There is a lot of value from LLMs but it is something that I can switch easily. Yes, some frontier models are much better but users can still chose to use cheaper models for most of the work. In fact most applications, through which people will interact with LLMs anyway, will not need frontier models unless they offer "chat with AI". Anything that solves specific problems (even multiple problems) does not need frontier LLMs.
Anthropic and OpenAI will have to become more of the end user application stack. Files, calendars, emails, photos, and much more have to pass through them for them to keep making money. Else they cannot make money like the way they have been in this early era of LLMs.
a big move into end-user software would mean that they have to compete heavily with their own largest customers. The economics of offering SaaS are also under meaningful pressure and don't warrant anywhere near the valuation that is being suggested
The biggest moat with applications like MS Office is compatibility. Sharing a slide deck or spreadsheet with others is a simple decision, you know they have it or have software that can read/write it.
I don't get the need to have Anthropic build their custom versions of MS Office apps, I can tell Claude to generate a word doc from a wiki page and it does a pretty damn good job. Anthropic's statistical median level of software that they had Claude create isn't going to replace Office apps to the point where companies cancel/stop renewing their MS Office subscriptions/licenses.
The other element is trust. Do end users trust their data in Anthropic's systems? A lot of people get creeped out when they search for content from one device in their household and then nearly instantaneously they start seeing ads from other devices on the same topic. How creepy will AI get if it starts consuming all your docs, spreadsheets, personal finance info, emails, etc.?
End-user software is going to be under a lot of pressure. If you're Microsoft, Apple, or Google: you can easily copy products or integrate ideas into their platform. I see companies like Adobe, Salesforce, and Oracle having to downsize significantly to stay profitable. Having said that, my in-laws still pay for an AOL email so I don't think their cashflow is going to zero soon.
Adobe seems to be in a tough spot, because so much of the lock-in is client side, I think Salesforce is fairly well protected, it's just so impossibly difficult to remove once a company has fully adopted it. Similar to the staying power of the ERPs of Oracle and SAP.
It's the same really. There have always been alternatives that can work with Adobe's various file formats. Even more aren't going to change much, at least for their enterprise key customers. This is not only the case for Adobe, but many others as well, e.g. MS office is still a thing these days, and so are things like 3Ds Max or Maya, albeit having many compatible cheaper or even free alternatives. It's not so much about features, pricing or even stability. It's about customer support. Do I want to ask an LLM and test my luck or write a GitHub issue and cross my fingers that someone will read it within the next weeks? No, I will pick up my phone or write a mail and get a response within hours if not minutes.
I ask my llm to write custom software and love the freedom to customize it to my needs. Today I do a presentation on Ubuntu with a new "Presenter" app that works offline, runs 100% in CUDA on GPU and streams videos, starts in 2 seconds, lets me demo robotics in 3D and Opus 5.5 wrote it yesterday. This may sound very unusual, but I think it will be common in the future: moats disappear one by one.
I would say that Apple's Create Studio can move toward feature parity faster with Adobe. My point if you're not a platform provider it's going to be harder to make a profit.
The big problem is Photoshop. I have no love for Adobe, I proudly moved my department off of all Adobe products a few years ago. I am a big fan of open source solutions and I am always impressed at what the GiMP team (and some others) have accomplished.
But…
Photoshop is king. By a solid decade. If you’re a professional the $40 a month or whatever it is now means nothing to you as well. Premier? Replaceable. Lightroom? Pretty replaceable though still somewhat ahead. Photoshop? There’s only one Photoshop. And as much as I’m loathe to give Adobe any credit, it’s the best by a mile. There are too many essential features in QoL things that other programs are missing.
Luckily my department doesn’t need it but if we needed more serious photo editing, we would simply have to accept Photoshop.
The risk for Adobe isn’t that we replace their software with some AI generated alternative. It’s that we bypass that class of software altogether and have an AI do the work.
> If you're Microsoft, Apple, or Google: you can easily copy products or integrate ideas into their platform
This argument doesn't hold water. Google tried like no one else to have a chat app and it failed miserably more than a handful of times. Same for social networks.
now imagine that said customer/competitors have been uploading/generating their source code, problem reports, marketing collateral, and other IP _to the LLM company_ for the last few years.
> Meanwhile, Google and Microsoft, which already dominate that area, seem to be dormant.
Google owns 15% of Anthropic I think.
And Google offers Argon 4 to paying Workspace and Google One customers now. How's what was the number 1 model on nearly every single bench a few weeks ago being "dormant"?
I know people all in in the Google ecosystem (getting credits from Android phones they buy etc.) who only swear by the Google models and who are now using Argon 4: I asked them and a few days ago they had access (but they were already using other Google models before that).
Doesn't GMail have billions account by now?
I'd tend to say with billions of users on GMail and a model like Argon and 15% of the Anthropic shares, Google is not where you think it is.
Easily in the context of the corporate world is to pay for something, that something gets installed and then just works, and if it doesn’t work there’s always someone you can call 24/7 to come and fix it. I don’t see how this is possible with open models.
the answer is to use a gateway that all the prompts go through. There are many proprietary and open source solutions for this. You get the benefit of making it trivial to switch between proprietary providers in case you are unhappy with the performance or squeezed on price. The AI Gateways put cap on LLM providers' margin upside.
Additionally, the gateway allows for caching, additional security checks, centralized monitoring. I think most corporations have a multi-provider setup anyway.
What do you mean? We use Bedrock at our company and I can switch to literally any model, including the open ones, by just typing /model and picking it, even including inside Claude Code. It's ridiculously easy to switch, and imho GLM 5.3 is good enough for 99% of my daily tasks already.
You pay a service provider, who manages the open models… there is absolutely nothing special about it. The hardware can be something you own. Or you rent. Or you just pay the service provider to access the open model apis. Lots of options here, it’s not different from pretty much any other software service in the corporate world
This is the same argument we have heard many times with SaaS that would presumably get replaced by open source equivalents. In practice it does not happen because there is a lot of value in having someone else deal with a problem.
I'm fascinated by exactly how an investment in the company that first reaches AGI (or whatever we decide to call it) might pay off... It feels like the stocks would absolutely be worth owning in the immediate term because they'd be hot property at the point where people realise it's happening.
The thing that I'm less clear on is, if and when they achieve some kind of recursive improvement exponential growth thingy, isn't that going to heavily disrupt the entire economy / stock market? In that environment, would Anthropic's stocks really be a good bet, given they have to operate within the economy?
> The thing that I'm less clear on is, if and when they achieve some kind of recursive improvement exponential growth thingy, isn't that going to heavily disrupt the entire economy / stock market? In that environment, would Anthropic's stocks really be a good bet, given they have to operate within the economy?
That's a long-term problem to be dealt with later, greed dictates to pursue the former as long as the music is playing and everyone is dancing. Similar to 2007-2008 when it was clear that things were breaking but the incentives were to play the game for as long as possible before it imploded.
It's clearer to me why this works for generic investors than for the AI companies themselves - unless their plan is just for key employees to cash out and live on a private moon just before Consequences arrive.
>> that first reaches AGI (or whatever we decide to call it) might pay off
It is a myth. They are chasing science fiction. They either dream of an omniscient overseer who will take control of society and nominate its shareholders-parents into the governing elite, or they envision a chatbot that will solve every problem, again turning shareholders into the power brokers. They forget that nobody will ever be allowed to "win capitalism" and take over the planet. Companies have are torn down for far far less. Every AI model is data, ones and zeros. It therefore can be copied/shared/leaked. Intellectual Property law is not a ladder for assent to lordship. It can and will be rewritten or outright ignored rather than allow capitalism to collapse.
> It feels like people are still trying to bet on the horse that will achieve gAI.
I think that at this point gAI is just a marketing blurb, and the actual race is to dominate current practical applications involving basic RAG and ReAct loops. This can go from anything between software development, business intelligence, and market research. A company whose top brass can use a team of agents to do what nowadays they assign to mid- and top-level management is an executive with tighter control over the whole business process. For this you don't need gAI.
Not only can you switch easily, they all seem to do the same thing, fail in the same ways, make the same bad linguistic choices, write the same code... I think at the end of the day, LLMs are a commodity. They're like a grease, or oil. They're trying all the tricks with branding cute names, version numbers, benchmarks, thinking levels, but it all just seems the same stuff to me: I put in tokens, I get more tokens back, and if I didn't know ahead I wouldn't be able to distinguish if they'd come from Anthropic or OpenAI or wherever. Maybe some people can but I can't.
