Krutrim, India’s first GenAI unicorn, is shifting from developing AI models to cloud services after months of relative silence on product updates – a move that reflects the tougher economics of building large-scale AI systems.
On Tuesday, Krutrim said it was moving toward cloud services, adding that the shift follows an operational overhaul in late 2025 that included reallocating capital and talent and pausing its chip design efforts. The update comes more than a year after the Bengaluru-based startup launched its entry-level Krutrim-2 model.
The move follows a period of limited public activity from Krutrim, which has not made any major product announcements in recent months, with last post in X dated December. The startup did not appear in any of the sessions at India’s AI Impact Summit in New Delhi, which featured global players such as Anthropic, Google and OpenAI.
In contrast, rival Sarvam participated in multiple sessions at the six-day AI event, where it presented new open source models, hardware developments and commercial partnerships.
The changes also come after a series of redundancies at Krutrim over the past year, with cut over 200 roles in several rounds, according to local media reports. The launch pulled the Kruti AI assistant app from app stores in April.
Founded by Bhavish Aggarwal (pictured above), who also heads Ola and electric vehicle maker Ola Electric, Krutrim initially positioned itself as one of India’s early GenAI contenders, seeking to create homegrown alternatives to models from companies such as Anthropic, OpenAI and Elon Musk’s xAI. The startup raised $50 million at a $1 billion valuation in January 2024, reflecting early investor enthusiasm for India’s domestic AI ambitions, even though AI funding in the country remains much smaller than in the US
Krutrim said it generated about ₹3 billion (about $31.52 million) in revenue in fiscal 2026, a threefold increase from last year, along with its first annual net profit and margins topping 10 percent. The startup did not disclose how much of that revenue came from external customers versus its parent Ola’s ecosystem. Earlier reports said so about 90% of its revenue in the 25th year they came from group companies.
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However, Krutrim said it sees growing demand for its AI cloud services, with more than 25 enterprise customers in sectors including telecommunications, financial services and healthcare. He added that most of its GPU computing capacity is already dedicated to external workloads.
Sanchit Vir Gogia, chief analyst at Greyhound Research, said the move to the cloud made commercial sense, but warned that Krutrim’s profitability claims would have to be tested. “The level of proof has to rise with the claim,” he told TechCrunch.
While Krutrim is turning to cloud infrastructure, competitors like Sarvam have continued to release new AI models and sign partnerships, including a recent one with the space technology company Pixxel to develop an AI-driven orbital data center.
As Gogia notes, infrastructure may be the most viable short-term play in India’s AI market, even as the long-term ambition of building competitive models remains.
Krutrim did not respond to questions about its exact revenue mix, corporate customer base and recent restructuring.
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