Chinese artificial intelligence (AI) startup DeepSeek has raised $15 billion in its second private funding round and is accelerating plans for a Shanghai listing in early 2027, potentially reaching public markets before OpenAI.
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The financing nearly doubled its original target amid strong investor demand, The Wall Street Journal reported Thursday (Oct. 22), citing people familiar with the matter.
DeepSeek was valued at approximately $74 billion before the round closed. The financing comes as investors question whether AI companies can turn rising infrastructure spending into sustainable profits. DeepSeek founder Liang Wenfeng told investors in September that the company’s annualized revenue run rate had reached $1 billion, according to the Journal.
That represents more than double the $400 million to $500 million annualized revenue reported in July, driven largely by cloud-based access to its models through application programming interfaces, PYMNTS reported.
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DeepSeek reportedly maintained gross margins of 70% to 80% on access to its V4 flagship model, despite charging less than U.S. competitors.
The company has also adjusted pricing to capture more revenue. In August, DeepSeek introduced peak-hour pricing that increased rates for its flagship models by roughly fourfold, while remaining cheaper than major rivals, PYMNTS reported.
However, annualized revenue does not establish profitability, particularly as DeepSeek continues investing in computing infrastructure.
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