Anthropic's IPO Range Values It Near $1 Trillion, With $26 Billion More From Its Suppliers

Anthropic expects to price its initial public offering between $70 and $78 a share, according to its second amended S-1, filed on November 10. The company is selling 801.4 million new shares and existing holders another 23.6 million, for 825 million Class A shares on the Nasdaq under the ticker ANT. At the $74 midpoint that is about $61 billion, second only to the $75 billion SpaceX raised in June, even if the underwriters sell every extra share at the top of the range.

The filing also adds a $26.0 billion private placement. AMD, Broadcom, Google, Micron, Microsoft, Nvidia and TSMC have agreed to buy non-voting Class N shares at the IPO price, closing right after the offering, and Google's purchase funds part of an investment it had already committed. Counting the 13.09 billion shares the filing expects to be outstanding afterward, $74 values Anthropic at about $968 billion, and the shares sold in the IPO are only 6.3% of that count.

That share count leaves things out. It excludes 1.77 billion stock options with an average exercise price of $2.91 and about 1.07 billion restricted stock units that have not vested. Adding them gives about 15.9 billion shares, or roughly $1.18 trillion at $74. CNBC reported in October that Anthropic was seeking $1.5 trillion to $2 trillion, as we noted then. Even fully diluted, the range comes in below that.

Anthropic expects net proceeds of about $84.6 billion from the offering and the placement, or $93.7 billion if the underwriters buy all 123.75 million extra shares they have an option on. That lands on top of the $131.8 billion in cash and short-term investments it held on September 30, per its first amendment. The stated uses are general corporate purposes, including compute, infrastructure and hiring. About $3.8 billion goes to tax withholding on restricted stock units that settle at the offering, and that settlement brings about $14.2 billion of stock-based compensation expense with it.

Public buyers get votes but not control. Class A shares carry one vote each. The 5.66 billion Class N shares, held mostly by strategic partners, carry none. A single Class F share held by an LLC of the seven co-founders carries 50.1% of the vote, and the Long-Term Benefit Trust's one Class T share elects a majority of the board. Anthropic will be a controlled company under Nasdaq rules.

Several of the seven placement buyers also sit across the table from Anthropic's compute bill. Its first filing listed at least $114.5 billion of commitments with Google, $44.9 billion with Microsoft and more than $20 billion expected with AMD, and its equipment leases with Broadcom carry about $161.2 billion of rent. The placement shares are not covered by the underwriters' 180-day lock-up, though they are restricted securities that cannot be sold freely. Directors and their affiliates have indicated interest in buying up to $303 million of Class A stock in the offering.

Amazon, the other big compute partner, is not in the placement. About $579.3 million of its convertible notes turn into 276.8 million Class N shares at the offering, the most it can take without crossing an ownership cap.

The float will be thin at first. Directors, officers and the holders of substantially all of the stock, about 15.5 billion shares counted as Class A, are under lock-up or market standoff agreements. For the first months, the 825 million IPO shares, plus any the underwriters add, are most of what can trade.

On price, $968 billion is about 14 times Anthropic's third-quarter revenue of $17.0 billion, annualized. Against that sit $895.4 billion of compute commitments, about $69.8 billion of them due within a year.