Anthropic IPO news: AI giant to raise $25 billion as valuation soars

• Sequoia Capital is investing $1.5 billion as part of the $25 billion fundraising round, valuing Anthropic at $350 billion compared to OpenAI's $500 billion and xAI's $230-235 billion valuations
• Anthropic generated $9 billion ARR in 2025, expects $20 billion in 2026, and projects $70 billion in revenue with $17 billion free cash flow by 2028 when it aims to break even
• The company operates more efficiently than OpenAI with $4.2 billion in 2025 revenue and $3 billion cash burn versus OpenAI's $13 billion revenue and $9 billion cash burn, avoiding costly image and video generation investments

Summary

Key Development:

Anthropic, creator of the Claude AI assistant, is planning an IPO later in 2026 while pursuing a major funding round. The company seeks to raise $25 billion at a $350 billion valuation, positioning it among the world's largest private companies.

Funding Details:

Sequoia Capital leads the round with a $1.5 billion investment, joined by Coatue and GIC. Previous investors include Amazon (largest backer through AWS partnership), Fidelity, Blackstone, and General Catalyst.

Financial Performance:

• 2025 Annual Run Rate (ARR): $9 billion
• Projected 2026 ARR: $20 billion
• 2028 revenue target: $70 billion with $17 billion free cash flow
• 2025 estimated revenue: $4.2 billion with $3 billion cash burn
• Target profitability: 2028
• Corporate clients: 300,000+

Competitive Landscape:

Anthropic's $350 billion valuation trails OpenAI ($500+ billion) but exceeds Elon Musk's xAI ($230-235 billion). Unlike OpenAI, Anthropic pursues a more cost-efficient strategy, avoiding expensive ventures into image/video generation. OpenAI generated $13 billion revenue in 2025 but burned $9 billion, with data center commitments exceeding $1.4 trillion.

Market Implications:

2026 is shaping up as a significant year for AI IPOs, with Anthropic, OpenAI, and others expected to go public. Anthropic's growth is driven by enterprise partnerships with Microsoft, Deloitte, Salesforce, and Allianz. The company's relatively disciplined spending approach and strong revenue trajectory make it an attractive investment opportunity, potentially delivering substantial returns for early-stage investors.