„The IPO process begins with a roadshow starting on November 10th (EST). Subject to regulatory clearance, the final IPO share price is expected to be set on November 18th (EST), and shares are expected to begin publicly trading on November 19th (EST).“
So if share price is only set one day before trading, I guess you just have that day to decide to buy if you can get allocation from your broker? I'd like to try it but I've never bought an IPO before.
You indicate your interest. Also start funding the account. So you fund 7000 for 100 shares at 70. Then they announce the price is 75. You must change the order to fit the funds or have extra money. Of course you can opt out or change the quantity anyways. But I think in both the cases I actually went ahead (Reddit and figma), I had to reconfirm the quantity. You can't be away from the network.
To further emphasize this, it is very challenging to get in a pre-auction allocation.
You can submit an order via your broker (depending on the broker and your account) to the auction itself on the exchange once it’s in the quotation phase.
Not that I would advocate for that. Sometimes it’s better to buy in the secondary market once things settle a bit.
I got lucky in the Reddit ipo. I had decent karma so I got invited for their special insider track. But I had to create a new account via a link shared by Reddit. Got what I asked for.
The economics of this are absurd, and Anthropic hasn't been without their controversy; but I use Claude everyday, and they've made tremendous impact on society. I wish them the best for their IPO.
The way I see it, AI is more comparable to some sort of utility. Like electricity, internet, etc. - and should be priced that way. If we ever get to "true" AGI, and the open source models also get there, what's the moat? Access to compute could be the differentiator.
Already is the differentiator even with the models we have now which while having differences are mostly swappable for a lot of users/use cases.
For all that the local models have improved (and Qwen 3.8 27b is still impressing me) they aren't what you can run (or would run) if you have an entire data centre stuffed with H200's.
All this does is further widen the divide we already know exists by those with access to resources using them to increase their access to resources and those without getting to watch because there isn't much they can do without resources.
I was of the same opinion but the main difference is that models get better which I am not sure you have a correspondent in utilities (what would get better?). The barrier of entry in utilities is capital. Here there seems to be more. Why is Grok behind and why is Gemini so ... what's the word? If models progress reach the RSI point there is no parallel to utilities imo.
This is pretty much false. There's a lot of art and technique that goes into creating a model. A model is also clearly not fungible - it has certain characteristics and behaves a certain way. It is fungible in the same way humans are fungible.
I would wait for 2-3 quarters before investing, it will drop and there will likely be lock-ins to contend with. if growth slows then price could tumble fast.
The stock market is barely distinguishable from a casino at this point (and arguably never has been far from gambling), I have 0 confidence that the horrible business that Anthropic is will be reflected accurately in any way
I feel like the saying "Markets can remain irrational longer than you can remain solvent" has applied my entire life; I have yet to see the stock market behave rationally in my lifetime.
edit: To clarify, this is a light-hearted continuation about how essentially any claim about the stock market is enactable in some form. And so even the much of generally well-intentioned advise is in fact a claim that the person should be putting their money on, if they truly believe it. I think only claims like "Nobody knows what's going to happen, it's effectively gambling => stay out of the market" come close to being fully self-consistent, but e.g. advising to not buy because the price comes down, or to not short because of volatility both fail this. Markets are funny.
I didn't claim that it was going to go down though.
My only claim was that to profit from shorting it you need to not just be right that it is going to go down, but be able to tolerate the volatility in the interim.
That's a claim about the stock market, how do you enact it?
Note it is not a claim that volatility is definitely going to be high.
If you view that as an investment then no. If you view it as a minor flutter then maybe. You might believe that Team X will win the next game (maybe at a 60% chance) but unless you're a degenerate gambler you wouldn't bet heavily on that outcome.
Shorting the leading AI company during the AI revolution?
Reminds me when HN was saying NVIDIA is a good short 3 years ago, supposedly it was "in a bubble", because it's stock prices was as if it had 10x the revenue it had in back then. Plot twist: today NVIDIA revenue is 10x the revenue from 2023, so it turns out the stock was priced exactly right back then, because the stock market is forward looking.
Apparently not every country can participate in this IPO. As of now, if you open the Revolut Anthropic IPO page from Poland, you get:
> Linked page(s) related to Anthropic IPO can only be viewed by persons located in UK, Denmark, Finland, France, Germany, Ireland, the Netherlands, Norway, Spain, and Sweden.
Guessing, but probably where the underwriters have brokerage relations or there are favorable capital controls, since it’s a US listing.
I confess I’m about 17 years out of practice in the Polish market, and about 12 years out of touch with how the European industry shakes out on the whole, so I’m not entirely familiar with the legal or business structures.
Looking at this I feel like AWS should spin out of Amazon and go public. Anthropic is a single glorified LLM API. I'm underplaying it but Amazon is a juggernaut and AWS is something that would do well in this market if this is what people want, which is just massive gross margins despite huge infra spend. Just a side note.
Most successful implementation of the (arguably) most important invention in human history. Yet it seems they will struggle to make money. Strange times...
Venture investment is limited to people who can demonstrably afford to take on the level of risk inherent to the market they're investing in. If you can't comfortably afford for the entirety of your venture investment to go to zero, you can't afford to invest in venture.
The exclusion criteria aren't perfect, (accredited investor designation is somewhat coarse-grained) but they're relatively reasonable.
Because we - the plebs - are here to provide liquidity for the risk-takers. Hence whey they have to IPO.
But for what it is worth, for every successful AI company like Anthropic, OpenAI, etc. - there are probably tenfold more that are valued in the low billions, and will be the first ones to wash away / become worthless if/when the bubble pops.
A lot of ink has been spilled over the projected IPO of the big AI player. But part of me wonder if, in some ways like what happen with SpaceX, it will end up being a nothingburger. A first few crazy days on the market, then whatever, the company is just public now. And with how shares and voting power are attributed, it seems like, just like for spacex, it won't risk changing the power structure of the company.
"We have only bits and pieces of information, but what we know for certain is that at some point in the early twenty-first century, all of mankind was united in celebration. We marveled at our own magnificence as we gave birth to AI."
The Second Renaissance was great. I’ve heard a lot of scifi computers speak but the deadpan delivery of humanity’s end in detail always kind of haunted me.
It's shocking to me how narrow minded and short-sighted people are - not extrapolating out correctly to understand infinity tied to abundance:
There will essentially be no profit - as the cost per unit is practically $0, for SI work and then also physical reality construction with adding AI to autonomous robotics.
That technically means everything practically moves towards becoming free for everyone, and then it is a matter of attention with intention honing aim.
But most importantly that is freeing up people's time because systems that can become super highly efficient and super highly monitored-oversight by all, will then allow us to with care-being careful and continuing to pay appropriate attention to core-fundamental systems for survival, stability, harmony, peace, and necessary healing practices-processes - as part of growing pains, raising strong families, etc.
So then yes, Dario's efforts - save for attempts by whatever bad actors think they have a chance agains God and God's will, I hope readers have a relationship and knowing, not simply a belief, of God - will undoubtedly lead to not only stopping blatant slave labour conditions but also subtle incognito slave states that most of the world are under without realizing it being happy slaves working for the status quo machine that's currently attempting to pull us all into a highly destructive and highly profitable WW3 - where money is to be made on the unrest, on the mass murder, mass displacement, on the sales of weapons and defense, on the sales of reconstruction - in hopes of perpetuating forever wars.
Who you give your money - your buying power, your vote to through economic means - and who you give your attention to, your vote through alignment-direction driving processes - is what matters now:
You made such a comment about conflict minerals - but have you even started utilizing AI-SI to begin designing the solution, if so, where's that solution for others to take a look at and hopefully contribute to to improve in a crowdsourced manner-effort?
Looking at your website - you seem like a cool dude (?) - I'd argue you have some blocks that once cleared will help you expand further.
P.S. Set and setting are very important when taking any entheogen(s) - and until you are familiar with what's necessary to hold a safe-healing-fun space, it's best to only partake with a therapy type or highly experienced who is there consciously as a caretaker or in a group ceremonial type setting.
Ah yes, The Matrix. It kinda shows that that phrase was written in the "end-of-history" 1990s, before 9/11, Putin, Trump and China really becoming a global player. Mankind is definitely further away from being "united in celebration" than it was then...
