Thread

Anthropic's IPO prospectus shows AI vision, surging costs

143 points · 150 comments · 6thbit

camdenreslink · 1790640943 · focus · HN ↗
Some of these numbers are crazy. The scale of them is hard to comprehend.
- $42 billion net loss in 2025
- $518 billion in infrastructure obligations coming up (EDIT)
- 1/4 of revenue coming from 2 customers
1. meowface · 1790640991 · focus · HN ↗
  Sure, but their revenue growth numbers are also crazy.
  1. socializer · 1790641626 · focus · HN ↗
    Here's another amazing trick for revenue growth: buy items on Amazon and then sell them on your website for half the price.
    Revenue growth means nothing if you don't have a viable business plan. Anthropic doesn't have one, except "this thing is more important than Big Bang". I don't discount the possibility that they stay afloat on borrowed money long enough to actually find a way to be profitable / rule the world. But it's nothing other than appeal to consequence right now.
    bbor · 1790642103 · focus · HN ↗
    So either your analysis is correct or the scientists begging and pleading with people to finally acknowledge what they've been saying since 2023 are correct. I know where I'll be putting my money!
    socializer · 1790643757 · focus · HN ↗
    I don't understand, scientists were pleading that Anthropic will be profitable? Doomsday predictions around AI have nothing to do with the financial outlook of a specific company.
    bbor · 1790656466 · focus · HN ↗
    I was just replying to your framing, sorry to be unclear. You said that Anthropic is counting on AI transforming the whole economy/be the "big bang". I'm saying that that bet is extremely rational -- to bet otherwise is to ignore science because its conclusions make you anxious.
    owebmaster · 1790682716 · focus · HN ↗
    Anthropic is betting they will capture this market, not that it exists.
2. kamranjon · 1790641395 · focus · HN ↗
  does anyone understand what this part actually means?
  "The near-$42 billion net loss included a roughly $34 billion accounting charge that reflected an increase in the estimated value of financing that could eventually turn into Anthropic shares, rather than money the company spent running its business."
  1. FuckButtons · 1790641806 · focus · HN ↗
    They increased the projected liability of pre-existing financial deals that include share options.
  2. runarberg · 1790641825 · focus · HN ↗
    If you truly believe that the cost of financing should not be included in your net loss (I don‘t know anything about money, so I don‘t know whether you should or not) $8 billion in net loss is also mindboggingly large number.
    As a member of the working class who believes this money is coming from systemic exploitation of the working classes, I hate it that Anthrhopic can just loose $8 billion like that. Those $8 billion could have been used elsewhere, including to mitigate the effects of the climate disaster, to educate the youth, towards social security, or to increase the wages of the working people who could have used it to pay rent, or go to the cinema, or a family trip to visit their grandma who lives in Wyoming.
    trollbridge · 1790642764 · focus · HN ↗
    Okay. About 50 million households in America earning under $50k.
    8 billion is enough to give each of them $160. Great, all of Anthropic’s spending is enough to give each family a trip to Texas Roadhouse including dessert.
    hajile · 1790699051 · focus · HN ↗
    34.5M Americans below the poverty line. Divide out that $8B and it's a little over $230 per person.
    Have you ever been in poverty? I grew up that way and the then-equivalent of $230 would have meant not skipping Christmas when I was 6. It would have meant a full refrigerator, gas for the car for a couple of months, or so many other things.
    anomaly_ · 1790645419 · focus · HN ↗
    they don't light it on fire. it circulates in the economy. plenty of working class people doing enormously well from the data centre, chip production build out.
    runarberg · 1790650418 · focus · HN ↗
    Money would circulate at least as much if used for climate solutions and even more so if given to workers. The AI build out is not benefitting workers, like hardly at all, it creates a dismal amount of jobs, and is raising utility prices for many of us.
  3. AntiRush · 1790642025 · focus · HN ↗
    This is likely a convertible debt investment from Amazon being revalued. The numbers are pretty close, there might be some smaller notes in there too.
    <a href="https://www.sec.gov/Archives/edgar/data/1018724/000101872426000014/R9.htm" rel="nofollow">https://www.sec.gov/Archives/edgar/data/1018724/000101872426...
  4. jonas21 · 1790642097 · focus · HN ↗
    Convertible notes are worth more as the valuation of the company increases and under accounting rules that’s considered an expense for the company?
    trollbridge · 1790642652 · focus · HN ↗
    Because it is, because every other shareholder gets diluted.
