Pocket FM has doubled its annualised revenue run rate to $500 million as artificial intelligence now generates 93% of its audio library and 99% of new releases.
Ceo Rohan Nayak says the company uses AI to transform human concepts into finished stories at scale. The firm still relies on people for original ideas, but the technology handles the production work.
“We want to create great IPs that last 100 years, and that needs humans,” Nayak told TechCrunch.
The strategy avoids fully autonomous generation. Vasu Sharma, head of AI and a former scientist at Meta and Tesla, explained the team has trained custom models for writing and text-to-speech using years of listener data.
Nayak says this approach has made content production roughly 80 times cheaper. A batch of 100 hours that once took a year to make can now be produced in a single day.
The volume of output has surged. More than 550,000 creators are now producing approximately 2.5 million hours of AI-assisted content annually. Two years ago, the total catalogue was around 100,000 hours. The platform now hosts over 770,000 audio series.
This abundance has improved listener retention. The 12-month revenue retention rate has climbed from 44% to 76% over the last two years. Having more stories available helps match different listener preferences.
Revenue run rate grew from $250 million a year ago to $430 million in April before reaching $500 million today. Nayak notes the figure is calculated by multiplying monthly revenue by 12, rather than using contracted recurring revenue.
Growth followed expansion into the U.K., Germany and France, plus the launch of user-generated content in the U.S.
Some 96 titles have generated more than $1 million in revenue, with 13 crossing the $10 million mark.
The company serves over 250 million listeners in more than 20 countries, starting with India. The U.S. is now the largest market, accounting for roughly 70% of the annualised run rate after growing around 70% last year.
About $85 million of the revenue comes from ads, while the remaining $415 million comes from users paying to unlock individual episodes.
Moving beyond audio
Pocket Entertainment, the parent company, is applying the same model to video. Its microdrama app, Pocket Saga, has reached an annualised run rate of about $15 million in three months.
The app is currently available only in the U.S. and its content is entirely AI-produced. Unlike Pocket FM, human creators do not develop the stories for Saga. The startup also uses successful Pocket FM audio plots to create AI-generated videos without traditional live-action production.
The company plans to enter at least two more entertainment formats over the next five years. It also aims to license successful stories for books, television and movies.
Pocket Entertainment is in talks with investors to raise between $100 million and $120 million at a valuation of about $2 billion. Nayak declined to confirm the specific terms but said any new capital would fund further AI investment and new formats.
The company claims to be profitable and generating positive cash flow on an adjusted basis but will not disclose the figures.
A public listing is not on the immediate horizon. Nayak said there are no plans to go public in the next 24 months, though options remain open for a future listing in India or the U.S.
