Anthropic Files IPO Prospectus; US Media Says Its Listing Will Test the Entire AI Industry

On October 27, Anthropic officially filed its IPO prospectus, moving ever closer to going public. The New York Times reported that Anthropic could list as early as next month. When that happens, the IPO will not only mark an important moment for this AI company's formal debut in the capital markets, but will also serve as a test of the broader U.S. economy, with trillions of dollars at stake.

Anthropic, developer of the Claude chatbot, is one of the pillars of the artificial intelligence industry. The company's valuation in the private market has approached $1 trillion, and it has raised more than $130 billion cumulatively. This IPO could raise $100 billion, quickly placing it among the world's most valuable publicly traded companies. But the stakes go even further than that.

A single move affects the whole

Anthropic and its main rival OpenAI sit atop a vast pyramid of business partners and suppliers. These companies include infrastructure providers, chipmakers, energy companies and AI startups. Over the past four years, they have all invested enormous sums because they believe demand for AI products will keep growing.

Anthropic's listing will, for the first time, give the outside world an in-depth look at the operating condition of a key company underpinning the AI boom, and will also test the sustainability of that boom. Is market demand for AI services truly endless, enough to support the massive spending by companies on chips, data centers and other infrastructure? Or will Anthropic's results show that demand ultimately has a ceiling?

"For the market, it's a bellwether," said Umesh Padval, an investor at venture capital firm Seligman Ventures, who has worked in the tech industry for nearly 40 years.

If Anthropic's market debut disappoints, it could dent investor confidence and trigger broader market selling, raising doubts about how much longer the AI boom can last. Conversely, if the IPO succeeds, it could lift the market and pave the way for more AI companies to go public.

The stock market is already in a nervous state. This month, tech stocks fell broadly, with companies that design and manufacture AI chips leading the decline. The Philadelphia Semiconductor Index has fallen 26% from its June high, entering a bear market, a sign that investor anxiety is already quite severe.

In recent weeks, Microsoft canceled a partnership agreement with data center supplier Nscale. A report published by research firm Gartner predicted that 80% of "neoclouds" (companies that provide data and computing power to AI companies) may be forced out of the market. In addition, Ken Griffin, the billionaire founder of hedge fund Citadel, said AI investors are "almost certainly" in a bubble.

Meta data center

These negative signals have further intensified market concerns about the enormous spending on AI infrastructure. Amazon, Meta, Google and Microsoft have all said they plan to spend at least $740 billion this year on AI infrastructure, including data centers. According to investment data tracker PitchBook, private-market investors have put $1.1 trillion into Anthropic, OpenAI and other AI companies since 2022.

As spending and investment in the private market continue to rise, investment in the public market is also expanding, making stock market performance increasingly dependent on the results of the AI industry. The top 10 companies by market value in the S&P 500 have a combined market value of more than $1 trillion, and eight of them are tech companies. Together, these 10 companies account for more than 40% of the index's weight, compared with less than 20% a decade ago.

Once Anthropic is added to the index, it will likely push Berkshire Hathaway or Eli Lilly out of the top 10. Those two companies are currently the only non-tech businesses with market values above $1 trillion.

"This listing is a big deal. If it doesn't go well, the whole market will be dragged down," said Brad Gastwirth, global head of research and market intelligence at supply chain services company Circular Technology.

Slowing growth

Anthropic filed its IPO prospectus on Monday, disclosing details of its rapid revenue growth and plans to spend up to $807 billion over the next decade on data centers, chips and cloud computing.

The document did not include Anthropic's third-quarter results. The company disclosed those figures to investors at its San Francisco headquarters this month. Anthropic's third-quarter revenue reached $16.8 billion, up 45% from the previous quarter. But investors noted that the company's second-quarter revenue grew 141% from the first quarter, far faster than in the third quarter.

How Anthropic explains this slowdown will be crucial. If the reason is that the company lost market share to OpenAI or to businesses using lower-cost open-source AI models, that would mean overall demand for AI services remains solid. But if Anthropic's growth is slowing because demand for AI products is weakening across the market, the market reaction could be more severe.

Anthropic's San Francisco headquarters

Over the past year, Anthropic has been the hottest company in Silicon Valley, thanks in part to Claude Code. The service has changed the way software engineers write code. As the company's revenue soared, private-market investors kept pushing up its valuation, which reached $965 billion, surpassing OpenAI.

The IPO market cools

To meet market demand for its AI products, Anthropic struck hundreds of billions of dollars' worth of agreements to rent computing power from Google, Amazon and Microsoft. It is also investing in Nvidia chips and in data centers run by companies such as Nscale. The businesses that provide services to Anthropic, in turn, are pouring huge sums into their own suppliers.

But this summer, some Anthropic customers concluded that they were spending too much on "tokens" (the units of data that AI systems process and generate). They began looking for cheaper options. Meta, one of Anthropic's largest customers, had projected spending up to $10 billion a year on the company's technology this year, but cut back as it shifted to other AI models.

Shares of some AI companies that went public this year have fallen sharply. Silicon Valley AI chipmaker Cerebras is down about 40% from its May offering price. Shares of AI infrastructure company Accelevation are now about a third below their September offering price of $18. After listing in June, Musk's SpaceX has also fallen well off its peak, though it is still about 9% above its offering price.

Against this backdrop, the pace of the IPO market has slowed. Holtec, which supplies nuclear power to the AI industry, withdrew its listing application last month. SB Energy, the data center company controlled by SoftBank, one of OpenAI's biggest backers, and Aggreko, a power company that works with data centers, have also postponed their listing plans.

Matthew Kennedy, a senior strategist at Renaissance Capital, which tracks listings, said AI infrastructure was the "number one theme" of this year's IPO market, "but it has also been one of the sectors hit hardest in the sell-off of the past few weeks."

Investment bankers have warned companies that they may not get the valuations being considered two months ago. David Solomon, CEO of Goldman Sachs, said on an earnings call this month that although the public offering market is "wide open," companies may choose to hold off on listing if they still hope to get valuations close to those discussed this summer. "The market softened somewhat in September," he said.

Anthropic's revenue figures have further deepened market doubts. Previously, the market expected the company to be valued at up to $2 trillion when it lists. But according to a person familiar with the matter, after seeing slowing revenue growth and a persistently sluggish market, some investors have begun discussing a valuation range of $1.5 trillion to $1.7 trillion.

AI industry executives have been working to reassure the market. This month, C.C. Wei, CEO of TSMC, which supplies chips to the AI industry, said the company's profit growth has "no ceiling."

Late last week, stocks fell further as concerns about AI spending mounted. The tech-heavy Nasdaq Composite posted its biggest one-day drop since June. (Author/Xiao Yu)

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