{"id":3098,"date":"2026-10-18T16:42:38","date_gmt":"2026-10-18T16:42:38","guid":{"rendered":"https:\/\/retrotradingreport.com\/index.php\/2026\/10\/18\/anthropics-ipo-valuation-cut-is-it-bad-news-for-ai-bulls\/"},"modified":"2026-10-18T16:42:38","modified_gmt":"2026-10-18T16:42:38","slug":"anthropics-ipo-valuation-cut-is-it-bad-news-for-ai-bulls","status":"publish","type":"post","link":"https:\/\/retrotradingreport.com\/index.php\/2026\/10\/18\/anthropics-ipo-valuation-cut-is-it-bad-news-for-ai-bulls\/","title":{"rendered":"Anthropic\u2019s IPO Valuation cut: is it bad news for AI bulls?"},"content":{"rendered":"
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Anthropic’s potential initial public offering is facing an early test of investor appetite, with some prospective and existing investors reportedly considering a valuation of around $1.5 trillion, below the roughly $2 trillion target previously expected for its November listing. <\/p>\n

The reassessment follows a slowdown in the company’s sequential revenue growth and comes as investors grow increasingly concerned about the cost of financing artificial intelligence infrastructure.<\/p>\n

A lower valuation could create pressure across AI-related stocks, particularly companies exposed to the enormous spending commitments of leading AI developers. <\/p>\n

Shares and bonds of Nvidia-backed data centre operator CoreWeave have already come under pressure<\/a> amid concerns about debt-funded AI expansion.<\/p>\n

However, a reduction in Anthropic’s expected IPO valuation does not necessarily mean the AI investment boom is ending. <\/p>\n

Investors must distinguish between concerns about how much leading AI developers are worth and whether demand for AI computing continues to grow.<\/p>\n

Anthropic reported third-quarter revenue of $16.8 billion<\/a>, up 45% from the previous quarter, and said it was profitable on an adjusted basis. <\/p>\n

The figures demonstrate substantial growth, even as some investors question whether the company’s valuation adequately reflects its slowing growth rate and significant future spending requirements.<\/p>\n

Anthropic’s $2 trillion IPO target faces investor resistance<\/h2>\n

According to a Reuters report citing people familiar with the matter, some current and prospective Anthropic investors discussed a valuation of approximately $1.5 trillion during the company’s investor day in San Francisco on Wednesday. <\/p>\n

That would represent a $500 billion reduction from the roughly $2 trillion valuation investors had previously expected for the planned November share sale.<\/p>\n

The discussions followed disclosures that Anthropic’s revenue growth had slowed sequentially in the third quarter. <\/p>\n

Revenue more than doubled from the first quarter to $11.6 billion in the second quarter, before rising 45% to $16.8 billion in the third quarter.<\/p>\n

Although the latest growth remained substantial, the deceleration disappointed some investors who had expected the company to sustain its earlier momentum.<\/p>\n

Anthropic’s financial performance is particularly important because the company has committed to enormous infrastructure spending. <\/p>\n

According to the company’s IPO prospectus, it has pledged to spend at least $518 billion over a decade on cloud services, computing and infrastructure, Reuters had reported in September.<\/p>\n

The prospectus also showed a loss of $42 billion in 2025 and projected further spending for the upcoming AI buildout. <\/p>\n

Last year, revenue surged twelvefold to nearly $4.6 billion, while the company recorded an operating loss exceeding $8 billion, excluding certain liability write-downs.<\/p>\n

These figures highlight the challenge facing investors: Anthropic is growing rapidly, but its future value depends partly on its ability to turn that growth into sustainable financial returns while meeting substantial computing costs.<\/p>\n

A lower IPO valuation could therefore reflect a reassessment of the price investors are willing to pay for that growth, rather than a rejection of the company’s business altogether.<\/p>\n

Slowing growth does not necessarily signal weak AI demand<\/h2>\n

The central question is whether Anthropic’s slower sequential growth reflects weakening demand for AI or increasing competition from alternative providers.<\/p>\n

One possibility is that customers are shifting spending towards competitors, including OpenAI, which launched its Astra model in early September, or other AI services. <\/p>\n

Meta Platforms could also capture a larger share of the market.<\/p>\n

Such a shift would not necessarily be negative for the broader AI industry. <\/p>\n

If overall spending continues to increase, one provider’s slower growth could be offset by stronger demand elsewhere.<\/p>\n

The more concerning possibility would be that businesses are reducing their AI investments altogether. <\/p>\n

However, available usage data suggests that adoption continues to expand.<\/p>\n

OpenRouter, a start-up that helps developers route requests across AI models, reported that weekly token consumption reached 172 trillion as of the previous week, up from 46.7 trillion at the end of June. <\/p>\n

Tokens are the basic units of text and other data processed by AI models.<\/p>\n

Wedbush Securities analyst Matt Bryson also argued that Anthropic’s results should not automatically be interpreted as evidence of slowing AI spending.<\/p>\n

In a note to clients, Bryson said annualising revenue trends over very short periods can be misleading, particularly when based on indirect reports. <\/p>\n

He also pointed to increased competition from alternatives to Anthropic, including Muse and Copilot, while noting that Anthropic still achieved 45% sequential revenue growth.<\/p>\n

