Gravity AI IPO - Investor Summary

Get ready to explore Gravity AI, a company poised for its Initial Public Offering (IPO). This summary, based on its preliminary F-1 filing dated February 6, 2026, offers a clear, concise overview. It helps retail investors understand the company's business, financials, risks, and IPO details.

1. What Gravity AI Does (Business Description)

Gravity AI develops specialized software, enabling businesses to use Artificial Intelligence (AI) models on their sensitive and proprietary data without moving it from their secure, on-premise or private cloud environments. This "AI without data movement" approach is crucial for industries with strict data privacy regulations (like healthcare, finance, and government) and for companies protecting valuable intellectual property.

Its platform uses advanced federated learning and homomorphic encryption techniques, deploying AI algorithms directly within a client's data infrastructure. This ensures sensitive data remains under the client's control, never exposed to Gravity AI or transferred to external AI models. This approach significantly mitigates privacy and security risks inherent in traditional cloud-based AI solutions. Gravity AI primarily targets large enterprise clients in sectors such as financial services, healthcare, and defense.

2. Company Structure

When you invest in this IPO, you buy shares in Gravity AI, a holding company incorporated in the Cayman Islands. Its wholly-owned subsidiary, Gravity Supply Chain Holdings Pte. Ltd. (Gravity SG), based in Singapore, handles core business operations, including software development, sales, and service delivery. The company also maintains smaller support and administrative offices in Hong Kong and the UK. This common international structure means your investment is in the Cayman Islands parent company, which then owns the operating subsidiary.

3. Financial Snapshot & Growth (Financial Highlights)

Gravity AI has demonstrated significant growth in recent years, driven by increasing demand for secure AI solutions.

• Revenue: Revenue surged from $35 million in fiscal year 2024 to $70 million in fiscal year 2025, marking a 100% year-over-year growth.
• Gross Margin: Gravity AI maintained strong gross margins of approximately 80% for both 2024 and 2025, reflecting the high value and scalability of its software.
• Profitability: Despite rapid revenue growth, the company is heavily investing in expansion. It reported a net loss of $15 million in 2024, which improved to $5 million in 2025. The company aims for profitability, targeting positive net income within the next 12-18 months.
• Customer Growth: Gravity AI doubled its enterprise client base from 50 at the end of 2024 to 100 by the end of 2025, showing strong market adoption.
• Annual Recurring Revenue (ARR): As of December 31, 2025, its ARR reached approximately $70 million, underscoring the recurring nature of its subscription-based revenue model.

4. How Gravity AI Makes Money

Gravity AI primarily generates revenue through recurring software subscriptions. Clients pay an annual or multi-year fee to access Gravity AI's secure AI platform and tools. This subscription model provides predictable revenue streams and fosters long-term client relationships. The pricing structure is typically tiered based on the scale of deployment, number of AI models, and data processing volume.

5. Use of IPO Proceeds

Gravity AI expects to raise approximately $16.88 million in net proceeds from this IPO. This assumes a $4.50 per share offering price (the midpoint of the estimated range) and accounts for 7.5% underwriting discounts and commissions ($1.27 million) and estimated offering expenses ($0.75 million).

The company plans to allocate these net proceeds as follows:

• 40% ($6.75 million): Research and development (R&D) to enhance existing platform features, develop new AI capabilities, and explore advanced encryption.
• 30% ($5.06 million): Sales and marketing expansion, including hiring additional sales personnel, expanding into new geographic markets, and increasing brand awareness.
• 20% ($3.38 million): General corporate purposes, including working capital, capital expenditures, and potential strategic acquisitions of complementary technologies or businesses.
• 10% ($1.69 million): Repayment of outstanding short-term debt.

Underwriters also hold an option to purchase up to an additional 15% of the shares offered (562,500 shares). They will also receive warrants to purchase 4% of the shares sold in the IPO, which could lead to further dilution and additional proceeds if exercised.

6. Key Risks for Investors (Risk Factors)

Investing in Gravity AI carries several risks, common to growth-stage technology companies and specific to its business model:

• Intense Competition: The AI and cybersecurity markets are highly competitive. Larger technology companies (e.g., cloud providers like AWS, Microsoft Azure, Google Cloud) could develop similar secure AI offerings, or new startups might emerge with disruptive technologies.
• Rapid Technological Change: The field of AI and data security evolves quickly. Gravity AI must continuously innovate to maintain its technological edge and prevent its solutions from obsolescence.
• Reliance on Key Personnel: The company depends heavily on its executive team, particularly CEO Chen Jiangnan and CFO Hemant Kumar Bhatt, and its ability to attract and retain highly skilled AI and security engineers.
• Path to Profitability: While revenue growth is strong, Gravity AI is currently unprofitable. There is no guarantee it will achieve or maintain profitability, and it may require additional capital raises.
• Market Adoption: Despite growing data privacy concerns, there is no guarantee that a sufficient number of enterprises will adopt Gravity AI's specialized, potentially higher-cost, secure AI solutions over more general alternatives.
• Economic Downturns: A general economic slowdown could lead enterprises to reduce software spending, impacting Gravity AI's sales and growth.
• Company Structure Complexity: Investing in a Cayman Islands holding company that owns a Singaporean operating subsidiary introduces additional legal, regulatory, and tax complexities compared to investing directly in a U.S.-based operating company.
• Concentrated Ownership: Post-IPO, CEO Chen Jiangnan and CFO Hemant Kumar Bhatt will collectively own approximately 39.51% of the company's outstanding shares. While not a "controlled company" under NASDAQ rules, this significant ownership stake grants them substantial influence over corporate decisions, which may not always align with other shareholders' interests.
• Reduced Reporting Requirements: As an "emerging growth company" and a "foreign private issuer," Gravity AI qualifies for reduced public company reporting requirements under U.S. securities laws. This means investors may receive less frequent or detailed financial and operational information compared to larger, U.S.-based public companies.
• Cybersecurity Risks: Despite offering secure solutions, Gravity AI itself is subject to cybersecurity threats that could compromise its own systems, intellectual property, or client data, leading to reputational damage and financial losses.

7. Competitive Landscape

Gravity AI operates in a specialized niche within the broader AI and cybersecurity markets.

• Indirect Competition from Cloud Providers: While major cloud providers (e.g., AWS, Microsoft Azure, Google Cloud) offer general AI services, Gravity AI differentiates itself by providing a specialized layer that ensures data never leaves the client's secure environment—a capability general cloud offerings do not fully match.
• Traditional Cybersecurity Firms: Companies like Palo Alto Networks or CrowdStrike focus on network and endpoint security. Gravity AI complements these firms by addressing the specific challenge of securely deploying AI models on sensitive data, rather than general data protection.
• Other AI Software Companies: Many companies offer AI tools for specific applications (e.g., marketing, customer service). Gravity AI's unique selling proposition is its secure deployment mechanism for AI. This makes it a foundational layer for any enterprise using AI with sensitive data, rather than a direct competitor to application-specific AI vendors.
• Emerging Niche Players: Smaller, specialized startups may also explore federated learning or homomorphic encryption for secure AI. While Gravity AI's F-1 filing does not specifically name these, they represent a potential competitive threat.

8. Management Team & Governance (Management Team)

Gravity AI is led by an experienced management team:

• Chen Jiangnan: Chief Executive Officer. Mr. Jiangnan has over 15 years of experience in AI research and enterprise software development. He previously led AI initiatives at a major financial technology firm.
• Hemant Kumar Bhatt: Chief Financial Officer and Chairman of the Board. Mr. Bhatt brings over 20 years of experience in corporate finance and strategic leadership. He has guided technology companies through growth phases and public offerings.

Board of Directors: The board of directors includes industry experts and independent members. While this summary does not disclose specific names and detailed biographies for all board members, the full F-1 filing provides these details. Corporate Governance: The company plans to establish an audit committee, compensation committee, and nominating and corporate governance committee once its registration statement becomes effective. This summary does not disclose specific members of these committees.

As noted, Mr. Jiangnan and Mr. Bhatt will collectively own approximately 39.51% of the company's shares post-IPO, aligning their interests with long-term company performance.

9. IPO Details (Offering Details)

• Exchange: Gravity AI expects its shares to trade on the Nasdaq Capital Market.
• Ticker Symbol: GRAV
• Shares Offered: Gravity AI plans to offer 3.75 million ordinary shares to the public.
• Price Range: The estimated offering price is between $4.00 and $5.00 per share, with a midpoint of $4.50.
• Total Shares Outstanding Post-IPO: Approximately 88.8 million shares.
• Implied Market Capitalization: At the midpoint price of $4.50 per share, Gravity AI's implied market capitalization upon listing will be approximately $400 million.
• Over-Allotment Option: Underwriters have an option to purchase up to an additional 15% of the shares offered (562,500 shares) to cover over-allotments if demand is high.

Disclaimer: Investing in an IPO involves significant risks and is not suitable for all investors. This summary is based on preliminary information and should not be considered investment advice. Investors should carefully review the full F-1 filing and consult with a financial advisor before making any investment decisions.