That question, along with many others, answered by David Karp ..
The answer on Tumblr profits, if you’re interested, David Karp said:
There are a couple things we are excited about: promoting content and marketplaces.
The marketplaces are awesome to us because they allow us to cut big checks to our guest developers. People who are creating original themes for our community can sell them to users. The community is thrilled because they are exclusive, unique, customizable and beautiful. They were hustling to try and sell them on their own. Designers are now selling them on Tumblr, and these brilliantly talented designers are quitting their gigs at design firms to design themes for Tumblr.
Users are also paying for promotion in our directories
While I may not truly understand it, the Coal Speaker is on Tumblr. So I have always wondered how Tumblr is making money from this whole thing..
And it also makes me want Tumblr to finally come up with a backup ability for non-Mac users!
If Tumblr is free, how does it make money?