This Week in AI: OpenAI, State Laws and Google Gemini

This week in AI saw mega-fundraising as well as states shifting their regulations to focus more on growth than risk mitigation. Meanwhile, financial service firms remain cautious on agentic AI as Google introduces its most power model yet: Gemini 2.5. Here’s what happened.

OpenAI Snags Record $40 Billion Funding Round

OpenAI is reportedly close to finalizing an all-time record funding round of $40 billion, according to Bloomberg News.

The round is being led by Japanese investment giant SoftBank and is the largest on record, according to data from Pitchbook. It would value OpenAI at $300 billion, double its last valuation from October 2024.

OpenAI recorded $3.7 billion in revenue for 2024 and expects top line to hit $12.7 billion in 2025 and $29.4 billion the following year.

But the artificial intelligence (AI) startup does not expect to be cash-flow positive until 2029, due to high costs of chips, data centers and hiring of skilled labor. OpenAI is projecting 2029 revenue of more than $125 billion.

SoftBank is set to invest $7.5 billion initially, along with $2.5 billion from an investor syndicate. A second tranche valued at $30 billion is coming later this year — $22.5 billion from SoftBank and $7.5 billion from a syndicate.

Other investors in talks to join the round are Magnetar Capital, Coatue Management, Founders Fund and Altimeter Capital Management.

Read more: OpenAI Reportedly Ready to Close Record $40 Billion Funding Round

SoftBank to Invest $1 Trillion in Robotic Factories

In other SoftBank news, the Japanese giant is reportedly planning to invest $1 trillion to build factories that employ AI-powered robots in the U.S.

The robots will address labor shortages plaguing American manufacturers, as reported by the Nikkei Asia newspaper in Japan.

The factories will be located in industrial parks across the country. This investment is double the $500 billion investment to build AI data centers that SoftBank CEO Masayoshi Son announced in January, along with OpenAI, Oracle and MGX. The project is dubbed Stargate.

See also: Report: SoftBank to Invest $1 Trillion in AI-Powered Robot Factories in U.S.

Financial Services Firms Stay Cautious on Agentic AI

Financial services companies are still in the early innings of deploying generative and agentic AI despite the rhetoric coming from AI vendors, industry executives and academics said in an SEC roundtable discussion.

The on-the-ground truth is that “a lot” of financial services companies are adopting technology at a “much slower rate” than that of tech companies developing and selling the technology, said Hardeep Walia, managing director and head of AI and personalization at Charles Schwab.

Sarah Hammer, executive director at the Wharton School, added that while generative AI is helpful, especially in inefficient processes like clearing and settlement, “companies are still thinking about value. … A lot of [firms] struggle to understand how to measure return on investment, because this is an incredibly expensive technology.”

Read more: AI Adoption in Finance: Promise vs Reality — SEC Roundtable Reveals Cautious Approach

AI Regulation in States Shifts to Pro-Growth

States regulating artificial intelligence seem to be pivoting toward a pro-innovation, pro-growth stance instead of the EU-style risk mitigation approach, according to think tank R Street Institute.

Year to date, state legislators have introduced more than 900 bills related to AI, which is a record pace, Adam Thierer, resident senior fellow of technology and innovation at R Street, wrote in an opinion piece.

Thierer pointed to Virginia and Texas as states rejecting the stricter norms of the EU AI Act.

This week, Virginia Gov. Glenn Youngkin vetoed HB 2094, dubbed the “High-Risk Artificial Intelligence Developer and Deployer Act.” He said the bill “would harm the creation of new jobs, the attraction of new business investment, and the availability of innovative technology.”

A week and a half earlier, Texas lawmakers unveiled a “significantly” revised version of the “Texas Responsible AI Governance Act.” The new version of HB 149 removes many of its more restrictive provisions in favor of a lighter regulatory touch, Thierer wrote.

Also read: AI Regulations in States Shift to Pro-Innovation, Not Risk Mitigation

Google Unveils Its Most Powerful AI Model Yet

Google has introduced Gemini 2.5, its most powerful generative AI model yet.

Gemini 2.5 opens a new front in the competitive AI race as it performs mostly head-and-shoulders above its staunchest rivals in industry benchmarks.

The latest from Google’s family of generative AI models with the same name, Gemini 2.5 is Google’s “most intelligent” model and outperforms top-of-the-line models from OpenAI, Anthropic, Grok and DeepSeek “by a significant margin,” Google DeepMind Chief Technology Officer Koray Kavukcuoglu wrote in a blog post.

That means enterprises deploying generative AI models can tap a more powerful tool in the Google Cloud arsenal to build their custom apps.

Anders Indset, founder of investment firm Njordis, told PYMNTS the Gemini 2.5 model is “a masterpiece of reasoning, multimodality and raw computational might,” and said Google is “thrusting itself into an AI race that’s no longer a sprint but a relentless, winner-take-all siege.”

Read more: Google Debuts Touted Gemini 2.5 in the ‘Winner-Take-All’ AI Model Race

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