NEW YORK CITY, New York: Anthropic, the AI lab best known for its Claude chatbot, is aiming for a valuation of up to US$1.4 trillion in its blockbuster IPO. That's slightly short of some investors' expectations amid cooling AI appetite, setting up a defining test of Wall Street's faith in the boom that it helped ignite.

Anthropic and some of its investors are aiming to raise up to $64.4 billion by selling 825 million shares priced between $70 and $78 apiece. The company will also raise $26 billion via a separate private placement deal with cornerstone investors, including Alphabet's Google, Nvidia, and Advanced Micro Devices.

Together with investments from cornerstones, which also include Broadcom, Micron Technology, Microsoft and TSMC, Anthropic's share offering will raise up to $90.4 billion. Certain Anthropic board members and related entities are set to buy up to $303 million of shares.

At the top of the price range, Anthropic would be valued at about $1.4 trillion on a fully diluted basis, which includes securities such as stock options and restricted stock. On a non-diluted basis, Anthropic's market value would be about $1 trillion. The company was last valued at $965 billion in a private funding round.

"By seeking a valuation close to 20 percent below ‘market expectations', this allows investors to ‘bid up' the IPO rather than facing a take-it-or-leave-it scenario as SpaceX took," said Jeff Zell, senior research analyst at IPO Boutique.

Investors had previously discussed a valuation of as much as $2 trillion, but expectations have since come down given Anthropic's substantial infrastructure commitments and recent volatility in AI-related stocks, Reuters previously reported.

Hours before Anthropic filed an updated prospectus on November 10, details of its IPO were briefly circulated to investment banks late on November 9, then retracted, according to emails seen by Reuters. The preliminary terms showed the IPO could raise as much as $69.3 billion.

"The timing of this IPO likely contributed to the lighter valuation and lighter cash raise. With market volatility persisting in this sector, getting the pricing ‘right' is crucial to its long-term success," Zell said.

Anthropic's run-rate revenue was roughly $81 billion as of October 31, up $10 billion from September 30, according to the IPO filing. The company has nearly $900 billion in computing commitments with partners including Amazon and Google. That highlights how its rapid growth depends on securing vast amounts of future computing capacity, some of which relies on financing beyond the company's control.

The prospectus warned that competitors could gain an edge by developing models faster and that advances in AI could outpace Anthropic's ability to implement adequate safety and security measures. Its filing spoke of a vision to "bring forth an age of miracles," even as it warned of existential risks to humanity.

Investors are also closely watching the IPO for clues about rival OpenAI, which is seeking to raise $30 billion in what is expected to be its final private funding round before a potential IPO early next year. The second half of the year has brought a reckoning for the AI boom, as investors question whether returns will justify the massive spending and mounting debt costs in an elevated interest-rate environment.

The listing follows Elon Musk's SpaceX raising $75 billion, at a nearly $1.75 trillion valuation.

Anthropic was founded in 2021 and is led by CEO Dario Amodei. Goldman Sachs and Morgan Stanley are leading investment banks underwriting the offering, and Anthropic shares are expected to trade on the Nasdaq under the symbol "ANT".