According to The Information, AI software provider Databricks expects its annualized revenue to reach $3.7 billion by July 2025, representing a 50% year-over-year increase as more large companies invest in building AI applications from their business data.
The impressive 50% growth rate positions the company to potentially reach $4 billion in annual revenue by late 2025 if current momentum continues.12 This acceleration builds upon Databricks' strong performance in late 2024, when it crossed $3 billion in annual recurring revenue, up 60% year-over-year from $1.9 billion at the end of 2023.3 The company has maintained this upward trajectory while simultaneously achieving positive free cash flow in Q4 2024 for the first time in its history.
Looking further ahead, Databricks has communicated ambitious targets to investors, projecting sales growth exceeding 40% in both 2025 and 2026.4 This sustained performance would push revenue to approximately $5.4 billion by January 2027, reflecting the company's confidence in its market position and product strategy despite increasing competition in the data analytics space.5
The competitive landscape between these two data giants reveals distinct trajectories, with Snowflake generating nearly $3.5 billion in product revenue for the 12 months ending January 31, 2025, representing a 30% year-over-year increase.12 While Snowflake currently maintains a slight revenue advantage with $3.83 billion in trailing twelve-month revenue3, Databricks' accelerated 50% growth rate suggests it could overtake its rival sometime in early 2026.45
This rivalry highlights different strategic approaches, with Databricks focusing on its unified lakehouse architecture that combines traditional data warehousing with advanced machine learning capabilities. Snowflake, meanwhile, has set more modest AI revenue targets, with executives aiming to reach just $100 million in annual recurring revenue from generative AI products by their fiscal year end.2 The competition extends to specific product segments, with Databricks SQL expected to reach a $1 billion revenue run rate by January 2026, directly challenging Snowflake's core data warehousing business.6
While the exact breakdown of Databricks' projected $3.7 billion revenue remains unspecified, the company's growth is clearly being fueled by enterprise adoption of AI technologies. Nearly 50 of Databricks' 15,000+ customers are spending over $1 million annually on the platform, demonstrating strong enterprise commitment to their solutions.1 This contrasts sharply with Snowflake's more modest AI ambitions, as Snowflake executives have targeted just $100 million in annual recurring revenue from generative AI products by their fiscal year end in January.2
The data warehouse segment represents a particularly significant growth opportunity, with Databricks projecting $1 billion in revenue from this business line alone.3 This strategic focus on AI-driven data infrastructure positions the company to capitalize on what analysts estimate could become a $426 billion annualized market opportunity by targeting higher-income consumer segments.3 The impressive growth metrics suggest Databricks is successfully executing its vision of becoming the dominant platform for enterprise AI and data analytics in a rapidly expanding market.
Despite impressive revenue growth, the AI software provider has not yet committed to a specific IPO date. CEO Ali Ghodsi has indicated that while a 2025 public offering remains "a possibility" and "would be the earliest," the company could potentially wait until 2026.1 This cautious approach aligns with Ghodsi's previous statement that "it's dumb to IPO" prematurely, emphasizing the importance of favorable market conditions.2
Following a substantial funding round earlier this year, the company secured a $62 billion valuation,3 positioning it for what could become one of the most anticipated tech IPOs when it eventually materializes. Investment bankers familiar with the company's strategy estimate the public offering could come in the second half of 2025 or early 2026, though the company is technically prepared to launch within two months if market conditions prove optimal.4 This strategic patience demonstrates Databricks' confidence in its private valuation and growth trajectory while waiting for the ideal market window.
