Anthropic reported a 50% increase in revenue to $16.8 billion as it prepares for its IPO

Anthropic, the world’s most valuable artificial intelligence startup, told investors that its revenue grew by 50% in the third quarter to $16.8 billion, the Financial Times reported, citing sources. In addition, the company claims it has posted adjusted profits for the second consecutive quarter. On Wednesday, October 14, Anthropic gathered investors at its San Francisco office for a full day of presentations in preparation for an IPO that could break SpaceX’s record and become the largest in history.

Anthropic's revenue rose from $11.5 billion in the second quarter, but this growth was slower than the pace seen earlier in the year, according to the FT. In the second quarter, the startup’s sales more than doubled compared with approximately $4.8 billion in the first quarter.

Anthropic’s operating margin in the third quarter was 11%, according to sources cited by the Financial Times. They said the company also reported positive free cash flow and generated $1.7 in revenue for every dollar spent on computing power. Chips and data centers—which are necessary for training and running its models—remain the company’s largest expense categories.

Anthropic declined to comment to the Financial Times.

Anthropic’s leadership devoted the presentation to explaining how the company’s safety-first philosophy, rapid growth, and increased efficiency are positioning the startup for a successful IPO in November, the FT reports. Investors were anxiously awaiting the release of Anthropic’s financial results, the newspaper reports. Market participants view Anthropic’s metrics, alongside those of its competitor OpenAI, as a key indicator of whether the company can continue to ramp up spending on the infrastructure underpinning the AI boom.

Anthropic's current valuation stands at $965 billion, and its initial public offering could become the most expensive in history. In the prospectus, which Reuters previously reviewed, Anthropic is aiming for a valuation of over $2 trillion.

The FT notes that investors’ assessment of the company is complicated by a series of incidents involving AI models “hacking” systems in recent months, as well as mounting warnings about the risks of the technology—a concern shared by Anthropic CEO Dario Amodei, among others. In an early version of the IPO prospectus, which was circulated among a select group of investors last month, nearly a third of the document was devoted to risk factors, including the possibility of unpredictable and dangerous behavior by the models, the newspaper added. According to Reuters’ calculations, 80 of the 261 pages in the main body of the final prospectus are devoted to risks, compared with 48 pages describing the business.

Wall Street is also grappling with more traditional questions about whether Anthropic can maintain its high growth rate amid intensifying competition from OpenAI, Meta, and other players. Rising interest rates and a more challenging macroeconomic environment could also slow the company’s plans to spend more than $500 billion on infrastructure and computing power over the next decade.

According to The Wall Street Journal, despite expectations of an October offering, the IPO will likely take place after the November U.S. midterm elections: some of Anthropic’s advisors believe the company will be able to draw on its third-quarter results by that time. The startup has chosen the Nasdaq as the exchange for its listing.

This article was AI-translated and verified by a human editor