Krutrim Pivots From AI Model Development to Cloud Services, Cutting 200+ Jobs
Tags AI · Enterprise · Infrastructure
Krutrim, India's first generative AI unicorn valued at $1 billion, announced it is abandoning its AI model and chip design ambitions to focus on cloud infrastructure services. The Bengaluru-based startup, founded by Bhavish Aggarwal (also CEO of Ola and Ola Electric), reported ₹3 billion ($31.52 million) in revenue for FY2026, a threefold increase from the previous year, and achieved its first annual net profit. Workforce dropped from over 550 employees in August 2025 to roughly 150-160 by March 2026. The pivot follows a late-2025 business overhaul that paused chip design efforts and reallocated capital from LLM development to cloud infrastructure. The company pulled its Kruti AI consumer chatbot from app stores in April 2026.
Technical significance
Krutrim's pivot from AI model development to cloud services illustrates the economic reality facing AI startups outside major funding hubs: building competitive large language models requires massive capital and technical resources that favor well-funded incumbents. The shift suggests that many AI startups may find more sustainable business models in specialized infrastructure services rather than competing directly with OpenAI, Anthropic, and Google on foundation models.