Anthropic IPO valuation drops to $1.5 trillion as AI bubble index rises

Anthropic's initial public offering is facing significant headwinds, with its valuation expected to drop to $1.5 trillion from a previously targeted $2 trillion amid turmoil in the artificial intelligence sector. The valuation cut follows a turbulent period for AI stocks, including Nvidia entering a correction and declines in AMD, CoreWeave, and IREN. Anthropic's S1 filing showed accelerating revenue of $17 billion in Q3 but also revealed a $23 billion quarterly loss, largely from a non-cash charge on convertible bonds, plus heavy reliance on a few key clients. Investor concerns are heightened by a rising AI bubble index and recent IPO flops, such as SpaceX and CoreWeave, which saw sharp post-listing declines. Anthropic's heavy spending on compute deals with CoreWeave and others also delays its path to positive free cash flow.