WSJ: Investors doubt Anthropic can hold $1.5 trillion IPO valuation after selloff

Key Points

1. Major investors told the Journal Anthropic's planned IPO valuation will likely fall below $1.5 trillion.
2. Anthropic targets the week before Thanksgiving for an offering raising up to $100 billion.
3. A cut would ripple through AI-linked portfolios tied to Google, Amazon and Nvidia.

The latest:

Anthropic’s planned initial public offering is unlikely to clear its expected $1.5 trillion valuation, three major investors who intend to participate told The Wall Street Journal, after a deep selloff in artificial-intelligence bets. One put the figure closer to $1 trillion. The company is aiming to list the week before Thanksgiving and had been expected to raise as much as $100 billion.

Details:

• The target: Anthropic has been working toward an offering the week before Thanksgiving that could raise up to $100 billion at a valuation near $1.5 trillion, according to people familiar with the matter. That would be the largest IPO on record, surpassing the mark set by SpaceX’s offering in June.
• The doubts: Three major investors who plan to buy into the deal said the valuation will likely need to come down, with one telling the Journal it could land closer to $1 trillion. Until this week, many of the same investors had described Anthropic as a must-own name even as other AI stocks wobbled.
• The revenue line: Some investors want to see October results before assuming any cut. Anthropic’s run rate — a metric used to estimate annual revenue — topped $80 billion at the end of October, up from the prior month, according to a person familiar with the matter.
• The cash position: Anthropic held $146.6 billion in cash as of Sept. 30. One investor planning to participate said the company could raise less than expected, perhaps around $80 billion, and hoped it would hold well over $200 billion on its balance sheet after the offering.
• The delay option: Another prospective participant questioned whether Anthropic might postpone the listing to wait for better conditions, saying even a rebound may not quickly persuade institutional investors burned in the selloff to take on fresh AI-sector risk.
• The market trigger: Companies in the Nasdaq composite shed $2.5 trillion of value Thursday. The drop came two days after midterm elections swept a bloc of AI skeptics into power and passed moratoriums that could slow data center development in the United States.
• The spillover: Anthropic’s business is interconnected with Google, Amazon and Nvidia, and both private and public market investors worry a change in its IPO plans could damage the rest of their portfolios, according to people familiar with the matter.
• The rival: Enthusiasm for AI names was already fading before Thursday. OpenAI has raised less than half of the $30 billion it initially targeted in its latest funding round, receiving $11 billion so far at a $1.25 trillion valuation, the Journal reported.
• The next meeting: Anthropic executives and advisers are expected to meet within days to discuss IPO plans. Some people familiar with the process said the company has avoided committing to specifics to preserve optionality, and no revised valuation or size has been announced.

Between the lines:

The gap between an $80 billion run rate and a $1.5 trillion valuation is what the selloff has put under scrutiny. Investors who called Anthropic a must-own name a month ago are now debating pricing it a third lower, which says less about revenue trajectory than about how much AI risk institutions can absorb after losing $2.5 trillion in a session.

What’s next

Watch the meeting between Anthropic executives and advisers in the coming days, the company’s October figures, and whether the listing holds its pre-Thanksgiving window, slips, or prices below $1.5 trillion.