Institutional investors have told Anthropic that its planned initial public offering later this month should value the Claude maker at around $1.5 trillion to $1.6 trillion, well below figures closer to $2 trillion that had circulated in recent months, the Wall Street Journal reported on November 2.
According to the Journal, big investors who plan to participate in the IPO have coalesced around the lower figure in the past several days, citing last week’s rout in technology stocks. Anthropic has not finalized a valuation target and is still deciding how many shares it plans to sell.
Why investors are pulling back
The investors pointed to a list of concerning factors, including choppy markets and growing worries about overexposure to AI bets. The Journal cited double-digit drops in technology stocks including Intel and Alphabet after a string of disappointing earnings results: Alphabet reported that growth in Google’s search-advertising business had slowed, hurt by “AI-mode” queries; Amazon’s revenue missed analyst expectations; and Intel forecast a prolonged slowdown in personal-computer sales.
Political backlash to data centers and uncertainty about how soon hyperscalers such as Amazon and Meta can show AI-related profits are also weighing on investors’ minds, according to the report.
An earlier warning, before the selloff
This was not the first push toward a lower number. The Journal noted that Anthropic had already been hearing from some investors after its investor day last month that the valuation should be closer to $1.5 trillion, a shift also reported by The Information and Reuters before the worst of the market drop.
Separately, Bloomberg reported last week that Anthropic had tapped JPMorgan to lead U.S. sales to individual investors, with roughly 15% to 20% of the offering potentially set aside for retail buyers. Citigroup is expected to coordinate the international retail tranche.
A conservative pricing play
Some investors say they trust Anthropic’s chief financial officer, Krishna Rao, to set a conservative valuation and give priority to delivering IPO investors a first-day “pop” in the stock price. They believe that even if Anthropic debuts at roughly $1.5 trillion, the shares could jump toward $2 trillion by the end of the first trading day. Elon Musk’s SpaceX jumped 30% during its first day of trading in June, before the current wave of investor jitters around AI had taken hold.
Anthropic plans to launch its roadshow pitch to investors as soon as next week, with its stock-market debut on track for the week before Thanksgiving. It will suggest a target valuation at the time of the roadshow launch by revealing the number of shares it hopes to sell and a target price range.
The Journal also noted that Anthropic said in an updated filing Monday that its revenue hit $17 billion in the three months ended September 30, up from $11.6 billion in the prior quarter.
Why it matters
Anthropic’s listing would be the first public offering by a company focused primarily on building frontier AI models, and its pricing will set the reference point for later entrants such as OpenAI. A cooler valuation would signal that public-market investors, unlike private-market backers, are starting to price AI’s risks as well as its promise: the S-1 itself warns of “catastrophic or existential risks,” and Senator Elizabeth Warren gave Anthropic until November 3 to answer four pages of questions about those disclosures. The roadshow next week will show whether the $1.5 trillion figure sticks.
