Anthropic IPO Faces Chilly Reception: Investors Demand Valuation Cut to $1 trillion, October Annualized Revenue Just Broke $80 billion

Beating AI News Flash: After the tech stock sell-off, Anthropic's IPO is beginning to face valuation pressure. The Wall Street Journal reports that three large institutional investors planning to participate in the IPO believe the previously expected $1.5 trillion valuation is still too high, with one of them suggesting it should be lowered to about $1 trillion.

But Anthropic's revenue is still growing rapidly. Sources familiar with the matter say that by the end of October, the company's annualized revenue run rate had exceeded $80 billion. That figure had just surpassed $65 billion at the end of July, rising another notch within three months.

Investors also have differing views on the listing plan. Some want to wait for the October financial report before deciding whether to accept a valuation cut; one investor believes Anthropic could reduce the fundraising size from the previously expected $100 billion to about $80 billion; other investors have suggested that if the market remains sluggish, it would be better to postpone the listing and wait for conditions to improve.

These are only opinions that potential buyers are signaling to the company; the final decision still rests with Anthropic and its underwriters. But if large institutions are unwilling to subscribe at the original valuation, Anthropic will have to reconsider the issue price, fundraising size, and even the timing of the listing.