OpenAI is poised to transform its free tier of ChatGPT into a major advertising platform, with top tech analyst Mark Mahaney of Evercore ISI estimating the business could generate over $25 billion in annual ad revenue by 2030. The projection comes as OpenAI announced on Friday that it will begin testing ads for free and Plus users of ChatGPT in the coming weeks. Mahaney’s forecast is based on ChatGPT’s massive user base—nearly 1 billion weekly active users—and the high commercial intent embedded in user interactions. Unlike traditional search, where users type queries, ChatGPT users often share detailed information about their needs, preferences, and goals, creating a rich data stream that advertisers find highly valuable. OpenAI has laid out clear advertising principles, including clearly labeling ads and ensuring user conversations are not shared with advertisers. Initial test ads will appear at the bottom of ChatGPT responses and will be contextually relevant to the ongoing conversation—aiming to be helpful rather than disruptive. Mahaney believes this approach could unlock billions in ad revenue as early as 2026, growing to $25 billion or more by 2030. He notes that Google’s Search and YouTube platforms generated close to $300 billion in ad revenue in 2025, while Meta brought in around $180 billion, both with operating margins near 40%. OpenAI’s ad business, while starting from a smaller base, could tap into similar high-intent user behavior. The company’s financial momentum supports the potential. CFO Sarah Friar recently revealed that OpenAI’s annualized revenue surpassed $20 billion in 2025, up from $2 billion in 2023. However, profitability remains uncertain, and advertising could be a key lever to improve margins. Mahaney warns that OpenAI’s move directly challenges Google’s dominance in digital advertising. If ChatGPT successfully integrates non-intrusive, context-aware ads—and develops conversational ad formats where users discuss and research purchases within the chat—it could capture a growing share of commercial queries currently routed to search engines. Still, Mahaney cautions that OpenAI won’t displace Google overnight. The tech giant has decades of ecosystem dominance, including Chrome, Android, and a deeply ingrained user habit of searching online. But if OpenAI can deliver a seamless, engaging experience where users naturally explore products and services within the chat interface, advertisers may begin shifting budgets toward this new channel. The long-term impact hinges on execution—but the potential for OpenAI to become a major player in the $300 billion+ digital advertising market is now a serious possibility.