In early October, Anthropic went into its IPO conversations targeting a $2 trillion valuation. Four weeks later the number people are discussing is about a trillion lower. Axios traced the curve on November 6, and it falls in three steps.
By mid-October investors were landing near $1.5 trillion, pointing to slower revenue growth in the third quarter. I covered that yesterday. After Thursday’s selloff, and with the midterms in view, the Wall Street Journal reports discussions as low as $1 trillion; Bloomberg cites investors putting it between $1.1 and $1.3 trillion.
What happened on Thursday
The Nasdaq Composite closed down 5.5 percent, firmly in correction territory and almost 12 percent below its October 6 high. The SOX semiconductor index dropped 12.3 percent. Two days earlier, Democrats had made historic gains in the midterms, and investors have been pricing in the real possibility that data center buildouts slow down. Friday brought some relief without settling the direction.
Anthropic sits deeper in this than any other model company. Nearly $900 billion in computing and infrastructure commitments are on its books, with Amazon, Google, Microsoft and Broadcom on the other side. From there the chain runs on to chipmakers, networking vendors, data center operators and power suppliers.
A low valuation might be the better one
Max Kettner, chief multi-asset strategist at HSBC, described on Bloomberg Radio what is driving the AI trade right now: a series of narratives, and the current one says the AI cycle is dead. Kettner does not believe it. For him, Anthropic’s listing is the biggest available catalyst to turn that narrative around, and the surest route there would be a conservative valuation, even one below a trillion.
The comparison he fears is SpaceX: buying euphoria first, then the reversal, and the stock stuck under its offering price for more than a month. For a bruised market, that would be the worst version.
The listing is now a test for everyone else
The timing is still open; the talk is of later in November. What has shifted is the role. Four weeks ago Anthropic’s IPO was the largest offering in history, in preparation. Today it is the price at which the market reprices the entire AI bet. Which explains why a lower valuation is awkward for Anthropic and possibly the friendlier news for the industry.