FILE PHOTO: Databricks logo is seen in this illustration taken December 17, 2024. REUTERS/Dado Ruvic/Illustration/File Photo

(Reuters) - Analytics firm Databricks said on Monday it was on track to hit $4 billion in annualized revenue, up more than 50% from the prior year, on the back of surging demand for its artificial intelligence products.

This follows the data and AI company's Series K funding close, where it raised $1 billion at a valuation exceeding $100 billion, co-led by Andreessen Horowitz, Insight Partners, MGX, Thrive Capital and WCM Investment Management.

The company plans to use the proceeds to accelerate its AI strategy, including expanding products, launching a new operational database category, and future AI acquisitions and research.

In the second quarter, the company serving around 15,000 customers, including energy major Shell and electric-vehicle maker Rivian, surpassed a $4 billion revenue run rate, with AI products reaching $1 billion.

Databricks is targeting a net revenue retention above 140%, more than 650 customers with more than $1 million in annual spending and positive free cash flow over the past 12 months, the company said.

The San Francisco-based company is seen as one of the leading candidates to go public. Databricks CEO Ali Ghodsi said in an interview that the firm has received numerous investor inquiries since the successful $1.22 billion initial public offering of design software firm Figma, another venture capital-backed startup, in July.

Databricks, founded in 2013, offers a platform designed to help users ingest, analyze and build AI applications using complex data from a variety of sources.

(Reporting by Kritika Lamba in Bengaluru; Editing by Vijay Kishore)