  5. gonzalohm · 1790642203 · focus · HN ↗
    If I understand correctly it means that they have a lot of debt and with increasing interest rates, they have to spend a significant chunk in just paying interest
3. siva7 · 1790641518 · focus · HN ↗
  I guess those 2 customers must be state actors as one of them must be spending at least 12B$ ?
  1. fr2029 · 1790661812 · focus · HN ↗
    [dead]
4. ac29 · 1790641526 · focus · HN ↗
  Not $518B in the next year, they plan "to spend $518 billion on cloud, computing and infrastructure obligations in coming years" (number of years unspecified)
  1. hajile · 1790697752 · focus · HN ↗
    Looking at Nvidia sales and even the most optimistic "use this GPU for 6 years despite its horrible inefficiency", you still get a very big number per-year.
    Google, Amazon, Oracle, Microsoft, Meta, SpaceX, and tons of other startups are spending trillions on data centers, but everyone is renting them out. They aren't renting them to each other (and paying the extra overhead when they have their own servers).
    That leaves basically just OpenAI and Anthropic on the hook to pay for everything BEFORE the GPU half of it depreciates away, but they are busy cutting prices to compete with Chinese models which runs counter to their need to increase prices to fulfill their obligations.
5. lokar · 1790641606 · focus · HN ↗
  I feel like we can't really evaluate them until we see a fairly detailed breakdown that shows inference margin, training costs and non-compute R&D
  1. fwip · 1790642435 · focus · HN ↗
    This is true. If they aren't showing the details, it's because the details make them look worse.
    esseph · 1790644672 · focus · HN ↗
    Not necessarily, it could help potential competitors or financers to better understand the market / competition.
    fwip · 1790687308 · focus · HN ↗
    That's true, my comment was not correct.
    hajile · 1790699328 · focus · HN ↗
    How would it help them? The real competition is coming from China and they don't need financials to know they are stomping Anthropic in all these areas.
    Keeping financiers of their IPO from understanding what they might be buying seems to swerve into fraud territory. Keeping their investors from knowing/understanding what the problems are also seems fraudulent.
    esseph · 1790705206 · focus · HN ↗
    > How would it help them? The real competition is coming from China
    I mean, sure, you think that and I know that many others do too.
    It's Anthropic and OpenAI mainly competing for who gets used by the US government and possibly any US business that does any contracting work, while many others get banned. So basically, Fortune 500+.
    There is also a non-zero possibility that the US Gov nationalizes the entire industry and then starts directly throwing Trillions USD into it in the name of "national security". Low % chance, but I can see it happening. Or at least the Fed Gov taking a controlling ownership stake.
    It's also possible that the US Federal Government forces NVidia to outright prevent open models via: <a href="https://venturebeat.com/infrastructure/nvidias-openshell-controls-what-ai-agents-can-access-even-when-they-ignore-instructions" rel="nofollow">https://venturebeat.com/infrastructure/nvidias-openshell-con...
6. [deleted] · 1790641762 · focus · HN ↗
  [deleted]
7. knuppar · 1790642840 · focus · HN ↗
  Factor in their margin being chewed through with every open model release.
  That spending obligation sounds extremely unlikely to be fulfilled without a bailout. Anthropic's IPO is them passing the hot potato forward.
  1. vineyardmike · 1790643801 · focus · HN ↗
    There won’t be a bailout. I doubt the obligations will even amount to anything substantial anyways.
    Many of these obligations are with the big clouds who don’t have capacity to serve them anyways. Google has said they have hundreds of billions in purchase obligations they can’t fill because they don’t have enough TPUs and data centers. Google gets a bigger marketing and investor headline, and there’s a queue behind Anthropic if they bail, so of course everyone would sign the commitments knowing the risks.
    I’m sure AWS and Azure are on the same page.
    In the worst case, many of their biggest customers have tons of GPUs (Meta, AWS), so they could always license out their raw models at steep discount to help absolve themselves of the obligations.
    Finally, in the worst case scenario, even with margin compression, they pre-purchased most of the compute so there’s not enough for the open models to run on. If Opus was the same price as Kimi/GLM, I doubt many people would pick the open models.
    owebmaster · 1790682636 · focus · HN ↗
    Yeah not sure about that. OpenAI and oracle are already losing money because of their obligations. They are already going to the worst case scenario and it's worse than you describe.

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