Bryson added that Wedbush had not seen indications of slowing hardware demand. <\/p>\n

He cited rising GPU rental prices, including for older systems, and said concerns about financing costs and foundation-model growth did not appear to be affecting AI demand or supply-chain dynamics.<\/p>\n

Cheaper AI models could benefit cloud and infrastructure firms<\/h2>\n

Another explanation for Anthropic’s slower growth is the increasing use of open AI models, which are generally less expensive and can be adapted for more efficient applications. <\/p>\n

Improvements in hardware efficiency can also reduce the cost of processing AI tokens.<\/p>\n

This creates a potential shift in how value is distributed across the AI industry.<\/p>\n

Anthropic and OpenAI spend heavily on developing advanced, or frontier, models. <\/p>\n

If customers increasingly turn to cheaper alternatives, these developers could face pressure to justify their spending and valuations.<\/p>\n

Cloud providers and companies supplying computing infrastructure, however, could still benefit from rising overall usage.<\/p>\n

Amazon, Microsoft and Alphabet’s Google operate cloud businesses that can host a range of AI models. <\/p>\n

Greater use of open models could generate additional demand for their computing services without requiring them to share the revenue generated by developing those models.<\/p>\n

Gavin Baker, chief investment officer of Atreides Management, said in a post on X on Thursday that <\/p>\n

“Open-source growing much faster than either Anthropic or OpenAI. Modal tripled since May and is 15x YoY per yesterday\u2019s announcement. Open-source tokens generate more revenue and profit for the hyperscalers\/neoclouds than frontier tokens. *Every* open source inference cloud I am aware of is growing faster both sequentially and YoY than either Anthropic or OpenAI. And their combined compute spend is becoming material.”<\/p>\n

\n
https:\/\/twitter.com\/GavinSBaker\/status\/2110743424400068790 <\/div>\n<\/figure>\n

The argument points to a potential divergence within the AI trade. <\/p>\n

Investors may become more selective about which companies capture the financial benefits of growing AI adoption, rather than treating all AI-linked businesses as beneficiaries of the same investment cycle.<\/p>\n

Nevertheless, the distinction should not be overstated. <\/p>\n

Anthropic and OpenAI remain important sources of spending on cloud computing, chips and networking equipment. <\/p>\n

A sharp deterioration in their financial prospects could still affect the companies supplying their infrastructure.<\/p>\n

The open AI models also remain heavily influenced by Chinese providers, despite efforts by Meta and Nvidia to strengthen the position of US-developed alternatives.<\/p>\n

What a lower Anthropic valuation could mean for AI investors<\/h2>\n

A scaled-back IPO valuation could weigh on sentiment if investors interpret it as evidence that expectations for AI growth have become excessive. <\/p>\n

The concern is particularly relevant amid a broader technology selloff that has hurt chipmakers, AI infrastructure companies and neocloud providers.<\/p>\n

CoreWeave’s recent share and bond declines illustrate the market’s sensitivity to the financing requirements of the AI buildout. <\/p>\n

A disappointing Anthropic listing could add to concerns about whether the sector’s enormous spending commitments can generate sufficient returns.<\/p>\n

Anthropic’s IPO is also important because investors increasingly view the anticipated listing, followed by a potential OpenAI offering, as a test of demand for major AI companies in public markets.<\/p>\n

Yet a lower valuation could also represent a more cautious pricing of future growth, rather than the collapse of the AI investment thesis. <\/p>\n

At $1.5 trillion, Anthropic would still command an enormous valuation for a company founded in 2021.<\/p>\n<\/p>\n

The post Anthropic\u2019s IPO Valuation cut: is it bad news for AI bulls?<\/a> appeared first on Invezz<\/a><\/p>\n

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Anthropic’s potential initial public offering is facing an early test of investor appetite, with some prospective and existing investors reportedly considering a valuation of around $1.5 trillion, below the roughly $2 trillion target previously expected for its November listing. The reassessment follows a slowdown in the company’s sequential revenue growth and comes as investors grow increasingly…<\/p>\n","protected":false},"author":1,"featured_media":3099,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[3],"tags":[],"class_list":["post-3098","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-investing"],"_links":{"self":[{"href":"https:\/\/retrotradingreport.com\/index.php\/wp-json\/wp\/v2\/posts\/3098","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/retrotradingreport.com\/index.php\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/retrotradingreport.com\/index.php\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/retrotradingreport.com\/index.php\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/retrotradingreport.com\/index.php\/wp-json\/wp\/v2\/comments?post=3098"}],"version-history":[{"count":0,"href":"https:\/\/retrotradingreport.com\/index.php\/wp-json\/wp\/v2\/posts\/3098\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/retrotradingreport.com\/index.php\/wp-json\/wp\/v2\/media\/3099"}],"wp:attachment":[{"href":"https:\/\/retrotradingreport.com\/index.php\/wp-json\/wp\/v2\/media?parent=3098"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/retrotradingreport.com\/index.php\/wp-json\/wp\/v2\/categories?post=3098"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/retrotradingreport.com\/index.php\/wp-json\/wp\/v2\/tags?post=3098"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}