By A sharp selloff in technology stocks could threaten to derail one of AI’s most anticipated public listings.
Anthropic’s proposed $100 billion IPO, which was expected to value the company at around $1.5 trillion, is reportedly facing growing uncertainty as prospective investors question whether the artificial intelligence startup can proceed with its planned roadshow next week and complete a November listing.
The IPO is reportedly also facing growing resistance from prospective investors demanding a lower valuation.
Investors are seeking a more attractive valuation to commit to the offering, with some viewing the recently discussed $1.5 trillion valuation as being at the higher end of expectations, Reuters reported, citing four people familiar with investor discussions.
The Wall Street Journal also reported that major investors are increasingly skeptical that Anthropic’s blockbuster IPO can proceed at the expected valuation following the deep market selloff linked to the unwinding of artificial intelligence-related investments.
The roadshow was initially expected to begin in the week of November 9, with pricing anticipated the following week, Reuters previously reported.
However, the Nasdaq Composite fell as much as 5% on Thursday following a technology sector rout that rattled major equity indexes.
The selloff has raised questions about investor appetite for AI-related assets after a prolonged period of enthusiasm around the sector.
“Anthropic IPO was supposed to come week after next, the week before Thanksgiving. Unless the market manages a miraculous recovery here in the next 10 days, I think it’s extremely likely that Anthropic IPO is going to get pushed back. And whether that gets pushed back to December or they just do a private kind of offering and then push it back into next year is something that we will see how quickly the market recovers from here,” Arvind Sanger, managing partner at Geosphere Capital, told CNBC-TV18.
Anthropic valuation faces growing investor resistance
The proposed $1.5 trillion valuation is emerging as a key sticking point in discussions with prospective investors.
Three major investors planning to participate in the IPO believe the valuation will probably need to come down, with one suggesting it could be closer to $1 trillion, the WSJ reported.
Anthropic may also have to offer a bigger discount to secure investor commitments, particularly given its quarterly losses and substantial financial commitments to partners involved in building out AI infrastructure, Reuters reported.
The company could alternatively raise less than the anticipated $100 billion, with one investor expecting the offering could be closer to $80 billion, WSJ said.
The same investor hopes Anthropic will have well over $200 billion on its balance sheet after the IPO.
The valuation debate marks a shift from the enthusiasm that had surrounded the proposed listing for months.
Investors had viewed Anthropic as a “must-own” name, even as other AI-related stocks came under pressure.
Some prospective investors, however, are waiting to examine the company’s October financial results before pushing for a valuation reduction.
Anthropic’s revenue run rate, a metric used to estimate annual revenue based on its current performance, topped $80 billion at the end of October, up from the previous month, the WSJ reported.
Investors are also awaiting the company’s October revenue figure, which was left blank in its updated S-1 filing, to determine whether the AI startup has managed to accelerate growth following a slowdown in recent months, two people familiar with the discussions told Reuters.
Market selloff threatens November listing timeline
Even if Anthropic and its investors agree on a valuation, broader market conditions could ultimately determine whether the company proceeds with the IPO before the end of the year.
The political environment has also added to investor concerns.
Policy changes, congressional gridlock and growing opposition to AI infrastructure and data centre construction have emerged as potential risks following Democrats’ sweeping gains in the midterm elections.
The success of ballot initiatives in several states seeking to restrict data centre development has further highlighted the political challenges facing the AI industry.
If market conditions remain unfavourable, Anthropic could decide to postpone the offering until investors are more willing to absorb a transaction of its expected scale, Reuters reported, citing people familiar with investor discussions.
Persuading institutional investors to take substantial exposure to the AI sector could also prove difficult so soon after they have suffered losses in the recent selloff, even if markets recover in the coming days.
Anthropic executives and their advisers are expected to meet in the coming days to discuss the IPO plans.
The company has avoided committing to a specific timetable throughout the process to preserve flexibility, the WSJ reported.
Prediction markets reflect growing uncertainty
The uncertainty surrounding the listing is also visible in prediction markets, where traders have sharply reduced their expectations of an imminent debut.
On Polymarket, bettors are assigning a 29% probability that Anthropic will not complete an IPO before November 30.
Those odds have increased by 11 percentage points since Wednesday.
The probability of the company launching its IPO on or before November 18, which stood at 50% towards the end of October, has fallen to 10%.
Meanwhile, Kalshi puts the probability of an Anthropic IPO taking place before the end of the year at 69%.
Anthropic publicly filed its Form S-1 registration statement with the US Securities and Exchange Commission on October 26. Its Class A common stock is expected to be listed on the Nasdaq Global Select Market.
However, the company has not announced an official trading date or IPO pricing, leaving room for changes to the anticipated timetable.
Anthropic IPO could have wider implications for AI stocks
The uncertainty surrounding Anthropic’s listing extends beyond the company itself, given its extensive financial and commercial relationships with some of the world’s largest technology companies, including Google, Amazon and Nvidia.
A potential postponement could therefore have implications for both private and public market investors, many of whom have significant exposure to the broader AI ecosystem.
A successful listing would provide an important benchmark for the valuations investors are willing to assign to leading AI companies.
It could also offer an indication of whether public markets are prepared to finance the industry’s enormous capital requirements.
Conversely, a delay could reinforce concerns that the enthusiasm surrounding AI investments is beginning to weaken as investors scrutinise valuations, capital expenditure and the path towards profitability.
The potential consequences are particularly relevant for companies financing the AI infrastructure buildout through borrowing and large capital commitments.
A prolonged deterioration in market sentiment could make it harder for AI companies to raise fresh equity capital at attractive valuations.
Companies relying heavily on debt to finance data centres and computing infrastructure could also face greater pressure if projects are delayed or expected returns take longer to materialise.
For now, Anthropic’s executives have several options, including proceeding with a lower valuation, reducing the size of the offering or postponing the listing.
The company’s eventual decision could become an important test of whether the recent AI stock selloff represents a temporary correction or a more sustained reassessment of the sector’s investment prospects.
AI disclosure: AI tools assisted with research and drafting of this piece. An Invezz editor reviewed the facts, sources and wording before publication. Any opinions or analysis are Invezz’s, not those of an automated system.
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