Who should call the shots on Anthropic PBC’s initial public offering? The potential buyers, of course. Artificial intelligence hasn’t changed the fact that you can easily lose money on an IPO and investors therefore deserve a corresponding chance to make a quick buck. Like all new stock sales, the Claude developer’s deal needs to be priced to fly.
Anthropic’s backers were reportedly seeking a $2 trillion valuation for the forthcoming listing back in August. The market backdrop is very different today. Rising interest rates and a potential US policy shift on data centers following the midterm elections have pummeled tech valuations. The company is now working on a deal at a valuation between $1.25 trillion and $1.75 trillion, according to the Financial Times.
Investors have their sights set on the bottom end of that range and some are eyeing a number as low as $1.1 trillion, Bloomberg News reported on Friday. Recall that Anthropic was valued at just under $1 trillion in its last funding round in May.
This could just be brinkmanship. But given the huge uncertainties here, the investment community is not simply being mean in driving down the price.
Valuing Anthropic is a mind-bending task because there are no real comparator companies, the numbers are changing quickly and the pace at which sales will become sizeable earnings is uncertain. Revenue in the first nine months of 2026 was 13 times the total in the same period last year. The latest annualized run rate — a projection of 12-month revenue — is $81 billion, the FT reported. That’s more than the yearly sales of the overwhelming majority of S&P 500 members. Despite its vast size, Anthropic still displays the high growth usually associated with a startup.
Investors don’t generally buy an IPO for the revenue and profit it’s making today; they look a few years out. Anthropic’s annual sales could expand at a compound annual rate of over 40% starting in 2027, reaching nearly $270 billion in 2029 and generating some $70 billion of operating profit (on an adjusted basis, excluding the impact of stock-based pay), Bloomberg Intelligence forecasts.
The 26% operating margin would still be humdrum compared to what the big tech firms report, a reminder that the fluent and plausible-sounding answers from AI chatbots need lots of expensive computing power to produce. Anthropic has locked itself into some chunky commitments to buy that so-called compute.
There are countless approaches to valuation here. While the company is going to turn profitable soon, plenty of questions remain over its revenue trajectory, and still more over the various measures of profit. Setting valuation as a multiple of future revenue uses the least uncertain metric and has the advantage of simplicity.
Alphabet Inc., Meta Platforms Inc. and Microsoft Corp. trade at 5.4 to 9.5 times next year’s sales. Fast forward two years and value Anthropic’s prospective 2029 revenue on around 7.5 times and you get an enterprise value at the $2 trillion number that was tossed around earlier this year. Discounting that back at 15% annually would imply a $1.5 trillion present-day value. Now apply a further discount because IPO investors expect to buy below fair value. Set that at 20% to 30% and you land on the hoped-for IPO price of $1.1 trillion to $1.2 trillion that’s doing the rounds.
You can get to higher valuations by applying a more growth-centric revenue multiple or using a lower discount rate. The market for AI services could keep expanding through the next decade and Anthropic could take a hefty slice assuming it retains a leading technological position and pricing power. The threats to that scenario are competition, not just from domestic peer OpenAI but also from Chinese AI labs, and the risk that regulation slows development of AI itself or of its supporting infrastructure.
Anthropic is not a total price-taker here. The deal is so large that many investors will want to own the company because of its future influence on the trajectory of the overall market. But there should be no shame in an IPO valuation closer to $1 trillion than the $2 trillion originally envisaged. Anthropic should want its shares to pop on debut, potentially fueling upward momentum that would assist future stock sales. It’s only selling a small slice of itself, and haggling for the best IPO price would put the post-float performance at risk for a relatively small financial bonus. Sometimes IPO candidates just have to accept the going rate and get on with it.
This column reflects the personal views of the author and does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.
Chris Hughes is a Bloomberg Opinion columnist covering deals. Previously, he worked for Reuters Breakingviews, the Financial Times and the Independent newspaper.
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