Anthropic IPO: The Truth About Its $80 Billion Loss.

Anthropic, the company behind Claude, just filed to go public. This could be one of the biggest stock debuts in history, maybe worth over $1.5 trillion or pushing $2 trillion, but hidden inside its official filing is a jaw-dropping number. You ready for this? A loss of nearly $80 billion, not in a year, in six months. It sounds terrifying, right? Well, that number is not what it looks like. And the real story is honestly wild. There's even a twist involving our great friend Elon Musk's SpaceX. So let's start with the facts everyone is desperate to know. On October 26th, Anthropic officially filed the paperwork to sell its shares to the public. That paperwork is called an S-1. Now, here's what's confirmed. The stock will trade on the NASDAQ under the ticker symbol ANT. And the big banks running the deal are Goldman Sachs and Morgan Stanley. But. Here's what's surprising. A lot is still a mystery. The exact IPO date, not officially announced. Reporting suggests that it could start around the week of November 16th. The price per share, not disclosed yet. The number of shares being sold, not disclosed yet. So if anyone tells you the exact price today, they're purely guessing. We're gonna have to wait for an updated filing to get the real number. Right now, leadership is on their roadshow. That's where they go in, they make their sales pitch, and they pitch the stock to the big investors. Guys, I want to remind you, when a company goes public, their job is to advertise the out of that company to get the highest valuation prop that they possibly can. It is a sales show. Now, as for the valuation, the big one everyone wants, the last time Anthropic's value was officially confirmed, which was back in May. It was raising money at a valuation of $965 billion, but reports now suggest that the IPO could value the company somewhere between $1.5 and $2 trillion. Now, $1.5 trillion looks like the more likely target according to what the media is reporting, but either way, we're talking about one of the most valuable companies ever to go public. Reporting also suggests the offering itself could raise around $100 billion or more. Now, I want to make sure I explain this well. You might be sitting there saying, well, wait a second. If they're going public at 1.5 trillion, how is the raise only 100 billion? Well, they're not going to issue all the shares publicly. They're just going to issue some company shares or some new shares to get some money in. And that total value will be around $100 billion. So remember, the money a company raises and the total value of the whole company are two very different things. So guys, this is like if you had your home. And it was worth $500,000 and you just wanted to sell 20% of your home to your neighbor for whatever reason to raise some capital, you'd raise $100,000. So you got $100,000, but it was based on a value of $500,000. You sold 20% of the company. That's all they're doing here. So what does Anthropic even do? Well, guys, it builds Claude, a powerful AI that companies use for writing, researching, and especially coding. It was founded back in 2021 by a group of former OpenAI ChatGPT researchers. They were led by the siblings Dario and Daniela Amodei. It's also building tools like Claude CoWork aimed at handling bigger work tasks, not just answering questions. In plain terms, Anthropic doesn't sell a box of software. It sells intelligence charged by the task, and it makes its money in three main ways. First off, subscriptions. You pay a monthly fee to use Claude, a bit like paying for Netflix. Second, and this is the big one, usage. Businesses plug Claude directly into their own software and pay based on how much work the AI actually does. And third, they have newer tools like Claude Code, which can actually write and fix software almost entirely on its own. Guys, I was just driving yesterday home from work. I remember thinking to myself like, We used to have to Google things just two, three years ago to find answers. Now, Claude and OpenAI do all of that for you. It just, it finds the answer for you in the internet once you type in the question. I actually, two years removed thinking to myself, how did we not have AI all this time? Like, how did we function without it? That just goes to show how much we can take for granted that technology changes so quickly and changes our lives so quickly Now, here's the fascinating part. About 80% of Anthropic's money comes from that pay-as-you-go usage. Only about 20% comes from the flat subscriptions. So why does that matter so much? Guys, because it's a great sign that customers are genuinely using it a ton. But it's also less predictable. If a customer finds Claude incredibly useful, their spending can explode. But if a cheaper AI comes along, that spending could shrink just as fast. One more thing. About 72% of its money comes from U.S. customers, so there's a whole big world still left for it to grow into. This is a business that's built on real, measured customer activity, people paying for actual work getting done. Okay, now let's get into exactly why everyone's so excited, because the growth here is absolutely insane. In all of last year, Anthropic brought in about $4.6 billion. But in just the first half of this year, it brought in $16 billion. That's more than three times its entire previous year in a matter of six months. And it's not just hobbyists messing around. Big companies are piling in. The number of customers spending over $100,000 a year jumped from 1,500 to literally 12,000 and under a year. More than half of the giant Fortune 500 companies are now serious spenders. At the very top, there are around 250 companies that are each Spending over $10 million a year. Guys, that's $2.5 billion right there if they all spend $10 million