Anthropic IPO: A critical moment for AI stock recovery

Cramer stated that a successful IPO is necessary for a genuine rebound in AI-related stocks. The Claude developer recently submitted its S-1 IPO paperwork, and despite recent declines in AI stock values, the company is proceeding with its plans. Sources familiar with the situation, as reported by the Wall Street Journal, suggest Anthropic intends to meet with major investors this week, with a potential trading debut anticipated as early as Thursday or Friday of next week. Cramer described the offering as potentially “one of the most consequential IPOs in history.”

Cramer emphasized that the substantial investments currently being made in AI chips and data centers are contingent upon a few key AI developers, including Anthropic, generating sufficient revenue to justify those expenditures.

“Anthropic is important because it is one of just a few companies at the end of the food chain for all of the AI data center investments that we’ve seen, so it is one of the few companies that, ultimately, needs to make money from all of this investment spending,” Cramer explained. He added that failure to convince investors of its potential could jeopardize current AI investments.

SpaceX offers a compelling example of the interconnectedness within the AI landscape. A significant portion of SpaceX’s recent revenue growth stems from leasing computing capacity, with Google and Anthropic among its clients. Google’s monthly payments are approximately $900 million, while Anthropic’s commitment has increased from an initial $1.25 billion to over $3 billion, as detailed in its IPO prospectus.

These contracts underpin SpaceX’s substantial purchases of Nvidia chips. Cramer questioned what would happen if an Anthropic deal were to fail, suggesting it could lead to contract fulfillment issues, revised earnings estimates for SpaceX and Nvidia, and impacts on other compute providers and their suppliers. Alphabet, Amazon, and Nvidia have also invested in Anthropic, making their financial performance sensitive to changes in Anthropic’s valuation.

However, investor enthusiasm for the Anthropic IPO appears to be diminishing. The company’s potential valuation has reportedly decreased from a peak of $2 trillion earlier this fall to as low as $1 trillion, influenced by last week’s technology sell-off and concerns about potential delays in new data center construction due to the recent election results. Cramer reiterated the significance of the offering during the CNBC Investing Club’s Annual Meeting on Friday, particularly for Alphabet, Amazon, and Nvidia.