DeepSeek's Annualised Revenue Run Rate Doubles to $1 Billion After API Price Hike

DeepSeek Annualised Revenue Run Rate Hits $1 Billion

Chinese AI startup DeepSeek has achieved an annualised revenue run rate of $1 billion, more than doubling from under $500 million just a few months ago, according to 1

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. The report cites two people with direct knowledge of the matter, marking a significant milestone for the AI company that challenged US assumptions about China's AI capabilities last year. This run rate projects yearly income by assuming the company maintains its current earning pace, demonstrating strong momentum rather than money already banked.

API Price Increase Drives Revenue Growth

The revenue surge was partly driven by a substantial API price increase that DeepSeek implemented after warning developers in August. According to 2

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, fees went up between 2.3 to 4.5 times depending on the model. Despite these significant hikes, founder Liang Wenfeng told investors that customers had stayed, indicating strong demand for DeepSeek's AI models. Most of the company's revenue comes from developers who pay to use DeepSeek's models through its API, while the company's chatbot remains free to use.

Initial Public Offering Plans and Funding Expansion

CEO Liang Wenfeng shared these revenue numbers in a recent meeting with investors as the Chinese AI startup prepares for an initial public offering. The company aims to raise 50 billion yuan ($7.45 billion) in an IPO, valuing it at 500 billion yuan, by October-end, ahead of a listing on the 3

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. DeepSeek has hired CITIC Securities to prepare for a potential STAR Market IPO, though the timing, valuation and fundraising size remain undecided. The company only began taking outside money this year, closing its first round of roughly $7 billion in June, with Liang himself providing a large share of the cash.

Model Development and Computing Capacity Allocation

Despite its commercial success, DeepSeek continues to devote the bulk of its resources to developing new AI models. Liang told investors that the company allocates more than 70% of its computing capacity to training while reserving less than 30% for inference, or running existing models. This strategic focus on model development underscores the company's long-term commitment to innovation. Earlier this month, the company released its latest model, 4

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, designed for greater capability, faster inference speed, higher throughput and scalability to larger models.

Revenue Trajectory and Market Impact

The Information reported last month that DeepSeek earned about 475 million yuan ($70.7 million) in the first seven months of 2026, roughly ten times its revenue for all of 2025. This rapid growth trajectory highlights how quickly the firm has expanded since its models upended American assumptions about China's AI capabilities. The second funding round has not run smoothly—DeepSeek paused it in July after leaked remarks by Liang went viral on Chinese social media, then restarted talks in August. However, the company is now finalizing a raise of $7.5 billion as it nears the end of this funding expansion. The achievement of a $1 billion annualised revenue run rate positions DeepSeek as a formidable player in the global AI landscape, with implications for how investors and competitors view China's AI sector moving forward.