each. But some of them are spending more than that. And the great part is not a single customer makes up more than 10% of its sales. So it's not like it's one of those companies like NVIDIA that has five or six companies that make up half or 60% of its sales. It is not dangerously dependent on any one company. Here's a mind-blowing fact. Its existing customers are now spending roughly nine times as much as they were a year ago. One honest note though, Anthropic measures that nine times number in a very narrow way. And Anthropic itself openly warns. That this rocket ship growth will slow down as it gets bigger. But even if it slows down a lot, this is still one of the fastest growing businesses the world has ever seen. Now, the number that's scaring everyone, that nearly $80 billion loss, let me clear up two huge misunderstandings right away. First, that loss was not just for last month. It was for the entire first six months of the year. And second, and this is the big one, Anthropic did not burn $80 billion in cash, not even remotely close. So where did the giant loss actually come from? It's one of the strangest things in the entire filing. Anthropic borrowed money from Amazon using something called convertible notes. These are basically loans that can later turn into stock. And here's the weird accounting rule. When Anthropic's own value skyrocketed, these notes became a lot more valuable as well. And the rules forced the company to record that increase as a massive expense. So around $72 billion of that $80 billion loss was actually caused by Anthropic becoming more valuable. It's a paper loss, not real money leaving the building. And here's the proof. If you strip out all that accounting noise, Anthropic's real day-to-day operating loss was only about $693 million. That's tiny for a company this large. In fact, on an adjusted basis, The core business actually earned a profit of around $1.6 billion. And get this, its actual cash flow turned positive, bringing in nearly $4 billion. That terrifying headline is hiding a far healthier business underneath. And one honest asterisks, Anthropic also paid its employees over $2 billion in stock. That doesn't cost cash, but every new share handed out makes the owner's slice a little bit smaller. So we always have to keep an eye on that too, even after they go public, to see how they're issuing stock to new employees. The lesson is always, read past the scary headline number. Now, quick update before we keep going. We recorded this video before Anthropic changed its filing. On November 2nd, they put out a new version, and there are some new numbers that you need to know. First, the good news. Revenue for the summer quarter came in at about $17 billion. That's a lot of money coming in the door. Now, here's the part that made me stop. Anthropic has signed up for about $895 billion in deals to pay for computers and data centers. And almost $70 billion of that comes due in the next 12 months. Now, that's not money they owe today. These are promises to pay over time. They're IOUs. And as we learned in Dumb and Dumber, IOUs are just as good as money. But it's a big bill, and somebody has to pay it. And here's what's still missing. The price. They still haven't told us what the stock is going to cost per share. So everything in this video still holds up, but remember, even a great business can be a bad buy at the wrong price. And until we know the price, we can't tell you whether we think it's worth it or not. But guys, don't relax just yet. There's a very real risk buried in this filing, and it's all about spending promises. First, let's untangle three numbers that people constantly mix up. Anthropic's actual debt is only about $6 billion. A different, scarier-looking number is $108 billion, and that's just the accounting value of all those convertible notes. It's not a real loan that it has to pay back in cash. But the number that truly matters is the third one, the mountain of money Anthropic has promised to spend on computing power. To run Claude for millions of users, Anthropic needs enormous amounts of computing. So it's signed a long-term deals to buy it with Google, Amazon, Microsoft, Broadcom, SpaceX, and many others. Add them all up and you get roughly $637 billion stretched out over many years. The single biggest promise is $161 billion to the chipmaker Broadcom. Google is next at about 114 billion. Now, guys, if you're really interested in learning more about this and everything I've talked about, I actually have an absolutely free PDF where we break down Anthropic and the things we talk about in this video. Click the link below and you will be able to download it immediately and it'll include the full list in the PDF so you don't have to write any of these down. All the details in the S-1, everything about this IPO that we have put in there is in the PDF, so go check it out right away if you're interested in learning more about this Anthropic IPO. And guys, that spending, there's tens of billions more in possible chip spending on top of all this. These are different types of promises, so you can't simply stack them all together. But the message is loud and clear. Anthropic is betting hundreds of billions of dollars on its own future. These are not bills due tomorrow. They're long-term deals. But here's the danger. Anthropic may have to pay a big chunk of that whether or not it actually uses all that computing power. If its growth ever slows down, those promises could suddenly become a very heavy weight around its neck. But here's the twist that I promised you in the beginning. One of those computing deals worth up to $120 billion is with SpaceX. That's right. Anthropic is paying Elon Musk's company for computing power, even though SpaceX runs its own competing AI. Once that deal is fully running, it could mean