Analysis:Anthropic IPO stands alone as AI market jitters sideline others

Oct 22 : A once-robust fall calendar for technology IPOs is down to just Anthropic.

The AI lab is pressing ahead to hold its initial public offering as planned in the middle of next month after making its  prospectus public as early as late October, people familiar with the matter said, cautioning the plan and the dates are subject to change. 

Anthropic's planned IPO will test whether its position at the center of the booming AI business, which the company is believed to deem worthy of a potential $1.5 trillion valuation, can overcome a market environment that might typically prompt bankers and deal lawyers to counsel delay. Anthropic is expected to begin marketing its shares to prospective investors during the week of November 9, one of the people said.

Other companies in the artificial intelligence infrastructure and data center sectors have delayed their listings, facing a rise in interest rates that has helped fuel a punishing selloff in shares and bonds of AI operators such as CoreWeave and broader questions about the sustainability of AI spending. 

The contrast underscores Anthropic's appeal to investors even as concerns about competition from open-source models and AI safety weigh on the sector. 

Many  large investors remain bullish on Anthropic’s prospects despite the fall turbulence, viewing the firm as one of the few opportunities to gain exposure to a technology sector that long-term investors cannot afford to ignore. Other issuers are reluctant to compete with Anthropic for institutional investors' attention and capital, two of the people said.

Anthropic didn't immediately respond to a request for comment.

VALUATIONS COMING UNDER PRESSURE

The AI sector pullback follows a string of IPO delays and withdrawals since September, as market volatility and rising interest rates have made it harder for companies to secure attractive valuations.

Switch, a data center operator, and Nscale, an AI infrastructure provider, have pushed their IPO plans back to later this year, people familiar with the matter said, while stressing that plans remain fluid and subject to change. Nscale’s delay was partly driven by the need to address comments from SEC staff, one other person said. SoftBank-backed SB Energy has also postponed its listing, Reuters previously reported.

Switch, NScale and SB Energy didn't immediately respond to requests for comment.

South Korean AI chip startup Elice was among the latest to shelve its listing plans overnight. Blackstone-backed AirTrunk REIT and Nvidia-backed Firmus have also pulled or paused their offerings, Reuters has reported.

Oura's recent IPO has added to the caution among prospective issuers. The offering attracted little participation from long-only investors, a person familiar with the matter said, raising concerns about the depth of demand from institutional investors that typically provide a stable base of shareholders for newly listed companies.

SCRUTINY ON MULTIPLE FRONTS

The retreat from AI infrastructure listings reflects growing scrutiny of the enormous capital required to build data centers and whether future demand will justify the investment.

Recent developments involving CoreWeave have added to concerns about a potential slowdown in AI spending, although some market participants do not expect such a downturn to materialize.

Nscale publicly filed its IPO registration statement in September, while Switch submitted its filing confidentially, Reuters reported previously. A confidential filing allows a company to work with regulators on its registration statement before disclosing financial and business details to the public. Companies typically publish the filing ahead of investor roadshows, when they begin marketing shares to prospective investors.