Lambda Seeks $350 Million Ahead of Planned IPO

AI cloud infrastructure provider Lambda is seeking to raise at least $350 million ahead of a planned initial public offering later this year. The company is reportedly in discussions with Mubadala Capital to lead the funding round.

The proposed round is structured as convertible notes, offering investors stock at roughly a 20% discount to the expected IPO price. If Lambda does not go public within a year, investors would receive additional equity or cash interest payments. Participants in the round would also have the option to invest in the IPO.

The company had previously targeted an IPO in the first half of the year but has delayed the plan to the second half. The new funding would provide additional capital as it prepares for the listing.

Lambda generated more than $520 million in revenue during the year ending September 2025, with third-quarter sales up 80% year over year. The company reported a loss of around $175 million during that period. Lambda competes with other AI infrastructure providers such as CoreWeave and Nebius and recently signed a multibillion-dollar agreement with Microsoft to deploy tens of thousands of NVIDIA GPUs.