Anthropic IPO Faces Uncertainty as Investors Push for Lower Valuation

Artificial intelligence giant Anthropic may be forced to lower its expected valuation ahead of its highly anticipated stock market debut after a sharp technology sector sell-off rattled investor confidence.

According to a Wall Street Journal report, the company had been targeting a valuation of around $1.5 trillion for its initial public offering (IPO), which is expected during the week of 16 November. Anthropic had also been seeking to raise as much as $100 billion, a figure that would make it the largest IPO in history.

However, growing concerns over the massive levels of investment flowing into the AI sector are prompting investors to reassess their expectations.

Three major investors expected to participate in the offering told the Journal that Anthropic may need to lower its valuation significantly. One investor suggested the company could be valued closer to $1 trillion, below earlier estimates that ranged from $1.5 trillion to $2 trillion.

The report also noted that a postponement of the IPO remains a possibility, while reducing the size of the offering is another option being considered.

Anthropic did not immediately respond to a request for comment from AFP.

The planned listing is being closely watched by global markets due to the company's deep ties with major technology firms, including Google, Amazon and Nvidia. Analysts say the outcome could serve as a key test of investor appetite for AI-related investments.

The uncertainty surrounding Anthropic's IPO comes as rival AI firm OpenAI has already pushed back its own Wall Street debut until next year.

Investor sentiment toward the sector took a hit on Thursday, with companies in the Nasdaq Composite collectively losing an estimated $2.5 trillion in market value as traders pulled back from AI-focused stocks.

Anthropic's offering had been expected to eclipse the previous IPO record set by SpaceX in June, which raised $86 billion.

(With AFP)