entity will remain in control, OpenAI is restructuring its for-profit arm into a public benefit corporation (PBC). This model requires companies to balance profit-making with broader social goals. Altman and OpenAI board chair Bret Taylor emphasized the change is part of a “recapitalization” effort aimed at enabling growth while maintaining the company’s founding mission.

Under the new structure, shareholders will receive stock, and profit caps for some early investors will be lifted. The nonprofit board will also appoint the PBC`s board members, many of whom are expected to remain the same during the transition. However, Taylor declined to specify the size of the nonprofit’s ownership stake in the restructured entity.

Altman explained that converting from a limited liability company to a PBC will create a more conventional corporate structure, better suited for scaling operations, raising capital, and pursuing acquisitions.

Founded as a nonprofit research lab nearly a decade ago, OpenAI’s mission has been to develop artificial general intelligence (AGI) for the benefit of humanity. Today, the organization’s flagship product, ChatGPT, has over 400 million weekly users, and OpenAI’s estimated market value has soared to $300 billion.

The company had faced significant hurdles in its push toward a more traditional for-profit model. These included a lawsuit from co-founder Elon Musk, who alleged that the organization strayed from its original mission. A federal judge recently dismissed some of Musk’s claims but allowed others to proceed to trial in 2026.

Regulatory scrutiny also played a role, with attorneys general in California and Delaware reviewing OpenAI’s governance plans. The California attorney general’s office confirmed the matter is ongoing.

Despite the structural changes, Altman said he still anticipates a major investment from Japanese tech conglomerate SoftBank, which earlier this year announced a joint venture with OpenAI focused on expanding AI services.