Anthropic targets $1.4 trillion valuation in refined IPO prospectus

Anthropic has updated its IPO prospectus, targeting a valuation of $1.4 trillion, down from the $2 to $2.5 trillion range speculated six to eight weeks prior. The proposed share price range is between $70 and $78, up from the last private round price of $54. This reduction aligns with a broader trend of caution in the AI sector, where investors are scrutinizing how much revenue companies can generate after funding model development and compute infrastructure.

Earlier reports indicated the IPO was expected to be roughly six times oversubscribed at a targeted valuation of $1.5 trillion, with Ludwig Ensthaler describing that figure as a "steal" compared to OpenAI's recent $11 billion round at a $1.25 trillion valuation. However, the refined prospectus suggests a more conservative approach. The company reported an $80 billion run rate and is projected to hold $200 billion in cash on its balance sheet, more than any other US company.

The IPO is expected to generate $216 billion for current employees, with an average of $41 million per employee. Founders are selling 264 million shares each, reducing their stake to approximately 1% each. While the valuation is cited as roughly $1 trillion on a public basis counting only vested options, it reaches $1.4 trillion including all granted options. In contrast, OpenAI, which remains private, reported Q3 revenue of $10 billion, up 50% quarter-over-quarter, with enterprise revenue doubling to become a majority of total revenue. Anthropic reported revenue of approximately $17 billion in the same quarter. The IPO is scheduled for next week, with analysts noting that starting with a lower price range may generate stronger initial interest.