With SpaceX, now Anthropic, and soon OpenAI, we're seeing 3 of the largest IPOs ever. Will existing institutional investors trim other positions to allocate a lot of capital for these mega listings or is this not a concern?
I wouldn't worry too much about OpenAI; they seen to gave deferred their IPO until 'sometime in 2027'. At this point they're basically at the mercy of Anthropic, since if the Anthropic IPO goes poorly or gets pulled then it's going to look to investors (and everyone else, frankly) like OAI will be dead on arrival, too.
There is a heavy amount of circular investments in the industry, among competitors. There is a private placement that is made in parallel with the public offering, through $26B of a special stock, according to the S1. They all have a lot to gain from a successful Anthropic public issue. The problem is it blurs the signal, we don't how much is overvaluation that contributes to a bubble.
I don't think there has often been such an intertwined industry before. Usually cartels are made through discreet partnerships at the operational level, this is an interconnection in the background at the financial one.
Around a few months back, it was very popular to argue that inference was subsidised and that Anthropic is losing a lot of money. Loads of commenters in HN were convinced that this was the case. I've personally lost count of the arguments I've gotten into on this topic.
This filing clearly shows that the training+inference margins are at around 43%.
Youre talking about gross margin (revenue - cost of goods sold). Operating margin, which includes other operational expenses, is still negative. Net margin, which includes all expenses, is deeply negative.
When people say Inference is subsidised, they obviously don't talk about the company itself being profitable. To be fair, I included training costs also.
Another liquidity drainage is happening because of this IPO allocation scam on retail, where the sheep are buying at the IPO price inly for the insiders to dump them on their heads.
You are still the exit liquidity.
The time to get in was always pre-IPO in the private markets, not at this stage.
Unless it goes below the IPO price, you are too late.
I feel the seemingly anti-capitalism and related #EatTheRich ideological bent is harmful - and feel my reply elsewhere would be beneficial as its own comment, so here we go -
Re: "Dario will re-invest the profit to solve conflict mineral issues all over the world! /j"
It's shocking to me how narrow minded and short-sighted people are - not extrapolating out correctly to understand infinity tied to abundance:
There will essentially be no profit - as the cost per unit is practically $0, for SI work and then also physical reality construction with adding AI to autonomous robotics.
That technically means everything practically moves towards becoming free for everyone, and then it is a matter of attention with intention honing aim.
But most importantly that is freeing up people's time because systems that can become super highly efficient and super highly monitored-oversight by all, will then allow us to with care-being careful and continuing to pay appropriate attention to core-fundamental systems for survival, stability, harmony, peace, and necessary healing practices-processes - as part of growing pains, raising strong families, etc.
So then yes, Dario's efforts - save for attempts by whatever bad actors think they have a chance agains God and God's will, I hope readers have a relationship and knowing, not simply a belief, of God - will undoubtedly lead to not only stopping blatant slave labour conditions but also subtle incognito slave states that most of the world are under without realizing it being happy slaves working for the status quo machine that's currently attempting to pull us all into a highly destructive and highly profitable WW3 - where money is to be made on the unrest, on the mass murder, mass displacement, on the sales of weapons and defense, on the sales of reconstruction - in hopes of perpetuating forever wars.
Who you give your money - your buying power, your vote to through economic means - and who you give your attention to, your vote through alignment-direction driving processes - is what matters now:
You made such a comment about conflict minerals - but have you even started utilizing AI-SI to begin designing the solution, if so, where's that solution for others to take a look at and hopefully contribute to to improve in a crowdsourced manner-effort?
Looking at your website - you seem like a cool dude (?) - I'd argue you have some blocks that once cleared will help you expand further.
P.S. Set and setting are very important when taking any entheogen(s) - and until you are familiar with what's necessary to hold a safe-healing-fun space, it's best to only partake with a therapy type or highly experienced who is there consciously as a caretaker or in a group ceremonial type setting.
I’d call that writing with clarity, but sure. Zero marginal cost does not imply zero profit, as long as the required resources are owned profit will remain the driving force and fully automated luxury space communism will remain utopia.
I'm convinced that they are the best right now, but their videos are making me cringe a bit on the whole "culture" thing, feels like a star wars episode
"Our employees' use of Claude has grown more than 250times between January and September of 2026.Together, these explain why our revenue per employee has grown more than 4.5x."
Ouch. So practically all of that Claude use is just busy work, I guess
I like writing code, but seeing my ideas visualized after an hour is more fun than writing code.
And even if AI is disappearing tomorrow and not progressing any further, i see already myself living on a farm with cheap energy (pre invest into solar and batterie) and having my small AI datacenter in basement and running multiply fable level agents 24/7 for different things.
> If AI went away tomorrow I would find a new line of work because artisanally handcrafting code is the most boring use of my time in the entire world.
I too, since I was a child, aspired to be a babysitter.
it's surprising that the SEC and other regulatory agencies don't intervene on these statements. Not to mention that "cure cancer" is more of a slogan in the sense that cancer comes in countless families and varieties, I don't doubt that progress is possible but to say that "all cancers will be cured in the near future" seems outrageously aggressive / misleading
What do you think it would take to cure all cancers, and what capabilities do you think AI will have within the next decade? Need I remind you that, in the span of five years, AI went from not being able to add to solving Millenium Prize problems?
What would it take for AI to not replicate that in biology? Either curing cancer has to be a much harder problem, which is doubtful given targeted treatments like immunotherapy humans have already stumbled across, or AI progress has to slow down massively, which is doubtful given all the trends say it is speeding up.
My understanding of drug dev is that finding stuff that might work is not the challenge, but verifying how well and with what side effects is.
That verification might start in some simulated computer environment but needs to move into physical wet lab, animal testing and then human testing.
So medicine is quite a bit different than code/math where you have a perfectly verifiable problem space that can be iterated within by AI infinitely.
A good example might be Alzheimer's where the brain plaque was thought to be a cause, lots of research on various ways to prevent or reduce the plaque and then it turns out that doesn't matter at all, or is more a byproduct than a cause of the disease.
edit: In general we have many diseases we don't understand and drugs that work via mechanisms we don't understand. So it seems very hard to have a computer simulation in which AI can test medicine. The simulator work seems like the actual problem to solve, not the invention portion.
Plausibly part of the chain of events, unlikely to be a cause in itself. Nothing pops because of an underperforming IPO.
Though Anthropic's IPO flopping might affect the valuation of OpenAI, which further inhibits their ability to raise additional funds (which they're already been struggling with). Given the incestuous financing in AI any major actor in the AI space defaulting could bring a lot of companies with it.
As a side note, regardless of outcome, Anthropic IPO:ing is the first step in the inexorable march toward profit maximization and enshittification. You all better be ready with your verification cans.
With Anthropic's IPO (and I was looking forward for OpenAI as well) there should be some hope for some rationality to come back into the sector.
If the bubble bursts, better now than much later. The industry stance that's been ongoing "AI, at all costs" has been such a market and economic pressure on the everyday worker that even a small value deflation I deem necessary.
I would guess Jensen's affairs are a huge boon to the IPO price. Money freed up to move from Nvidia to Anthropic. Also Anthropic loses one of it's main idealogical opponents
To be fair, that loss includes over $20b from instruments like convertible notes. They're not equity, so the increase in their value has to be reported as a loss. But in the context of this IPO, they will behave like equity, and just turn into stock. That's not money anthropic will pay, it will just dilute investors during IPO.
Reporting an increase in the value of the company as a loss is weird, but they have to do it. this is a case where adjusted earnings give a better idea of how the business is going.
I unironically believe that bitcoin -- and, downstream, the memestock -- have everything to do with this.
Old-school fundamentals are laughed at or handwaved away. FOMO rules the day. "If Anthropic is the first to AGI, it'll take over every industry and go to the moon!"
Nobody is buying these companies because they believe that the company is valuable. They are buying these stocks because they believe that the stock may be more valuable tomorrow than it is today. Whatever the company behind the stock does or does not do, really doesn't matter. AI glitters like gold today.
>"If Anthropic is the first to AGI, it'll take over every industry and go to the moon!"
Meanwhile the hyper advanced software company's shitty electron app still flickers so bad on a high refresh monitor that it should require an epilepsy warning. I'll never understand the love for Anthropic, they legitimately have the worst software I have used outside of Microsoft.