roughly $3 billion a month flowing into SpaceX coffers. It's a strange, tangled web, and it's the perfect reason to look at exactly what's happened to SpaceX stock this year. But first... Who's really running this thing? Before we go further, there's one more thing every potential buyer absolutely needs to understand, and it's a big one. Who actually controls this company? When you buy Anthropic stock, you're buying a slice of the business, but you get almost no say in how it's actually run. Here's how it works. The seven founders have set up a special class of shares. It gives them 50.1% of the voting power, just over half, even though... They don't own half the company. And this is a very common theme. I remember when Meta went public, Zuckerberg was attacked for doing that exact same thing. He didn't own over half, but he owned like 80% of the voting shares. Now, on top of that, a special trust gets to pick most of the people on the board of directors. That trust is designed to keep the company focused on safe, responsible AI over the long haul. There are actually five different classes of stock, each with different rights, and the company is set up as a public benefit corporation. That's a fancy way of saying it's legally allowed to balance doing good for the world against making money for shareholders. Now. That setup might genuinely help Anthropic make smart, safe, long-term decisions. But for you, the regular investor, it means something very important. You're basically a passenger on this ride, not the driver. And on top of that, if you disagree with how the company is being run, there's very little you can actually do about it, even if you got every investor with you on your side to do something about it. This is very different from a normal company where owning shares usually comes with a real vote. Based on your percentage ownership. And on top of that, if they think something is better for the world versus your pocketbook as an investor, they can sit there and say, yeah, we don't care. We're going to do what's best for the world. Now you might sit there in your high horse going, well, I'm all in favor of that. I always hear that until I see people's stock go down and they're like, yeah, get me that money. So now let's zoom way out and talk about IPOs in general. There's a pattern here that could be generally saving you a lot of money. An IPO is merely the first time a company sells its shares to the public. They're exciting as hell, but here's the trap. Before you can even buy in, big investors have often already bought their shares at a much lower price. And then on day one, all the hype can send the price skyrocketing up. That's wonderful for those early insiders, but it means that you might be buying in a badly inflated price. Think of the typical path. First, private investors buy in early and cheap. Then the bankers set an official starting price. And finally, the public excitement can shove the opening price way above that. That rewards the insiders far more than the latecomers. And guys, the long-term track record of IPOs is quite a sobering number. A respected professor named Jay Ritter has studied decades of IPOs. On average, a newly public stock pops about 19% on its very first day. That sounds amazing, but measured from that first day price, the typical IPO has actually lost about 26% over the following three years. In fact, more than half of all IPOs end up flat or negative over three years, and most of them will trail the entire market. And here's the part that should really matter for Anthropic. The research shows that the most expensive stocks, the ones that are priced sky high compared to their sales, tend to do the very worst of all. But remember, that makes sense based on what we teach. The more you pay for something, the less your return. So this leaves you with two completely separate questions. Number one, will Anthropic become an amazing, world-changing, successful business? And number two, will you actually make money buying it at the price that it opens at? Those two questions can have completely different answers. Now, guys, reminder, never take our title or thumbnail literally. We are never here to give a stock tip. We're here to teach a process that you can one day take and apply to your own investments. We are looking for people who want to learn how to fish, not the ones who want us to give them fish because we're never going to do that. And guys, when it comes to IPOs, we don't have to guess what that looks like. We have a perfect real-time example from just a few months ago, SpaceX. It went public back in June, and its stock has been an absolute rollercoaster ever since. Just watch this ride. It started at $135 a share. On day one, it shot up to about $161. Within a single week, it peaked at near $202. Then it came crashing all the way down to $108. And today, it sits a little bit below $150. So let's look at who won and lost here. If you bought it right at the $135 starting price, you're up a little bit today. But if you got swept up in the day one hype and bought near 202, you're down about 26%. And just this October, the stock jumped almost 8% in one day, then dropped over 9% the very next. That's a stomach-churning ride. But here's the crucial part, and it's the exact same lesson waiting for Anthropic. SpaceX's actual business is doing phenomenal, with its Starlink internet and its AI both exploding. But last quarter... SpaceX revenue jumped 161% and the company was solidly profitable. The company itself is strong, and yet the stock still whipped people around and burned anyone who overpaid near the top. A great business can have a brutal stock. That gap is the entire point. And remember, these two companies are now directly linked since Anthropic is one of SpaceX's biggest computing customers. So keep SpaceX firmly in