Cohere hits $240 million in annual revenue, eyes 2026 IPO

Canadian artificial-intelligence startup Cohere has surpassed its financial targets for 2025, according to a CNBC report on a memo sent to investors. The company reported growth in annual recurring revenue (ARR)—a standard metric for subscription-based businesses that projects yearly revenue based on active contracts. The milestone highlights the company’s commercial traction as enterprise customers adopt generative AI technologies.

According to the investor memo reported by CNBC, Cohere’s financial performance in 2025 included:

• Annual recurring revenue: Reached $240 million by the end of the year, surpassing the company’s initial target of $200 million.
• Quarterly growth: Experienced quarter-over-quarter growth of more than 50% throughout 2025.

Founded in 2019, Cohere competes for enterprise AI adoption against other companies in the sector, including Google, Anthropic, and OpenAI. The startup has secured backing from enterprise tech investors including Nvidia, AMD, and Salesforce. Cohere’s core technology is its Command family of generative AI models, which are designed to be deployed on limited graphics processing units (GPUs) to help enterprises manage costs and resource deployment. To expand its enterprise offerings, Cohere launched North last summer. North is a higher-level enterprise platform and AI workspace designed for secure, custom AI agents and workflows built on Cohere’s models. These models and platforms form the basis of Cohere’s enterprise strategy, allowing the company to target businesses looking for secure AI deployment.

The company’s revenue growth comes as it considers a public debut. Cohere’s CEO, Aidan Gomez, stated last October that the startup may IPO “soon.” If the company does list in 2026, it may contend against competitors such as OpenAI, Anthropic, and SpaceX/xAI, which are reportedly weighing their own public debuts. A 2026 public listing would test public market appetite for enterprise AI startups, especially as multiple competitors reportedly prepare for their own market debuts.

Why it matters

Cohere’s strong revenue performance signals its readiness to compete with other AI labs in the public markets, potentially joining a crowded 2026 IPO field.