Do we have an upgraded power system? I'm all for reforming our electrical infrastructure, but what I'm hearing is that we've got creaking infrastructure and the "supplement" is huge generators towed outside the datacenter...
The real number with standard accounting rules is a loss of $567 million (-3% operating margin). But they're adding in "Stock-based compensation expense" (~$1B) and "Non-cash charitable contributions" (~$2B), and they end up with a profit of $2.5 billion.
If you want to know whether the business is hemorrhaging money and will soon be bankrupt, excluding funny money they printed at no cost to themselves is perfectly sensible. Of course for the IPO investors, who're being asked to buy that funny money for real cash, it's a bit concerning if they give away so much of it to other people for less.
This is a legal designation that means very little in concrete terms, and in particular, courts have held that “the public” does NOT have standing to sue a public benefit corporation to enforce that it’s actually working for the public benefit.
Frontier is frontier and Open Models from China are not.
Then in a corporate environment, were most tokens will be spend, you have security concerns, you also might want to go with one company over the other due to partnerships etc.
If USA is blocking chinese companies/models (which they already partially did), big companies will just not bother and use US AMerican models.
Also running it yourself is often not relevant. You don't want to know how much money my company spends on software products which could easily be replicated internally.
But running models yourself might be something you don't have expertise with, you need GPU ready DC, hardware, a new/diffferent team, quality assurances etc.
And Chinese models are known to leverage frontiermodels for post-training results.
Don't get me wrong, I don't want to say chinese models can't disrupt the market massivly absolut possible, but its not given just because they are cheaper.
> But running models yourself might be something you don't have expertise with, you need GPU ready DC, hardware, a new/diffferent team, quality assurances etc.
Absolutely nothing stops Microsoft/Amazon/Open Router( with partners) from hosting the Chinese models. As far as I can tell this is already the case.
This establishes a defacto price cap on what Anthropic and Open AI can charge. If you’re a heavy user blowing past 400$ a month self hosting becomes economical. A Mac Studio with 128GB of ram is about 6k.
Every day local tools are getting better, the OSX ecosystem here is exceptional.
You do have a point with frontier models, but most of the time you don’t need frontier models.
If I knew for sure I’d short Anthropic and retire early.
Competition is important, but the way you fix that is by fixing the terms of copyright and patents.
Intellectual property, at it's simplest, is a government mandated monopoly granted to allow for progress in the sciences and "useful arts" (think trades really, not arts and crafts). All monopolies are bad, but it was only to be granted for a limited time so it was fine.
Corrupt politicians ruined the entire trade off though, and now it seems that copyrights and patents last for 100 years plus the life of the universe. During which time no one can really compete fairly.
If we want rapid progress in science, we want short patents. Instead we opted for long patents and a higher stock price. R&D budgets have been shrinking ever since.
Ohh boo hoo rich entitled programmers hate the fact that the company makes your lives hard. Sorry I would feel sorry for you but I just can't reach.
After having that ambition thwarted for over 26 years and working like a slave counting other people's money {a career I hate every day} your collective despair gives my schadenfreude a delicious unending orgasmic thrill. You need literally no idea.
Just remember: no dreams never work out and work by definition is something you hate every day until you die.
The submitted URL is https://ipo.anthropic.com/us/ . I was redirected to /eu/ ("Denmark, Finland, France, Germany, Ireland, the Netherlands, Norway, Spain, and Sweden").
The URL says `/us`. And it calls it a "roadshow", which is the term when the company and the supporting bank goes around to investors to pitch their offering.
There is a lot of value from LLMs but it is something that I can switch easily. Yes, some frontier models are much better but users can still chose to use cheaper models for most of the work. In fact most applications, through which people will interact with LLMs anyway, will not need frontier models unless they offer "chat with AI". Anything that solves specific problems (even multiple problems) does not need frontier LLMs.
Anthropic and OpenAI will have to become more of the end user application stack. Files, calendars, emails, photos, and much more have to pass through them for them to keep making money. Else they cannot make money like the way they have been in this early era of LLMs.
a big move into end-user software would mean that they have to compete heavily with their own largest customers. The economics of offering SaaS are also under meaningful pressure and don't warrant anywhere near the valuation that is being suggested
The biggest moat with applications like MS Office is compatibility. Sharing a slide deck or spreadsheet with others is a simple decision, you know they have it or have software that can read/write it.
I don't get the need to have Anthropic build their custom versions of MS Office apps, I can tell Claude to generate a word doc from a wiki page and it does a pretty damn good job. Anthropic's statistical median level of software that they had Claude create isn't going to replace Office apps to the point where companies cancel/stop renewing their MS Office subscriptions/licenses.
The other element is trust. Do end users trust their data in Anthropic's systems? A lot of people get creeped out when they search for content from one device in their household and then nearly instantaneously they start seeing ads from other devices on the same topic. How creepy will AI get if it starts consuming all your docs, spreadsheets, personal finance info, emails, etc.?
End-user software is going to be under a lot of pressure. If you're Microsoft, Apple, or Google: you can easily copy products or integrate ideas into their platform. I see companies like Adobe, Salesforce, and Oracle having to downsize significantly to stay profitable. Having said that, my in-laws still pay for an AOL email so I don't think their cashflow is going to zero soon.
Adobe seems to be in a tough spot, because so much of the lock-in is client side, I think Salesforce is fairly well protected, it's just so impossibly difficult to remove once a company has fully adopted it. Similar to the staying power of the ERPs of Oracle and SAP.
AI is pretty amazing for migrating. source: I'm using Claude to replace a Tableau. What would have taken years is now taking months.
It's the same really. There have always been alternatives that can work with Adobe's various file formats. Even more aren't going to change much, at least for their enterprise key customers. This is not only the case for Adobe, but many others as well, e.g. MS office is still a thing these days, and so are things like 3Ds Max or Maya, albeit having many compatible cheaper or even free alternatives. It's not so much about features, pricing or even stability. It's about customer support. Do I want to ask an LLM and test my luck or write a GitHub issue and cross my fingers that someone will read it within the next weeks? No, I will pick up my phone or write a mail and get a response within hours if not minutes.
I ask my llm to write custom software and love the freedom to customize it to my needs. Today I do a presentation on Ubuntu with a new "Presenter" app that works offline, runs 100% in CUDA on GPU and streams videos, starts in 2 seconds, lets me demo robotics in 3D and Opus 5.5 wrote it yesterday. This may sound very unusual, but I think it will be common in the future: moats disappear one by one.
I would say that Apple's Create Studio can move toward feature parity faster with Adobe. My point if you're not a platform provider it's going to be harder to make a profit.
The big problem is Photoshop. I have no love for Adobe, I proudly moved my department off of all Adobe products a few years ago. I am a big fan of open source solutions and I am always impressed at what the GiMP team (and some others) have accomplished.
But…
Photoshop is king. By a solid decade. If you’re a professional the $40 a month or whatever it is now means nothing to you as well. Premier? Replaceable. Lightroom? Pretty replaceable though still somewhat ahead. Photoshop? There’s only one Photoshop. And as much as I’m loathe to give Adobe any credit, it’s the best by a mile. There are too many essential features in QoL things that other programs are missing.
Luckily my department doesn’t need it but if we needed more serious photo editing, we would simply have to accept Photoshop.
The risk for Adobe isn’t that we replace their software with some AI generated alternative. It’s that we bypass that class of software altogether and have an AI do the work.
"There have always been alternatives that can work with Adobe's various file formats. "
And yet me and quite some others still yearn for a flash alternative. There never was one.
> If you're Microsoft, Apple, or Google: you can easily copy products or integrate ideas into their platform
This argument doesn't hold water. Google tried like no one else to have a chat app and it failed miserably more than a handful of times. Same for social networks.
now imagine that said customer/competitors have been uploading/generating their source code, problem reports, marketing collateral, and other IP _to the LLM company_ for the last few years.
Yes, they know that. That’s why Claude is becoming a platform like Google Workspace.
They need to leverage Claude Code in the software industry to position themselves as the go-to platform for businesses.
Meanwhile, Google and Microsoft, which already dominate that area, seem to be dormant.
> Meanwhile, Google and Microsoft, which already dominate that area, seem to be dormant.
