Anthropic IPO valuation target cut to $1.5 trillion after selloff

Last week's technology selloff, including Monday's decline, has fed into the AI funding pipeline. The push for a lower valuation reflects that. Anthropic's public listing is becoming a test of investor appetite for AI exposure. A strong debut could revive the queue of waiting companies and steady sentiment toward AI-linked large-caps. A poor reception would deep concerns about overexposure. The computing commitments in the filing are also important beyond the IPO, as they indicate sustained long-term demand for data center capacity and chips, a positive signal for cloud and semiconductor suppliers despite the recent rout.

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Last week's tech rout has major investors discussing an Anthropic IPO valuation closer to $1.5 trillion, even as the company's revenue continues rising sharply.

Key points:

• According to people familiar with the matter, institutional investors have told Anthropic and its advisers that the IPO valuation should be between $1.5 trillion and $1.6 trillion, below the roughly $2 trillion figure discussed in recent months.
• Investors cite choppy markets, concerns about overexposure to AI, political opposition to data centers, and uncertainty over when hyperscalers will turn AI spending into profit.
• Anthropic has not finalized a valuation target or the number of shares it will sell; a roadshow could start as early as next week, with a debut targeted for the week before Thanksgiving.
• An updated filing showed quarterly revenue of $17 billion for the three months to Septmber 30, up from about $11.6 billion in the prior quarter, partly offset by about $600 million in price reductions.
• Anthropic disclosed purchase commitments and leases totalling approximatley $895 billion, with nearly $450 billion expected before the end of 2030.

Lare investors queuing for Anthropic's IPO are pushing for a valuation of around $1.5 trillion to $1.6 trillion, the Wall Street Journal (gated) reported. That figure is well below the roughly $2 trillion level that had been discussed in recent months, as last week's technology stock selloff dampens appetite for AI exposure.

According to the Journal, which coted people familiar with the matter, institutional investors have given that guidance to Anthropic and its advisers over the past severl days. Reuters had earlier reported that some investors were already recomending a valuation closr to $1.5 trillion after the company's investor day last month. That occurred before last week's double-digit declines in stocks such as Intel and Alphabet folowing disapointing earnings.

Investors have highlighted a number of concerns. These include volatie markets, worries about holding xcessive AI exposure, political resistance to new data centers, and doubts about how quikly hyperscalers such as Amazon and Meta Platforms can generate profits from their AI investments. Anthropic has not settld on a valuation target or the number of shares to offer.

Sme investors expect Chief Ffinancial Officer Kishna Rao to price the deal conservately, favoring a strong first-day gain for buyers, the Journal reported. Sme believe a debut near $1.5 trillion could rise toward $2 trillion by the end of the first tradig session. SpaceX gained 30% on its first trading day in June, before concerns about AI spread more broadly.

Anthropic could begin its investor roadshow as soon as next week, with the listing on track for the week before Thanxgiving. Unlike SpaceX, which set a single price, Anthropic is expected to propose a price range.

An updated filing on Monday showed Anthopic's revenue reached $17 billion in the quarter to September 30, up from about $11.6 billion in the previous quarter. Approximately $600 million in price reductions, from new model versions and contratual discounts, partly offset that growth. The company also disclosed computing purchase commitments and lease agreements totalling around $895 billion. Nearly $450 billion of that is expected before the end of 2030, and most of the remainder between 2031 and 2045.

The outcome matters beyond Anthropic. Other companies considering listings are waiting to see how the debut performs, and a smooth offering could open the way for a wave of new issues early next year.