3 Important Things to Know About AI Giant Anthropic Ahead of Its Possible November IPO
Anthropic started the process of going public in June, when it filed its confidential S-1 with the Securities and Exchange Commission (SEC). While it was originally expected to conduct its initial public offering (IPO) in October, reports indicate that it recently pushed its listing back to November.
The rapidly growing artificial intelligence (AI) lab is seeking to raise up to $100 billion at a share price that would give the company a $2 trillion market cap. That would make its IPO the largest in history, ahead of Space Exploration Technology‘s $1.77 trillion listing in June. Here’s what investors should know about Anthropic before it goes public.
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1. It’s one of the fastest-growing software companies
Anthropic’s annualized run rate (ARR) has skyrocketed in less than two years. It started 2025 with an ARR of $1 billion. That rose to $9 billion at the end of last year, hit $47 billion by May, and was $65 billion at the end of July, according to Anthropic.
Over about seven months, Anthropic increased its ARR more than sevenfold. It’s now ahead of rival OpenAI, which hit an ARR of $40 billion at the end of July. And it reportedly expects its ARR to exceed $110 billion by the end of 2026. That rapid growth is one of the reasons people are excited about investing in Anthropic.
2. Projected revenue is lower than annualized revenue, and that affects Anthropic’s valuation
Anthropic would be going public at about 18 times sales, if you take its expected ARR of $110 billion against a market cap of $2 trillion. That’s a high valuation — the S&P 500 trades at about 3.8 times sales as of Sept. 28 — but well below that of SpaceX, which trades at 92 times trailing sales.
However, although ARR is a useful metric, it’s not the same as revenue. ARR is a metric that takes the most recent monthly sales figure and multiplies it to reflect what a full year of theoretical revenues at that rate would be. Revenue is a company’s actual sales over a specific period. Trade periodical R&D World estimates that Anthropic’s actual revenue for 2026 will be around $60 billion. A market cap of $2 trillion would therefore give it a valuation of 33 times sales. Investors will be paying a hefty premium for this company’s growth.
3. Anthropic is locked into expensive compute contracts
Developing frontier AI models requires significant computing power, and Anthropic is investing heavily to lock in access to it. In May, it announced a deal to pay SpaceX $1.25 billion per month through May 2029 to use the Colossus 1 data center, a commitment that comes out to $15 billion per year. In August, it entered into a six-year, $44.6 billion cloud agreement with Nscale. That comes to about $7.4 billion per year.
If its revenue continues to rise, Anthropic should be able to keep ahead of its expenses. If its sales slow, that’s when Anthropic’s compute commitments could lead to financial difficulties.
Given investors’ appetite for AI stocks, it’s no surprise that the Anthropic IPO is drawing substantial attention. While its rapid growth is the big story, this will likely be an expensive and volatile stock when it goes public, so if you’re interested in it, carefully consider whether it fits your portfolio and your risk tolerance before buying.
