AI data giant Databricks seeks new round of financing, aiming for a $175 billion valuation; IPO may be postponed until next year

The financing boom in the AI infrastructure sector continues to heat up. Database management software giant Databricks is seeking a new round of financing, targeting a valuation of up to $175 billion, a significant jump from its previous round. Meanwhile, the company’s IPO plans are delayed again, possibly pushed to next year at the earliest.

According to The Information, citing multiple sources, Databricks has begun discussions with investors regarding the new round of financing, which may launch within the next month. The company has revealed a targeted valuation range of $165 billion to $175 billion to investors. This represents a significant increase from its valuation of $134 billion following the completion of its fundraising at the end of last year (including new capital raised). However, the final terms have yet to be finalized, and it is unclear whether the amount of new financing will be included in the valuation.

Regarding the IPO, Databricks co-founder and CEO Ali Ghodsi publicly stated in a Bloomberg TV interview last week that 2026 is a “bad time to go public,” citing the simultaneous listings of larger companies such as SpaceX. However, sources reveal that he has privately indicated to investors that the company is still intent on going public, possibly as soon as next year.

New Round of Financing: Valuation Surges Over 30%

If this round of financing is finalized at a $175 billion valuation, it would be about a 30% increase from the $134 billion at the end of last year. The 13-year-old company has so far raised nearly $30 billion in total, with existing investors including Andreessen Horowitz, NEA, and Battery Ventures, according to PitchBook Data.

It remains unclear what the primary use of funds for this round will be—whether it will inject new capital into the company’s balance sheet or be used for a secondary offering to repurchase shares from existing shareholders.

Strong Business Growth, AI Demand Accelerates Revenue

Continuous strong business performance has supported Databricks’ high valuation. In February, the company disclosed that its annualized revenue had surpassed $5.4 billion, up 65% year-on-year; annualized revenue from AI business alone exceeded $1.4 billion. The company also stated that it achieved positive free cash flow over the past year.

Ali Ghodsi stated at the time that the board, concerned about a potential downturn in AI’s popularity, proactively pushed the company to continue raising funds. This approach aligns with the company’s repeated strategy of postponing listing—rather than entering the public market, Databricks prefers satisfying its capital needs through private fundraising and secondary share transfers.

IPO Window: Competitors Emerge; Difficult Timing for Listing

Databricks’ decision to delay its IPO is partly due to changes in the competitive landscape of the public market. This week, OpenAI announced that it has filed for an IPO, and Anthropic previously submitted a similar filing. Together, the two companies may seek to raise hundreds of billions of dollars, siphoning off significant market capital.

Public market investors remain skeptical about whether established enterprise software companies can withstand competition from emerging AI firms. However, signs of recovery have appeared for some companies—Databricks’ competitor Snowflake’s stock price is up about 10% this year, though still far from its 2021 peak.

Valuation Logic: Private Market Continues to Offer Premiums

Databricks’ fundraising reflects the private market’s ongoing bet on the AI infrastructure track. Through repeated fundraising, the company can continue expanding without facing the volatility and valuation pressures of the public market, while providing liquidity exits for early investors and employees.

For potential investors, the core question is whether, against the backdrop of leading AI companies like OpenAI and Anthropic rushing to go public and attract funding, Databricks can continue its high growth and ultimately fulfill its promise of an IPO.

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