Anthropic IPO Valuation Talks Fall

Prospective investors are discussing an Anthropic IPO valuation of $1.2 trillion to $1.3 trillion, down from $1.4 trillion to $1.5 trillion communicated to bankers days earlier and $2 trillion floated in early October, Bloomberg reported Friday. The Wall Street Journal reported Thursday that three major prospective investors said the offering needed a lower price; one suggested about $1 trillion. Bloomberg's reporting indicated investors and bankers were still working toward an offering. Anthropic declined to comment.

The reassessment followed a 6.4% drop in the Nasdaq 100 on Thursday, wiping out roughly $2.3 trillion in market value in its largest single-day decline on record. The Cboe Volatility Index reached its highest level since April 2025. Reuters reported the IPO roadshow was expected to begin the week of November 9, with pricing the following week, but four people familiar with investor discussions said investors questioned that schedule. They are seeking a more attractive valuation and awaiting October revenue, which Anthropic left blank in its updated S-1 filing.

The amended S-1 reported Q3 2026 revenue of $17 billion, 12× year-over-year growth, and nine-month revenue of $33.24 billion; its annualized run rate was about $68 billion. Net losses were $23.3 billion in Q3 and $104 billion for the first nine months. Fair-value remeasurement of convertible notes, primarily from Amazon, accounted for $72.4 billion, or 90%, of the first-half loss of $80.5 billion. That accounting effect largely disappears after the notes convert to equity following an IPO. Q3 operating expenses were $17.5 billion against $17 billion revenue, while Q2 operating profit was about $974 million. First-half operating cash flow was positive $3.9 billion; reports suggested free cash flow turned positive in Q3. Gross margin was about 85%.

Anthropic disclosed $895.4 billion in purchase and lease commitments, substantially all for computing and infrastructure. About $447.5 billion is due by the end of 2030, including about $69.8 billion in the 12 months after September 30, 2026—roughly four times current quarterly revenue. Goldman Sachs and Morgan Stanley are leading the IPO with 20 other banks; the offering aims to raise at least SpaceX's record $86.2 billion debut. Shares would trade on Nasdaq as ANT.

Separately, Model Evaluation and Threat Research (METR) said an evaluation using internal data over roughly 11 weeks, from mid-August through late October, found Anthropic's model capabilities on well-specified tasks improving around 2× as fast as a year earlier. METR said compute growth was not the driver and suggested AI systems helping develop newer AI systems may explain the acceleration. It cautioned the finding may apply only to automatically graded tasks, may reflect underestimated earlier progress, and involved internal disagreement and uncertainty. Anthropic did not respond to its request for comment. CEO Dario Amodei had urged the industry in a September 12 essay to slow capability improvements, warning recursive self-improvement could outrun understanding and control. He backed METR as an evaluator, as did OpenAI CEO Sam Altman.

The report also noted political and market pressures: ballot measures in multiple states seek to limit data center development. Bloomberg reported Microsoft tightened oversight of some data center projects involving Nebius, IREN, and Nscale; Nebius, IREN, and CoreWeave each lost roughly half their value over the past month. CoreWeave and SpaceX credit default swaps reached records implying higher default expectations. Tech stocks underperformed the S&P 500 by 10.7% over the past month, the most extreme one-month gap since May 2002, according to Truist Advisory Services. Vanda Research said retail selling was strongest since the COVID-19 pandemic. Investors still await October revenue and clarity on whether the $895.4 billion commitments are firm or contingent; the article says it remains unknown whether Anthropic will proceed at $1.2 trillion to $1.3 trillion, seek a smaller raise, or delay beyond Thanksgiving.

Prospective investors are discussing an Anthropic IPO valuation of $1.2 trillion to $1.3 trillion, down from $1.4 trillion to $1.5 trillion communicated to bankers days earlier and $2 trillion floated in early October, Bloomberg reported Friday. The Wall Street Journal reported Thursday that three major prospective investors said the offering needed a lower price; one suggested about $1 trillion. Bloomberg's reporting indicated investors and bankers were still working toward an offering. Anthropic declined to comment.

The reassessment followed a 6.4% drop in the Nasdaq 100 on Thursday, wiping out roughly $2.3 trillion in market value in its largest single-day decline on record. The Cboe Volatility Index reached its highest level since April 2025. Reuters reported the IPO roadshow was expected to begin the week of November 9, with pricing the following week, but four people familiar with investor discussions said investors questioned that schedule. They are seeking a more attractive valuation and awaiting October revenue, which Anthropic left blank in its updated S-1 filing.

The amended S-1 reported Q3 2026 revenue of $17 billion, 12× year-over-year growth, and nine-month revenue of $33.24 billion; its annualized run rate was about $68 billion. Net losses were $23.3 billion in Q3 and $104 billion for the first nine months. Fair-value remeasurement of convertible notes, primarily from Amazon, accounted for $72.4 billion, or 90%, of the first-half loss of $80.5 billion. That accounting effect largely disappears after the notes convert to equity following an IPO. Q3 operating expenses were $17.5 billion against $17 billion revenue, while Q2 operating profit was about $974 million. First-half operating cash flow was positive $3.9 billion; reports suggested free cash flow turned positive in Q3. Gross margin was about 85%.

Anthropic disclosed $895.4 billion in purchase and lease commitments, substantially all for computing and infrastructure. About $447.5 billion is due by the end of 2030, including about $69.8 billion in the 12 months after September 30, 2026—roughly four times current quarterly revenue. Goldman Sachs and Morgan Stanley are leading the IPO with 20 other banks; the offering aims to raise at least SpaceX's record $86.2 billion debut. Shares would trade on Nasdaq as ANT.

Separately, Model Evaluation and Threat Research (METR) said an evaluation using internal data over roughly 11 weeks, from mid-August through late October, found Anthropic's model capabilities on well-specified tasks improving around 2× as fast as a year earlier. METR said compute growth was not the driver and suggested AI systems helping develop newer AI systems may explain the acceleration. It cautioned the finding may apply only to automatically graded tasks, may reflect underestimated earlier progress, and involved internal disagreement and uncertainty. Anthropic did not respond to its request for comment. CEO Dario Amodei had urged the industry in a September 12 essay to slow capability improvements, warning recursive self-improvement could outrun understanding and control. He backed METR as an evaluator, as did OpenAI CEO Sam Altman.

The report also noted political and market pressures: ballot measures in multiple states seek to limit data center development. Bloomberg reported Microsoft tightened oversight of some data center projects involving Nebius, IREN, and Nscale; Nebius, IREN, and CoreWeave each lost roughly half their value over the past month. CoreWeave and SpaceX credit default swaps reached records implying higher default expectations. Tech stocks underperformed the S&P 500 by 10.7% over the past month, the most extreme one-month gap since May 2002, according to Truist Advisory Services. Vanda Research said retail selling was strongest since the COVID-19 pandemic. Investors still await October revenue and clarity on whether the $895.4 billion commitments are firm or contingent; the article says it remains unknown whether Anthropic will proceed at $1.2 trillion to $1.3 trillion, seek a smaller raise, or delay beyond Thanksgiving.