Anthropic Intends to Trade on the Nasdaq Under the Ticker ANT
Just after the two biggest initial public offerings (IPOs) ever — Space Exploration Technologies and SK Hynix — Anthropic is preparing its own IPO, which is expected to be even bigger than both.
The company has been discussing plans to go public for some time. It filed its prospectus this past week. Could this be a great investment opportunity?
Why everyone is so excited
Anthropic was founded in 2021 by former OpenAI employees who disagreed with how artificial intelligence (AI) should be developed. They created the popular Claude AI model. Since then, the company has become one of the most important voices in the AI community.
Image source: Getty Images.
After months of rumors about its plans, Anthropic filed a prospectus this week. The document explains how the company works, its finances, its risks, and its opportunities. However, the company has not announced an IPO price yet. The prospectus also leaves out several important details, including how the company performed in the third quarter.
Even so, the information in the prospectus is interesting and exciting, and it raises some important questions. One especially exciting part is the company's recent growth. In the second quarter, its revenue was nearly 15 times higher than it was in the same period a year earlier, reaching $11.6 billion. The company said it has 11,900 different customers who each pay at least $100,000. It also has 1,900 customers who each pay at least $1 million.
Anthropic reported $974 million in operating income in the second quarter. This means it moved from reporting quarterly operating losses to making an operating profit. However, its net loss grew to $66 billion. This figure included a non-cash charge connected to some of the money it raised in private funding rounds. In other words, its main business is making money, but other financial commitments are reducing its profits for now.
The company's leaders have an ambitious goal. They believe their technology can solve major problems around the world and make life better. At the start of the prospectus, they wrote: "We believe that AI is one of the most consequential technologies in human history. If managed well, it could rapidly accelerate scientific innovation, greatly increase economic growth rates, bring cures for major diseases within reach, and solve problems that have resisted generations of human effort."
94 pages of risks
Pay attention to the words "if managed well." The prospectus includes 94 pages describing possible risks. There are many dangers, including risks to humanity. The company identifies one major concern: "Our AI models may behave in unintended, misaligned, or autonomous ways, including by taking harmful actions that no user or third party directed." In simple terms, its AI systems might act in unexpected ways or do harmful things without anyone telling them to.
Other risks fit into several groups. They include challenges in making better AI models, strong competition, the high computing costs needed to develop and run its technology, and the fact that company leaders hold much of the voting power. The prospectus lists many other risks as well.
Anthropic has not set a price for its IPO yet. It will likely decide on one after meeting with potential investors during its upcoming IPO roadshow. That price could be an important factor for investors who are still unsure whether to buy shares.