mind as you think about buying an Anthropic. And I want to remind everybody, Here's a chart from 1995 to today showing Cisco's price. Cisco was the company of the dot-com bubble. It was the Anthropic. It was the SpaceX. It was the Tesla of It was the NVIDIA of 1999 and 2000. But what's interesting is the stock peaked in August of 2000 at around $82 a share. From that point until August of 2025, the stock went nowhere. But the revenue and profit... Went up two to three times on revenue and I think four or five times on profit. The company was a better company 25 years later, and the stock was flat the entire time. Why? Somebody paid too high a price, even though the business fundamentals did get better. Because if you bought in August of 2000, and I came back in time and said, guess what? Profit's going to be four or five times greater. You'd have been like, oh my God, I'm going to make a killing on this company. And you didn't. And it's not like the company was super cheap in August of 2025. It was selling for about what it was worth. That's the incredible part. Look, guys, the truth is that most people are going to lose money with stocks because they don't have a plan. They buy the wrong companies or, and this is what's more common, they buy the right companies at the wrong price because of hype. They sell it completely the wrong time because of fear. I used to do the exact same thing for years, and it really felt like the market was rigged to take my money. That was until I learned how to invest the right way. This is exactly why we built Everything Money, to help regular people like you step Stop guessing and start investing with real confidence. You're going to get our stock analyzer, our tools, our courses that teach you step-by-step. You're finally going to see the stock market through the lens of success, not fear, through the lens of an investor, not a speculator. Try it for seven days, you'll see. This isn't gambling, it's common sense. So now, back to Anthropic. Let's lay out both sides of Anthropic, focusing purely on the business itself. First, the bull case, the reason it could be a massive winner. One, it's getting deeply woven into how big companies operate. Once a business builds clawed into its software and trains its people on it, ripping it back out becomes a real headache. That makes for a very sticky customer. And Anthropic has built a strong reputation for safety and reliability, which big banks and hospitals really value and need. That trust makes those customers even stickier. AI that can actually do work, like writing computer code, opens up a gigantic new market. Companies could soon pay for AI workers instead of just a simple chatbot. And three, Anthropic's costs grew far slower than its sales. In one recent stretch, its revenue grew many times faster than its computing costs did. That's a beautiful sign. It means that as the company gets bigger, it could become much more profitable. But the bear case is every bit as serious. One, and it's the biggest worry. AI could become a commodity. That means everyone's AI ends up about the same. So customers just buy the cheapest. Guys, imagine back in 1999 and you had a company that said, we're going to make websites for you. That would have been revolutionary. How many companies right now will make a website for you? It's all over the place. It's become commoditized. You can go to one of dozens of online website makers. Hell, you can have now Claude and ChatGPT make your website for you. That's the amazing part. Anthropic is battling OpenAI, Google, and a flood of free OpenAI models. If they all become similarly good, a brutal price war could crush everyone's profits even as total usage keeps exploding. And guys, remember, that's a very common theme in technology. Back in 1996, a really good computer was $2,000 or $2,500. What was the power of it 30 years ago? And what do you get now for a $2,000 or $2,500 computer? Nobody's buying those things unless you're gaming. And even then, you can buy a good gaming computer for half that price. So just remember, technology can be commoditized very, very easily. Two, those enormous computing promises we talked about could outgrow the business. Three, it leans heavily on Google, Amazon, and Microsoft for computing. Those are the very same giants that also build their own competing AI. That's a risky thing to depend on. And fourth. AI can make mistakes. It can leak private data or trigger lawsuits. In fact, Anthropic already had to pay $1.5 billion settlement over copyright issues. One big public failure could badly damage the trust that it's built. And unlike a normal software company, Anthropic just can't build its product once and sell it forever. It has to keep spending, sometimes fortunes, on new models and computing just to stay in the race. So here's the one single idea that I want you to walk away with. Anthropic could generally become one of the most important companies in the entire world and its IPO could still burn investors who pay too much for it. Both of those things can be true at the same time. The real question is a much tougher one. Can Anthropic earn a good return on the staggering amount of capital and computing it has promised to buy? Honestly, nobody knows yet. So watch three things from here, whether it's cashflow keeps improving, whether it actually uses all that computing that it promised to buy, and whether Claude stays a favorite. And if you'd rather have stocks that you could actually buy or sell right now, not waiting around for an IPO, go watch this video next. It's right here in the corner. We looked at six stocks that analysts are saying to buy or sell, and we dive into what's true about analyzing them ourselves. Guys, the results are actually kind of surprising. So click right here on your screen. Thank you for your time.