Anthropic's Potential $1.2 Trillion IPO Could Make This Stock a Major Beneficiary
Amazon has a large stake in Anthropic.
Overview
Anthropic is moving closer to an IPO, with a potential October debut on the table. The maker of the Claude frontier large language model (LLM) was last valued at $965 billion in its last funding round in May. However, secondary market transactions have recently been valuing the company at around $1.2 trillion.
While investors eagerly await Anthropic going public, one company is set to see a big windfall from its investment. That company is Amazon (NASDAQ: AMZN). The e-commerce and cloud computing giant has invested around $13 billion in the LLM maker and reportedly owns between a 15% and 20% stake in the company. With its most recent investment in April, it also agreed to invest an additional $20 billion if "certain commercial milestones" were met.
Details
At a $1.2 trillion valuation, Amazon's stake in Anthropic would be worth between $180 billion and $240 billion. That's a nice return on a relatively modest investment. However, the Anthropic IPO will do more for Amazon than just give it a nice investment gain. As part of its latest investment, Amazon received more than $100 billion in commitments from Anthropic over the next decade. This includes up to 5 gigawatts (GW) of capacity for training and running Claude, as well as for future iterations of its Trainium AI chips and Graviton central processing units (CPUs).
Source
Originally published at www.fool.com.