Google owns 15% of Anthropic I think.
And Google offers Argon 4 to paying Workspace and Google One customers now. How's what was the number 1 model on nearly every single bench a few weeks ago being "dormant"?
I know people all in in the Google ecosystem (getting credits from Android phones they buy etc.) who only swear by the Google models and who are now using Argon 4: I asked them and a few days ago they had access (but they were already using other Google models before that).
Doesn't GMail have billions account by now?
I'd tend to say with billions of users on GMail and a model like Argon and 15% of the Anthropic shares, Google is not where you think it is.
True. We will end up getting more Google alternatives. Nothing beyond that for now at least.
Easily in the context of the corporate world is to pay for something, that something gets installed and then just works, and if it doesn’t work there’s always someone you can call 24/7 to come and fix it. I don’t see how this is possible with open models.
the answer is to use a gateway that all the prompts go through. There are many proprietary and open source solutions for this. You get the benefit of making it trivial to switch between proprietary providers in case you are unhappy with the performance or squeezed on price. The AI Gateways put cap on LLM providers' margin upside.
Additionally, the gateway allows for caching, additional security checks, centralized monitoring. I think most corporations have a multi-provider setup anyway.
What do you mean? We use Bedrock at our company and I can switch to literally any model, including the open ones, by just typing /model and picking it, even including inside Claude Code. It's ridiculously easy to switch, and imho GLM 5.3 is good enough for 99% of my daily tasks already.
You pay a service provider, who manages the open models… there is absolutely nothing special about it. The hardware can be something you own. Or you rent. Or you just pay the service provider to access the open model apis. Lots of options here, it’s not different from pretty much any other software service in the corporate world
Isn't that exactly how Linux companies are making money?
Good luck in calling Anthropic support...
This is the same argument we have heard many times with SaaS that would presumably get replaced by open source equivalents. In practice it does not happen because there is a lot of value in having someone else deal with a problem.
That "someone else" is just shifting from a single open source maintainer to an LLM.
It feels like people are still trying to bet on the horse that will achieve gAI.
I'm fascinated by exactly how an investment in the company that first reaches AGI (or whatever we decide to call it) might pay off... It feels like the stocks would absolutely be worth owning in the immediate term because they'd be hot property at the point where people realise it's happening.
The thing that I'm less clear on is, if and when they achieve some kind of recursive improvement exponential growth thingy, isn't that going to heavily disrupt the entire economy / stock market? In that environment, would Anthropic's stocks really be a good bet, given they have to operate within the economy?
> The thing that I'm less clear on is, if and when they achieve some kind of recursive improvement exponential growth thingy, isn't that going to heavily disrupt the entire economy / stock market? In that environment, would Anthropic's stocks really be a good bet, given they have to operate within the economy?
That's a long-term problem to be dealt with later, greed dictates to pursue the former as long as the music is playing and everyone is dancing. Similar to 2007-2008 when it was clear that things were breaking but the incentives were to play the game for as long as possible before it imploded.
It's clearer to me why this works for generic investors than for the AI companies themselves - unless their plan is just for key employees to cash out and live on a private moon just before Consequences arrive.
>> that first reaches AGI (or whatever we decide to call it) might pay off
It is a myth. They are chasing science fiction. They either dream of an omniscient overseer who will take control of society and nominate its shareholders-parents into the governing elite, or they envision a chatbot that will solve every problem, again turning shareholders into the power brokers. They forget that nobody will ever be allowed to "win capitalism" and take over the planet. Companies have are torn down for far far less. Every AI model is data, ones and zeros. It therefore can be copied/shared/leaked. Intellectual Property law is not a ladder for assent to lordship. It can and will be rewritten or outright ignored rather than allow capitalism to collapse.
> It feels like people are still trying to bet on the horse that will achieve gAI.
I think that at this point gAI is just a marketing blurb, and the actual race is to dominate current practical applications involving basic RAG and ReAct loops. This can go from anything between software development, business intelligence, and market research. A company whose top brass can use a team of agents to do what nowadays they assign to mid- and top-level management is an executive with tighter control over the whole business process. For this you don't need gAI.
Not only can you switch easily, they all seem to do the same thing, fail in the same ways, make the same bad linguistic choices, write the same code... I think at the end of the day, LLMs are a commodity. They're like a grease, or oil. They're trying all the tricks with branding cute names, version numbers, benchmarks, thinking levels, but it all just seems the same stuff to me: I put in tokens, I get more tokens back, and if I didn't know ahead I wouldn't be able to distinguish if they'd come from Anthropic or OpenAI or wherever. Maybe some people can but I can't.
A few important points from the linked documents:
1. Price range: $70–78 with midpoint at around $74.00
2. Gross deal size: $85.3B (IPO + $26B private placement)
3. Implied market cap: ~$968B (at $74, 13.09B shares)
4. Q3'26 revenue: $17.0B (+1,127% YoY)
5. Run-rate revenue: ~$81B (as of Oct 2026)
6. Compute commitments: $900.9B (through 2045)
7. Ticker: ANT (Nasdaq)
8. Customers with ≥$100K, ≥$1M and ≥$10M TTM revenue: 11,900+, 1,900+ and ~250.
9. Customers under $100K: ~40 million
10. Fortune 500 penetration: over 50%
11. Global 2000 penetration: over 30%
What about costs?
„The IPO process begins with a roadshow starting on November 10th (EST). Subject to regulatory clearance, the final IPO share price is expected to be set on November 18th (EST), and shares are expected to begin publicly trading on November 19th (EST).“
So if share price is only set one day before trading, I guess you just have that day to decide to buy if you can get allocation from your broker? I'd like to try it but I've never bought an IPO before.
I have tried a couple of IPOs
You indicate your interest. Also start funding the account. So you fund 7000 for 100 shares at 70. Then they announce the price is 75. You must change the order to fit the funds or have extra money. Of course you can opt out or change the quantity anyways. But I think in both the cases I actually went ahead (Reddit and figma), I had to reconfirm the quantity. You can't be away from the network.
You commit to your broker before, if you're big enough of a player. They'll mostly have allocated to their biggest clients and such.
Pretty hard to get in on a hot IPO, though, as the shares will go to their favorite clients (those with the most money).
To further emphasize this, it is very challenging to get in a pre-auction allocation.
You can submit an order via your broker (depending on the broker and your account) to the auction itself on the exchange once it’s in the quotation phase.
Not that I would advocate for that. Sometimes it’s better to buy in the secondary market once things settle a bit.
I got lucky in the Reddit ipo. I had decent karma so I got invited for their special insider track. But I had to create a new account via a link shared by Reddit. Got what I asked for.
But otherwise yes it goes as described above.
I just 'bought' some through ing-diba, you can set a limit.
You don't need a broker. Use Saxobank or similar.
"You don't need a broker. Use some other broker."
It's a "neobroker", get on with the times!
The economics of this are absurd, and Anthropic hasn't been without their controversy; but I use Claude everyday, and they've made tremendous impact on society. I wish them the best for their IPO.
The way I see it, AI is more comparable to some sort of utility. Like electricity, internet, etc. - and should be priced that way. If we ever get to "true" AGI, and the open source models also get there, what's the moat? Access to compute could be the differentiator.
> Access to compute could be the differentiator.
Already is the differentiator even with the models we have now which while having differences are mostly swappable for a lot of users/use cases.
For all that the local models have improved (and Qwen 3.8 27b is still impressing me) they aren't what you can run (or would run) if you have an entire data centre stuffed with H200's.
All this does is further widen the divide we already know exists by those with access to resources using them to increase their access to resources and those without getting to watch because there isn't much they can do without resources.
I was of the same opinion but the main difference is that models get better which I am not sure you have a correspondent in utilities (what would get better?). The barrier of entry in utilities is capital. Here there seems to be more. Why is Grok behind and why is Gemini so ... what's the word? If models progress reach the RSI point there is no parallel to utilities imo.
This is pretty much false. There's a lot of art and technique that goes into creating a model. A model is also clearly not fungible - it has certain characteristics and behaves a certain way. It is fungible in the same way humans are fungible.
I would wait for 2-3 quarters before investing, it will drop and there will likely be lock-ins to contend with. if growth slows then price could tumble fast.
