China's Zhipu AI expects 2025 revenue to grow 4x

Zhipu, a Beijing-based AI model developer, expects its 2025 revenue to reach up to 4x its 2024 total of US$42 million, according to CEO Zhang Peng.

The company develops AI models and services for enterprise customers, including several major Chinese state-owned firms.

Zhipu is also expanding into Southeast Asia and Africa, where Chinese companies have established infrastructure projects.

The firm is currently restricted from accessing certain US technologies following its addition to a US trade blacklist in January, which the US government said was due to concerns about support for China’s military.

Zhipu said it disagrees with the US decision and continues to serve tens of thousands of customers.

Earlier this week, Zhipu released GLM-4.5, a new open-source large language model targeting business and government users.

Founded in 2019 by Tsinghua University researchers, Zhipu has raised over US$1.5 billion from investors including Alibaba, Tencent, Meituan, and several state-backed funds.

🔗 Source: The Information

🧠 Food for thought

1️⃣ Aggressive pricing becomes key weapon in China’s AI market expansion

Zhipu’s revenue growth ambitions reflect the intense price competition driving China’s AI sector, where companies are undercutting each other dramatically to gain market share.

The company’s new GLM-4.5 model charges just 11 cents per million input tokens compared to DeepSeek’s 14 cents, but the gap widens significantly for output tokens—28 cents versus DeepSeek’s $2.19 1.

This pricing war strategy aligns with Zhipu’s focus on practical deployability and return on investment, as CEO Zhang Peng emphasized in discussing their market approach.

The aggressive pricing reflects a broader trend where Chinese AI companies prioritize rapid user acquisition over immediate profitability, as seen with Chinese tech giants like Alibaba and Tencent historically gaining dominance through subsidized services.

2️⃣ Chinese AI firms maintain momentum despite US restrictions through alternative funding and partnerships

Zhipu’s ability to raise over $1.5 billion while on the US trade blacklist demonstrates how Chinese AI companies are successfully navigating geopolitical constraints through diversified funding sources.