(Nov 7): Anthropic PBC’s initial public offering (IPO) plans ran into a punishing post-election selloff, prompting a rethink among prospective investors of the company’s expected valuation.

Ahead of the artificial intelligence (AI) lab kicking off formal IPO marketing next week, potential buyers are discussing about a US$1.2 trillion (RM4.85 trillion) to US$1.3 trillion valuation range for the company, according to people familiar with the matter. Some are weighing a value as low as US$1.1 trillion, one of the people said.

Investors considering bids previously told bankers on the IPO that their estimate of a fair valuation had moved to around US$1.4 trillion to US$1.5 trillion, Bloomberg News has reported. That has shifted again after the Nasdaq 100 index plunged 6.4% on Thursday, wiping out US$2.3 trillion in market value, a record for a single day.

Deliberations are ongoing and no final decisions have been made, said the people, who asked not to be identified as the information isn’t public. A spokesperson for Anthropic declined to comment.

A volatile environment for tech stocks has already dented the outlook for what would be the first IPO by a so-called frontier AI model maker. Investors estimated a fair valuation for Anthropic as high as US$2 trillion in early October, people familiar with the matter have said. The retreat to around US$1.4 trillion to US$1.5 trillion came after a company briefing on its latest financials in October, Bloomberg News reported at the time.

Questions about the Claude chatbot maker’s valuation in the IPO accelerated after the Democratic sweep of Congress triggered the prospect of greater scrutiny over the pace and impact of data centre expansion. The Cboe Volatility Index rose to the highest since April 2025 on Thursday, making any IPO more difficult for investors to stomach.

One potential limiting factor for Anthropic is the battle to stay ahead of rival OpenAI’s valuation. Anthropic leapfrogged OpenAI in May, raising money privately at a US$965 billion value. OpenAI is targeting a US$1.25 trillion pre-money valuation in its latest funding round, Bloomberg News reported.

Max Kettner, chief multi-asset strategist at HSBC Holdings plc, said around US$1 trillion could be a more comfortable level for the valuation, reducing the risk of elevated volatility once trading begins.

“I don’t think we need the headline ‘oh my god, it is a trillion dollar IPO,’ because I think what’s actually more important is the secondary,” Kettner told Bloomberg Radio. “If we get a dynamic like we had with SpaceX, that you get it on secondary and then stock rips for a couple hours, but then it dumps, in the current environment you don’t want to have that.”

Anthropic and its selling shareholders may start the formal marketing with a conservative size and valuation target and increase it based on a positive initial response from investors. Chipmaker Cerebras Systems Inc and design software firm Figma Inc raised more than they indicated in their initial marketing as bankers gauged rising demand. However, both are now trading well below their IPO prices.

Another, less palatable option is for Anthropic to delay its plans. Companies have to have their IPO filings available to the public for at least 15 calendar days before they can begin formal marketing, typically followed by pricing and trading a week later, but some choose to wait weeks or even months after filing publicly to kick off marketing, updating additional quarterly financial data to keep their disclosures fresh.

Michael Field, chief equity strategist at Morningstar, thinks Anthropic would accept a lower valuation if that’s what the market gives them.

“The cost both physically and reputationally of delaying the IPO that might hurt the valuation more in the longer term, whereas if markets hold up at the level that they are, they’ll just get it done at a slightly lower valuation, suck it up and move on,” Field said.

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