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French AI start-up Mistral said its revenues have increased 20-fold over the past year, as it rides a growing wave of demand from European businesses and governments for alternatives to American tech companies.
Arthur Mensch, Mistral’s co-founder and chief executive, told the FT that its annualised revenue run rate — a measure of the previous month’s sales multiplied by 12 — was “north of $400mn”, compared with just $20mn a year ago.
He said the Paris-based group, which was valued at nearly €12bn last year, is on track to surpass $1bn in annual recurring revenue by the end of the year, following a push by Mistral to rapidly expand the number of its large enterprise customers to more than 100.
Mistral, which raised €1.7bn in September led by Dutch chip equipment maker ASML, on Wednesday announced it would invest €1.2bn to build out new AI data centres in Sweden, its first such facility outside France.
“We are diversifying and spreading our capacity across Europe,” Mensch said. “Europe has realised that its dependency on US digital services was excessive and at breaking point today. We bring them leverage because we bring them models, software and compute that is fully independent from US players.”
The Mistral AI website. Its customers include ASML, TotalEnergies, HSBC and several European governments © Gabby Jones/Bloomberg
Mistral is working with EcoDataCenter to build the facility, which will offer 23MW of computing power and come online next year. Mensch said Sweden was an attractive venue to host power-hungry AI chips because energy there was “both low carbon and relatively cheap”.
“It’s actually quite a predictable business so there is a strong appetite for underwriting the infrastructure investment,” he said, projecting that it would create more than €2bn in revenue over the next five years.
Mensch said readily available debt financing means Mistral would not need to float its business this year, even as US rivals OpenAI and Anthropic race to launch their initial public offerings. “This is definitely something we have in mind for the next few years,” he said, to “guarantee our independence down the line”.
Mistral’s rapid growth represents a marked turnaround from early last year, when many in the tech industry had written off the start-up, which was founded in 2023, in an AI race dominated by US and Chinese companies.
But in recent months, concern has intensified in European boardrooms and capitals that US President Donald Trump’s foreign policy could force a “tech decoupling”. The EU today relies on overseas providers, most of them American, for more than 80 per cent of its digital services and infrastructure.
Mistral, which counts Microsoft and Nvidia among its corporate backers, has long claimed its ambitions are global, not just European. But its position as Europe’s only homegrown developer of “frontier” large language models, and early backing from French President Emmanuel Macron, has left it well positioned to capitalise on regional demand for “sovereign” AI providers.
It has expanded efforts to build and run its own AI data centres, instead of relying on US “hyperscalers” such as Amazon, Microsoft and Google to take its products to market.
This “vertical integration” helps pay for chips that can train its next generation of models — running customer workloads by day and training new AI systems by night — as well as offering European customers comfort that their data is stored on local servers.
Providing sovereign AI infrastructure was “top of mind for everyone”, Mensch said.
“There has been a narrative for Europe to build data centres otherwise you will be left out,” he said. “What is important to realise is that it’s not that useful [for nation states] to only deploy compute if you’re only creating data centres for US hyperscalers.”
Mistral’s customers include ASML, TotalEnergies, HSBC and several European governments including France, Germany, Luxembourg, Greece and Estonia. About 60 per cent of revenues come from Europe, with the rest from the US and Asia.
Even as OpenAI’s ChatGPT and Anthropic’s Claude have rapidly become among the fastest-growing products in Silicon Valley history, Mensch said that many corporate customers had been “a bit disappointed by off-the-shelf chatbots”, which have struggled to bring a return on investment.
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“There is a little bit of [a] fairytale that at some point you will just get just a single system that you’re going to be able to run all of your processes,” he said.
That suggests the recent sell-off in traditional business software providers by Wall Street to the arrival of new AI systems such as Claude Code was not “very rational”. “I don’t think these businesses are going anywhere,” Mensch said, thanks to the business-critical data they hold.
However, the long-standing software start-up strategy of building user interfaces for particular sectors or industries “has less value today”, he said. “You can rely on AI to understand intent and generate the user interface that you need.”