Michael Burry has intensified his criticism of Anthropic's valuation, comparing the company's worth to 78 profitable S&P 500 companies in a detailed analysis posted on X. According to Burry's latest calculations, the company's $965 billion private valuation from May 2026 is equivalent to buying Domino's Pizza, Clorox, Smucker, Stanley Black & Decker, Deckers, lululemon, McCormick, Tractor Supply, NVR, Albemarle, FedEx Freight, News Corp, Alliant Energy, Kimco Realty, Hormel Foods, Clorox, Weyerhaeuser, DaVita, Zimmer Biomet, Lennox, Masco, A.O. Smith, MGM, Wynn, Brown-Forman, Norwegian Cruise Lines, Huntington Ingalls, and many more. The comparison highlights the stark contrast between Anthropic's private valuation and established businesses with decades of operating history and established customer bases. Burry emphasized that this exercise demonstrates 'how many profitable public companies one can buy with the bubble private company valuation', questioning whether investors are paying appropriate prices for future AI growth versus established companies with proven revenue and profitability.
Anthropic's planned mega-IPO faces an unusual valuation challenge as investors grapple with existential AI safety risks. Researchers posting on X about a 10% chance or greater that AI would wipe out humanity sparked a discussion that Anthropic's co-founder and CEO Dario Amodei weighed in on, outlining concerns about humans losing control of AI systems, potential misuse for cyberattacks and bioterrorism, and serious economic disruption if top researchers don't slow development. While observers scoffed at the idea that a company could be held liable for killing off the species, the risks to Anthropic and rival OpenAI resemble those faced by companies handling hazardous materials or military hardware. According to Slow Ventures partner Sam Lessin, the liabilities might be a $2 trillion or $4 trillion risk to society, making the companies worth less than zero overall.
The stark valuation disparity becomes clear when comparing Anthropic's losses to industry leaders. As reported by Reuters, Anthropic reported a net operating loss of over $8 billion in 2025, while overall losses soared to $42 billion. In contrast, Nvidia - the world's most valuable company with a market capitalization of nearly $6 trillion - has generated net profit of nearly $190 billion over the last four quarters. According to New Constructs, Anthropic would need to record double the trailing year profit of Nvidia to justify its desired valuation, a benchmark that appears increasingly difficult given the company's mounting operational losses and emerging competition from open-source AI models. New Constructs estimates that reaching Anthropic's reported $2 trillion target would require twice Nvidia's trailing profit, making it difficult to justify the massive valuation gap.
Michael Burry has expanded his criticism beyond valuations to warn about the enormous amounts being spent on artificial intelligence infrastructure. According to Burry's latest analysis, technology companies and cloud providers are committing hundreds of billions of dollars to data centres, advanced chips, computing capacity and other infrastructure needed to support artificial intelligence. Burry believes 'some of this spending could eventually lose much of its value if the economics of artificial intelligence change', writing that 'Ultimately, compression will do its deed, and much of what is being spent will be just so much sunk cost'. He has previously described 'compression' as a process that begins when the benchmark phase ends and companies start reducing their use of third-party tokens. If artificial intelligence becomes cheaper and more efficient to operate, companies may not need as much computing infrastructure as investors currently expect, potentially leaving some of the huge investments made today generating lower returns than expected.
According to reports from Reuters, Anthropic is preparing what could become the largest stock market debut ever, with bankers discussing raising as much as $100 billion at a $2 trillion valuation. The company filed confidentially for a US IPO in June, moving ahead of rival OpenAI in the race to reach public markets. The draft prospectus reveals a company growing at unprecedented speeds while carrying massive operational costs. At $2 trillion, Anthropic would be valued at roughly 31 times its July run rate and about 10 times the revenue it projects for 2028. The valuation therefore depends almost entirely on the run rate holding up, with the company projecting 2028 revenue of about $190-200 billion. Altimeter Capital, Dragoneer, Greenoaks, and Sequoia Capital led the $65 billion round that set the $965 billion mark, with the company targeting a listing before Thanksgiving. However, New Constructs has called the planned listing the 'most ridiculous IPO of 2026'.
