1Password Surpasses $500 Million in Revenue as AI Agents Drive Growth

As businesses and consumers increasingly adopt artificial intelligence agents, 1Password is aiming to position itself to deliver solutions for growing challenges around security, access and trust.

The Canadian late-stage cybersecurity startup has surpassed $500 million in annual recurring revenue, up from $400 million in November 2025, with a free cash flow margin in the double digits, the company said.

The growth has been driven by an explosion in coding assistants and agents in enterprise settings, whose access to company secrets and systems needs to be closely managed, Chief Executive David Faugno said.

“The agents can actually take those secrets and do things that are unpredictable,” Faugno said in an interview. “You have to be very, very clear about what access you give it, and how you monitor and maybe even revoke that access, and humans have to stay in control.”

The company’s net new ARR has grown around 60% through the first three quarters of this year, with 90% year-over-year growth in the third quarter, 1Password said. It now serves upwards of 200,000 businesses, including 85% of the Forbes AI 50 list of the most promising AI startups.

Faugno said that instances of AI agents going rogue or breaking containment, most notably the hack of Hugging Face by OpenAI internal agents, demonstrate the need for a focused approach to agentic security and access.

“At the end of the day, an agent found standing credentials to have access to something, and did something that was unintended. Every single one of these incidents ended up in that place,” he said. “This is the ticking time bomb, if you will, that sits everywhere in our society.”

So far, much of 1Password’s growth has come from the use of AI by developers, which Faugno said represents almost all of the value created by AI. About 75% of 1Password’s ARR comes from business customers, he said.

Faugno also sees opportunity in the consumer market, where 1Password got its start in 2005 as a password manager. He said revenue from consumers may inflect upward and become a larger part of the business going forward.

The new catalyst: personal AI agents like Meta’s Muse, Instinct, and GrokBot by SpaceX. The agents can exhibit unpredictable behavior or take actions their users did not intend, The Wall Street Journal has reported.

The company on Thursday plans to announce 1Password for Agents, a security platform designed to let personal AI assistants use passwords, credentials, and secrets without seeing or storing them. 1Password is launching the platform with partnerships with AI agent makers including Meta, SpaceX, and Instinct, as well as OpenAI and Anthropic.

“What each of these parties have seen in the early days of their rolling out these capabilities, packaged in this way, is that there’s a missing layer of trust,” Faugno said. “This is kind of the second act of AI creating value, and just like the first act, we’re right at the heart of delivering that trust layer.”

Faugno is hoping that 1Password, which was valued at $6.8 billion after its Series C funding round in 2022, will be able to ride the agentic AI trend to an initial public offering, though the company doesn’t have a specific timeline in mind. Other startups have delayed their IPOs in recent weeks amid high interest rates and volatile market sentiments around AI, although Anthropic is still preparing its mega-IPO for next month.

“We are of the scale and financial profile, with our profitability and our acceleration, that I think that we make an attractive candidate for a public company,” Faugno said. “We’re doing the work internally to prepare ourselves to do that at some point in the future, with no committed date or anything like that.”

Corrections & AmplificationsDavid Faugno is the chief executive of 1Password. An earlier version of this article misspelled his last name in one instance. (Corrected on Oct. 22)