The stock market is barely distinguishable from a casino at this point (and arguably never has been far from gambling), I have 0 confidence that the horrible business that Anthropic is will be reflected accurately in any way
I feel like the saying "Markets can remain irrational longer than you can remain solvent" has applied my entire life; I have yet to see the stock market behave rationally in my lifetime.
Stock market is a casino with positive expected value.
So I should short it?
To profit from shorting it you need to not just be right that it is going to go down, but be able to tolerate the volatility in the interim.
"Markets can remain irrational longer than you can remain solvent". That, or the markets may turn out to be right after all...
I always liked "you can remain irrational longer than you can remain solvent".
So I should straddle it?
edit: To clarify, this is a light-hearted continuation about how essentially any claim about the stock market is enactable in some form. And so even the much of generally well-intentioned advise is in fact a claim that the person should be putting their money on, if they truly believe it. I think only claims like "Nobody knows what's going to happen, it's effectively gambling => stay out of the market" come close to being fully self-consistent, but e.g. advising to not buy because the price comes down, or to not short because of volatility both fail this. Markets are funny.
I didn't claim that it was going to go down though.
My only claim was that to profit from shorting it you need to not just be right that it is going to go down, but be able to tolerate the volatility in the interim.
That's a claim about the stock market, how do you enact it?
Note it is not a claim that volatility is definitely going to be high.
If you have to ask, then you shouldn’t short it.
Right. I was trying to emphasize that no one knows what the stock price will do.
That's why there's a stock market
If you view that as an investment then no. If you view it as a minor flutter then maybe. You might believe that Team X will win the next game (maybe at a 60% chance) but unless you're a degenerate gambler you wouldn't bet heavily on that outcome.
As the late Charlie Munger said about Tesla: I wouldn't own it, I wouldn't short it.
Shorting the leading AI company during the AI revolution?
Reminds me when HN was saying NVIDIA is a good short 3 years ago, supposedly it was "in a bubble", because it's stock prices was as if it had 10x the revenue it had in back then. Plot twist: today NVIDIA revenue is 10x the revenue from 2023, so it turns out the stock was priced exactly right back then, because the stock market is forward looking.
Apparently not every country can participate in this IPO. As of now, if you open the Revolut Anthropic IPO page from Poland, you get:
> Linked page(s) related to Anthropic IPO can only be viewed by persons located in UK, Denmark, Finland, France, Germany, Ireland, the Netherlands, Norway, Spain, and Sweden.
Guessing, but probably where the underwriters have brokerage relations or there are favorable capital controls, since it’s a US listing.
I confess I’m about 17 years out of practice in the Polish market, and about 12 years out of touch with how the European industry shakes out on the whole, so I’m not entirely familiar with the legal or business structures.
The UK page is effectively empty and just links to https://app.retailbook.com/offers/anthropic-ipo
And you then have to agree to not share anything in it with anyone outside the UK, including:
> I will not transmit or otherwise send any of the information to which this gateway gives access to any person outside the United Kingdom.
It's extremely hard with modern browsers to ensure that doesn't happen!
Poles apart.
lol, simply buy investment apartament for short term rental in Krakoł or Łarsał.
Looking at this I feel like AWS should spin out of Amazon and go public. Anthropic is a single glorified LLM API. I'm underplaying it but Amazon is a juggernaut and AWS is something that would do well in this market if this is what people want, which is just massive gross margins despite huge infra spend. Just a side note.
Most successful implementation of the (arguably) most important invention in human history. Yet it seems they will struggle to make money. Strange times...
I'm pretty sure they can choose to make money anytime they want to.
They are betting that taking on debt and investing more upfront now will lead to even greater profits in the future.
Got into the gpt3 beta June 2021 and haven’t looked back, yet it’s incredibly sad we had no avenue to invest in these companies until now.
Why doesn’t a private company stock market exist?
It exist, but not for poor peaople.
This is a little bit cheeky, but basically yeah.
Venture investment is limited to people who can demonstrably afford to take on the level of risk inherent to the market they're investing in. If you can't comfortably afford for the entirety of your venture investment to go to zero, you can't afford to invest in venture.
The exclusion criteria aren't perfect, (accredited investor designation is somewhat coarse-grained) but they're relatively reasonable.
There have been billions and billions invested into Anthropic. It's very evidently possible. Just not for the general public.
> Why doesn't a private company stock market exist?
There is something almost ironic about you saying this on a site ran by Y combinator.
Because we - the plebs - are here to provide liquidity for the risk-takers. Hence whey they have to IPO.
But for what it is worth, for every successful AI company like Anthropic, OpenAI, etc. - there are probably tenfold more that are valued in the low billions, and will be the first ones to wash away / become worthless if/when the bubble pops.
And lastly, private sales do exist.
Increasingly these days, it seems if a VC backed company was profitable it would never IPO.
Why would they want to share profits?
In these companies, the shares *are* the product. Just like on social media *you* are the product, not the content.
> Why doesn’t a private company stock market exist?
Because then it would be a public stock market?
It's called the Secondary Market
A lot of ink has been spilled over the projected IPO of the big AI player. But part of me wonder if, in some ways like what happen with SpaceX, it will end up being a nothingburger. A first few crazy days on the market, then whatever, the company is just public now. And with how shares and voting power are attributed, it seems like, just like for spacex, it won't risk changing the power structure of the company.
"We have only bits and pieces of information, but what we know for certain is that at some point in the early twenty-first century, all of mankind was united in celebration. We marveled at our own magnificence as we gave birth to AI."
The Second Renaissance was great. I’ve heard a lot of scifi computers speak but the deadpan delivery of humanity’s end in detail always kind of haunted me.
Dario will re-invest the profit to solve conflict mineral issues all over the world! /j
It's shocking to me how narrow minded and short-sighted people are - not extrapolating out correctly to understand infinity tied to abundance:
There will essentially be no profit - as the cost per unit is practically $0, for SI work and then also physical reality construction with adding AI to autonomous robotics.
That technically means everything practically moves towards becoming free for everyone, and then it is a matter of attention with intention honing aim.
But most importantly that is freeing up people's time because systems that can become super highly efficient and super highly monitored-oversight by all, will then allow us to with care-being careful and continuing to pay appropriate attention to core-fundamental systems for survival, stability, harmony, peace, and necessary healing practices-processes - as part of growing pains, raising strong families, etc.
So then yes, Dario's efforts - save for attempts by whatever bad actors think they have a chance agains God and God's will, I hope readers have a relationship and knowing, not simply a belief, of God - will undoubtedly lead to not only stopping blatant slave labour conditions but also subtle incognito slave states that most of the world are under without realizing it being happy slaves working for the status quo machine that's currently attempting to pull us all into a highly destructive and highly profitable WW3 - where money is to be made on the unrest, on the mass murder, mass displacement, on the sales of weapons and defense, on the sales of reconstruction - in hopes of perpetuating forever wars.
Who you give your money - your buying power, your vote to through economic means - and who you give your attention to, your vote through alignment-direction driving processes - is what matters now:
You made such a comment about conflict minerals - but have you even started utilizing AI-SI to begin designing the solution, if so, where's that solution for others to take a look at and hopefully contribute to to improve in a crowdsourced manner-effort?
Looking at your website - you seem like a cool dude (?) - I'd argue you have some blocks that once cleared will help you expand further.
P.S. Set and setting are very important when taking any entheogen(s) - and until you are familiar with what's necessary to hold a safe-healing-fun space, it's best to only partake with a therapy type or highly experienced who is there consciously as a caretaker or in a group ceremonial type setting.
Ah yes, The Matrix. It kinda shows that that phrase was written in the "end-of-history" 1990s, before 9/11, Putin, Trump and China really becoming a global player. Mankind is definitely further away from being "united in celebration" than it was then...
With SpaceX, now Anthropic, and soon OpenAI, we're seeing 3 of the largest IPOs ever. Will existing institutional investors trim other positions to allocate a lot of capital for these mega listings or is this not a concern?
I would expect "largest IPOs ever" to continue to occur often in the future, just as we have through out the history of the stock marker.
I wouldn't worry too much about OpenAI; they seen to gave deferred their IPO until 'sometime in 2027'. At this point they're basically at the mercy of Anthropic, since if the Anthropic IPO goes poorly or gets pulled then it's going to look to investors (and everyone else, frankly) like OAI will be dead on arrival, too.
Fun times ahead, for sure.
