Damodaran Values Anthropic at $1.475T, 32x Its Q2 Run Rate

Aswath Damodaran, the NYU Stern professor who writes the Musings on Markets blog, published his valuation of Anthropic on 28 October 2026, two days after the company filed its prospectus. According to Damodaran’s post, his estimate of the value of Anthropic’s equity is $1.475 trillion, “at the lower end of the offer pricing range ($1.5 to $2 trillion)”.

By our arithmetic, $1.475 trillion is about 32 times Anthropic’s second-quarter 2026 revenue of $11,555 million annualized, using the quarterly figures in its S-1. Damodaran presents the number as his own estimate, made, in his words, “at the risk of being called hopelessly wrong by both bulls and bears”.

Business Pill · Run-Rate Revenue

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The Inputs Behind His Number

Damodaran writes that he believes “it is plausible that Anthropic’s revenues could approach a trillion dollars in a decade”. He bases that on an end market for AI products of $5 trillion or more and on Anthropic aiming for the premium portion of that market.

For margins, he assumes 75% of revenues from premium products and 25% from the mass market, giving an unadjusted pre-tax operating margin of 32.5%. He then cuts that to 27.5% for regulation, writing that it will shave his estimate “down to 27.5% (a reduction of 5%)”.

On reinvestment, he assumes Anthropic “will need to invest about $1 for every $3 in additional revenues, going forward”. His cost of capital is 9.74%, against what he gives as a median of 9.16% for US firms in September 2026. He also assigns a 10% probability of failure, with a loss of half its value if that happens.

He adds that his cash balance includes an estimated $100 billion in proceeds from the offering, and that his debt figure includes his estimate of the present value of Anthropic’s compute commitments.

What Was Posted on X

Rohan Paul’s post says Damodaran published a long post valuing Anthropic at $1.475T and quotes his line that the voting setup would put Kim Jong Un to shame.

The Range Around It

Damodaran also publishes two bounds. In his worst case, target revenues reach $200 billion in 2036, margins settle at 10% and the cost of capital is 9.88%; he writes that “the value of equity is -$373 billion”. In his best case, target revenues reach $1.5 trillion, margins reach 40% and the cost of capital is 7.79%, which “yields a value of $4.04 trillion for equity”.

He describes both as possible but unlikely, and he has published his spreadsheet and a shared sheet where readers can enter their own inputs.

What He Read in the Prospectus

Damodaran writes that revenues in the first two quarters of 2026 were “about fourteen times as high as the revenues in the first two quarters of the last year”. The S-1 quarterly table gives $16,286 million for the first half of 2026 against $1,163 million a year earlier, which is 14.0 times by our arithmetic.

He also writes that growth slowed in the third quarter, that the reported first-half loss of $80 billion included a $72 billion non-cash charge, and that compute costs fell from more than 250% of revenues to 48% on a quarterly basis. He cites compute commitments “in excess of $600 billion” and a bond rating of BB+.

Governance and the Lock-Up

Damodaran notes five classes of shares and describes a voting structure with a benefit trust picking the board and “the founders controlling 50.1% of voting”. Alongside the public benefit corporation structure, he describes the voting share design as “so deviously self-serving that it would put Kim Jong Un to shame”.

On lock-ups, he writes that insiders other than founders and certain major figures will be able to sell up to 10% of their shares on the first trading day, with founders and key named figures able to trade after 365 days. He says he thinks “too much is made of share unlocking”.

On trading, he writes that if Anthropic “is priced well above my estimate of $1.48 trillion, I will sit out the frenzy”, and explains why he would not sell short.

How It Compares

On 22 October, before the prospectus, Damodaran set out what market caps of $1.5 trillion and $2 trillion would imply against an annualized revenue run rate of $65 billion. Against that $65 billion, his $1.475 trillion value is about 22.7 times, by our arithmetic.

Against the S-1 numbers, it is about 45 times first-half 2026 revenue doubled, and his trillion-dollar revenue target for 2036 is about 21.6 times the second-quarter run rate. That implies average growth of about 36% a year over ten years from the second-quarter level, by our arithmetic.

The Structural Read

As we read the post, the number rests on four inputs he sets out one by one: about a trillion dollars of revenue by 2036, a 27.5% operating margin after a regulatory cut, $1 of investment per $3 of added revenue, and a 9.74% cost of capital.

As we read the range he publishes, the gap between his worst case of -$373 billion and his best case of $4.04 trillion is wider than his base case itself.

Damodaran writes that he will sit out the offering if it is priced well above his estimate, and explains why he would not sell short.

Three Implications

FOR IPO BUYERS Damodaran puts his base case at the lower end of the $1.5 trillion to $2 trillion range he cites, and publishes worst and best cases of -$373 billion and $4.04 trillion.

FOR GOVERNANCE He notes five share classes and founders controlling 50.1% of voting, alongside a public benefit corporation structure.

FOR THE COMPUTE BILL He cites compute commitments in excess of $600 billion and assumes $1 of investment for every $3 of additional revenue.

The Business Engineer Lens

This story maps onto the Business Engineer framework The AI Capex Map.

The framework says of itself: “This piece is about the financing.” It sets out to trace how the money flows, where it cracks, what it buys and who can absorb it.

Damodaran’s valuation treats Anthropic’s compute commitments as debt-like obligations in his inputs. The framework was published before the prospectus and does not discuss his valuation.

What Is Not Established

The $1.475 trillion is one analyst’s estimate, built on his own forecasts of revenue, margins, reinvestment and risk; it is not a market price or a company figure. The $1.5 trillion to $2 trillion range is Damodaran’s description, and Anthropic has not priced its offering.

Our multiples divide his value by revenue figures from the S-1 or his earlier post and are not measures he reports. The 36% growth figure is a mechanical calculation, not a forecast.

The Bottom Line

Damodaran values Anthropic’s equity at $1.475 trillion, at the lower end of what he calls the $1.5 trillion to $2 trillion offer pricing range, with bounds of -$373 billion and $4.04 trillion. By our arithmetic, his base case is about 32 times the company’s second-quarter 2026 revenue annualized.