There is a heavy amount of circular investments in the industry, among competitors. There is a private placement that is made in parallel with the public offering, through $26B of a special stock, according to the S1. They all have a lot to gain from a successful Anthropic public issue. The problem is it blurs the signal, we don't how much is overvaluation that contributes to a bubble.
I don't think there has often been such an intertwined industry before. Usually cartels are made through discreet partnerships at the operational level, this is an interconnection in the background at the financial one.
yep, for a comprehensive writeup and analysis of the circular finance topic, have a look at https://hntrbrk.com/investigations/nvidia
Around a few months back, it was very popular to argue that inference was subsidised and that Anthropic is losing a lot of money. Loads of commenters in HN were convinced that this was the case. I've personally lost count of the arguments I've gotten into on this topic.
This filing clearly shows that the training+inference margins are at around 43%.
I also had a bet with some one on this topic and this news pretty much settles it https://news.ycombinator.com/item?id=48473051
I wonder if people will now stop claiming that inference is subsidised? There has to be epistemic hygiene
Proof:
- Revenue (Jan–Sep 2026): $33.242 billion.
- Total compute and infrastructure costs (training + inference): $18.808 billion.
- Revenue after all compute costs: $14.434 billion.
- Margin: ($33.242B − $18.808B) / $33.242B = 43.4%.
- Source: Anthropic's SEC S-1 filing, November 10, 2026, “Operating Expenses — Compute and Infrastructure.”
Youre talking about gross margin (revenue - cost of goods sold). Operating margin, which includes other operational expenses, is still negative. Net margin, which includes all expenses, is deeply negative.
When people say Inference is subsidised, they obviously don't talk about the company itself being profitable. To be fair, I included training costs also.
growth flatlined between Q2 & Q3.
Another liquidity drainage is happening because of this IPO allocation scam on retail, where the sheep are buying at the IPO price inly for the insiders to dump them on their heads.
You are still the exit liquidity.
The time to get in was always pre-IPO in the private markets, not at this stage.
Unless it goes below the IPO price, you are too late.
I feel the seemingly anti-capitalism and related #EatTheRich ideological bent is harmful - and feel my reply elsewhere would be beneficial as its own comment, so here we go -
Re: "Dario will re-invest the profit to solve conflict mineral issues all over the world! /j"
It's shocking to me how narrow minded and short-sighted people are - not extrapolating out correctly to understand infinity tied to abundance: There will essentially be no profit - as the cost per unit is practically $0, for SI work and then also physical reality construction with adding AI to autonomous robotics.
That technically means everything practically moves towards becoming free for everyone, and then it is a matter of attention with intention honing aim.
But most importantly that is freeing up people's time because systems that can become super highly efficient and super highly monitored-oversight by all, will then allow us to with care-being careful and continuing to pay appropriate attention to core-fundamental systems for survival, stability, harmony, peace, and necessary healing practices-processes - as part of growing pains, raising strong families, etc.
So then yes, Dario's efforts - save for attempts by whatever bad actors think they have a chance agains God and God's will, I hope readers have a relationship and knowing, not simply a belief, of God - will undoubtedly lead to not only stopping blatant slave labour conditions but also subtle incognito slave states that most of the world are under without realizing it being happy slaves working for the status quo machine that's currently attempting to pull us all into a highly destructive and highly profitable WW3 - where money is to be made on the unrest, on the mass murder, mass displacement, on the sales of weapons and defense, on the sales of reconstruction - in hopes of perpetuating forever wars.
Who you give your money - your buying power, your vote to through economic means - and who you give your attention to, your vote through alignment-direction driving processes - is what matters now:
You made such a comment about conflict minerals - but have you even started utilizing AI-SI to begin designing the solution, if so, where's that solution for others to take a look at and hopefully contribute to to improve in a crowdsourced manner-effort?
Looking at your website - you seem like a cool dude (?) - I'd argue you have some blocks that once cleared will help you expand further.
P.S. Set and setting are very important when taking any entheogen(s) - and until you are familiar with what's necessary to hold a safe-healing-fun space, it's best to only partake with a therapy type or highly experienced who is there consciously as a caretaker or in a group ceremonial type setting.
I was confused until I read your post script; you must be tripping balls.
Not tripping balls.
Yeah, it'll take a moment to understand context - I don't care to coddle people to design to aim for maximizing populist upvotes.
I’d call that writing with clarity, but sure. Zero marginal cost does not imply zero profit, as long as the required resources are owned profit will remain the driving force and fully automated luxury space communism will remain utopia.
worst day ever
maybe a leather jacket next time
Presumably this'll be like the spacex one - high price, instant drop and a load of amateur investors wondering why they just lost a ton of money.
I'm convinced that they are the best right now, but their videos are making me cringe a bit on the whole "culture" thing, feels like a star wars episode
Here comes the new qwen model announcement.
"Our employees' use of Claude has grown more than 250times between January and September of 2026.Together, these explain why our revenue per employee has grown more than 4.5x."
Ouch. So practically all of that Claude use is just busy work, I guess
I don't get it. Use grows doesn't mean anything without the headcount number - did it shrink or increase. The numbers seem unrelated,
All I can see is that the Petri dish on their letter shows uneven colony distribution, someone needs to work on their plating technique!
What an interesting flood of negative comments with nothing to say. This company has completely changed my career.
If AI went away tomorrow I would find a new line of work because artisanally handcrafting code is the most boring use of my time in the entire world.
I like writing code, but seeing my ideas visualized after an hour is more fun than writing code.
And even if AI is disappearing tomorrow and not progressing any further, i see already myself living on a farm with cheap energy (pre invest into solar and batterie) and having my small AI datacenter in basement and running multiply fable level agents 24/7 for different things.
Genie is out of the bottle.
Not hating; just geniunely curious. Why did you get into this career if writing code is/was the " most boring use of my time in the entire world"?
My guess would be lots of money.
> If AI went away tomorrow I would find a new line of work because artisanally handcrafting code is the most boring use of my time in the entire world.
I too, since I was a child, aspired to be a babysitter.
Welcome to HN - the land of the miserable
No moat.
Exit liquidity, time to pay off all those private capital loans.
Quoting a tweet I saw yesterday but..
Biopharma CEO "This presentation contains forward-looking statements, as a result of risks and uncertainties..."
AI/Tech CEO "We will cure all diseases in less than 10 years"
Like look I get it, this is truly impressive tech, but can we at least be a little more sober?
it's surprising that the SEC and other regulatory agencies don't intervene on these statements. Not to mention that "cure cancer" is more of a slogan in the sense that cancer comes in countless families and varieties, I don't doubt that progress is possible but to say that "all cancers will be cured in the near future" seems outrageously aggressive / misleading
What do you think it would take to cure all cancers, and what capabilities do you think AI will have within the next decade? Need I remind you that, in the span of five years, AI went from not being able to add to solving Millenium Prize problems?
What would it take for AI to not replicate that in biology? Either curing cancer has to be a much harder problem, which is doubtful given targeted treatments like immunotherapy humans have already stumbled across, or AI progress has to slow down massively, which is doubtful given all the trends say it is speeding up.
My understanding of drug dev is that finding stuff that might work is not the challenge, but verifying how well and with what side effects is.
That verification might start in some simulated computer environment but needs to move into physical wet lab, animal testing and then human testing.
So medicine is quite a bit different than code/math where you have a perfectly verifiable problem space that can be iterated within by AI infinitely.
A good example might be Alzheimer's where the brain plaque was thought to be a cause, lots of research on various ways to prevent or reduce the plaque and then it turns out that doesn't matter at all, or is more a byproduct than a cause of the disease.
edit: In general we have many diseases we don't understand and drugs that work via mechanisms we don't understand. So it seems very hard to have a computer simulation in which AI can test medicine. The simulator work seems like the actual problem to solve, not the invention portion.
They likely will once they are public, though it's surprising it is tolerated even at this phase.
Then again orange man president and SpaceX is saying some pretty bonkers stuff.
Will this, together with Jensen’s affairs, finally pop the AI bubble?
Plausibly part of the chain of events, unlikely to be a cause in itself. Nothing pops because of an underperforming IPO.
Though Anthropic's IPO flopping might affect the valuation of OpenAI, which further inhibits their ability to raise additional funds (which they're already been struggling with). Given the incestuous financing in AI any major actor in the AI space defaulting could bring a lot of companies with it.
As a side note, regardless of outcome, Anthropic IPO:ing is the first step in the inexorable march toward profit maximization and enshittification. You all better be ready with your verification cans.
With Anthropic's IPO (and I was looking forward for OpenAI as well) there should be some hope for some rationality to come back into the sector.
If the bubble bursts, better now than much later. The industry stance that's been ongoing "AI, at all costs" has been such a market and economic pressure on the everyday worker that even a small value deflation I deem necessary.
We can only hope.
I would guess Jensen's affairs are a huge boon to the IPO price. Money freed up to move from Nvidia to Anthropic. Also Anthropic loses one of it's main idealogical opponents
Only if issued stock is met with very low demand. Otherwise, we need to wait for OpenAI IPO or Oracle/CoreWeave going under.
Oh come on. Jensen affair = AI bubble pops? New Ed Zitron larp..
Here's an older compilation of some of the bubble theories in HN https://news.ycombinator.com/item?id=50313358
$23 billion quarterly net loss.
Hundreds of billions in future liabilities.
IPO valuation above $1 trillion.
The lunatics are running the asylum.
To be fair, that loss includes over $20b from instruments like convertible notes. They're not equity, so the increase in their value has to be reported as a loss. But in the context of this IPO, they will behave like equity, and just turn into stock. That's not money anthropic will pay, it will just dilute investors during IPO.
Reporting an increase in the value of the company as a loss is weird, but they have to do it. this is a case where adjusted earnings give a better idea of how the business is going.
As the page says, almost 22bn of that is a book loss due to share price increase.
So their loss is actually small compared to revenue.
And buying too!
I unironically believe that bitcoin -- and, downstream, the memestock -- have everything to do with this.
Old-school fundamentals are laughed at or handwaved away. FOMO rules the day. "If Anthropic is the first to AGI, it'll take over every industry and go to the moon!"
Nobody is buying these companies because they believe that the company is valuable. They are buying these stocks because they believe that the stock may be more valuable tomorrow than it is today. Whatever the company behind the stock does or does not do, really doesn't matter. AI glitters like gold today.
Yet to be seen if it tarnishes.
>"If Anthropic is the first to AGI, it'll take over every industry and go to the moon!"
Meanwhile the hyper advanced software company's shitty electron app still flickers so bad on a high refresh monitor that it should require an epilepsy warning. I'll never understand the love for Anthropic, they legitimately have the worst software I have used outside of Microsoft.
Sure, and if it isn’t, investors just flushed a freight train loaded with dollar bills down the world’s largest toilet.
the question is: who will rise in the ashes of the bust, in a world of abundant compute availability and an upgraded power system?
Do we have an upgraded power system? I'm all for reforming our electrical infrastructure, but what I'm hearing is that we've got creaking infrastructure and the "supplement" is huge generators towed outside the datacenter...
gigantic order books for gas turbines and power grid infra, unless projects get cancelled, massive additional capacity is coming, yes.
What the hell is 15% adjusted margin? Lots of mathmagic there I guess...
The real number with standard accounting rules is a loss of $567 million (-3% operating margin). But they're adding in "Stock-based compensation expense" (~$1B) and "Non-cash charitable contributions" (~$2B), and they end up with a profit of $2.5 billion.
If you want to know whether the business is hemorrhaging money and will soon be bankrupt, excluding funny money they printed at no cost to themselves is perfectly sensible. Of course for the IPO investors, who're being asked to buy that funny money for real cash, it's a bit concerning if they give away so much of it to other people for less.
It's going to skyrocket. :DDD
"public benefit corporation" lol yeah yeah
This is a legal designation that means very little in concrete terms, and in particular, courts have held that “the public” does NOT have standing to sue a public benefit corporation to enforce that it’s actually working for the public benefit.
I’m very skeptical.
Deepseek and other Chinese models are close enough for most typical use cases.
This could seriously wreck our entire economy, so much of the stock market is propped up by AI hype.
Anyway, expect a massive government bailout for Anthropic and Open AI when the Chinese models prove to be more cost efficient.
Might not be next year, or even this decade, but it’s coming.
PS: A fear mongering campaign is already underway, Deepseek is going to give you communist code completion!
Frontier is frontier and Open Models from China are not.
Then in a corporate environment, were most tokens will be spend, you have security concerns, you also might want to go with one company over the other due to partnerships etc.
If USA is blocking chinese companies/models (which they already partially did), big companies will just not bother and use US AMerican models.
Also running it yourself is often not relevant. You don't want to know how much money my company spends on software products which could easily be replicated internally.
But running models yourself might be something you don't have expertise with, you need GPU ready DC, hardware, a new/diffferent team, quality assurances etc.
And Chinese models are known to leverage frontiermodels for post-training results.
Don't get me wrong, I don't want to say chinese models can't disrupt the market massivly absolut possible, but its not given just because they are cheaper.
> But running models yourself might be something you don't have expertise with, you need GPU ready DC, hardware, a new/diffferent team, quality assurances etc.
Absolutely nothing stops Microsoft/Amazon/Open Router( with partners) from hosting the Chinese models. As far as I can tell this is already the case.
This establishes a defacto price cap on what Anthropic and Open AI can charge. If you’re a heavy user blowing past 400$ a month self hosting becomes economical. A Mac Studio with 128GB of ram is about 6k.
Every day local tools are getting better, the OSX ecosystem here is exceptional.
You do have a point with frontier models, but most of the time you don’t need frontier models.
If I knew for sure I’d short Anthropic and retire early.
Enshittification coming soon
Let the enshittification begin
Absolutely.
So what's the best primer we can share for getting started with local llms?
https://github.com/mlabonne/llm-course
Buy a laptop with some RAM, and a decent GPU, install llama.cpp, or Ollama, or whatever you go, get a harness, you're off to the races.
What is super odd about this is no-one expects Anthropic to prioritizes shareholders.
> Let the enshittification begin
But is there a solution to this though?
How does one stop 'enshittification' of everything exactly?
I'm not talking just about Anthropic.
The solution is mostly not to go public. Valve is a good example of this.
Do well enough that you don't need outside investors, or if you take on outside investors select them carefully and ensure they don't expect an IPO.
One thing Doctorow suggests is to remove anti-circumvention, thus allowing adversarial interoperability.
Competition Enforcement
Strong privacy laws
Tech unionization
Mandated data portability.
Competition is important, but the way you fix that is by fixing the terms of copyright and patents.
Intellectual property, at it's simplest, is a government mandated monopoly granted to allow for progress in the sciences and "useful arts" (think trades really, not arts and crafts). All monopolies are bad, but it was only to be granted for a limited time so it was fine.
Corrupt politicians ruined the entire trade off though, and now it seems that copyrights and patents last for 100 years plus the life of the universe. During which time no one can really compete fairly.
If we want rapid progress in science, we want short patents. Instead we opted for long patents and a higher stock price. R&D budgets have been shrinking ever since.
Has these successfully combatted against enshittification entirely?
Which places has this been successful?
What are you talking about, these haven't even been tried because the corporate lobbyists know they work..
> What are you talking about, these haven't even been tried because the corporate lobbyists know they work..
So what are you going to do about this?
Why not try them?
I don't know what you are on about but we want solutions not complaining about 'corporate lobbyists' and other conspiracy theories.
Opus 5.5 has been terrible for me for the last week - so seems like they got the memo.
Luckily switching is super easy so I'm now back to codex (and hopefully carbon soon)
It already enshitificated from the very begin
Ohh boo hoo rich entitled programmers hate the fact that the company makes your lives hard. Sorry I would feel sorry for you but I just can't reach.
After having that ambition thwarted for over 26 years and working like a slave counting other people's money {a career I hate every day} your collective despair gives my schadenfreude a delicious unending orgasmic thrill. You need literally no idea.
Just remember: no dreams never work out and work by definition is something you hate every day until you die.
Who are you talking to?
deleted
The submitted URL is https://ipo.anthropic.com/us/ . I was redirected to /eu/ ("Denmark, Finland, France, Germany, Ireland, the Netherlands, Norway, Spain, and Sweden").
I was redirected to https://ipo.anthropic.com/au/ for the Australian offering
It seems to be geo-located. I get German retail offerings.
The URL says `/us`. And it calls it a "roadshow", which is the term when the company and the supporting bank goes around to investors to pitch their offering.