Just as public markets are growing increasingly skeptical over the AI trade, private investors are reportedly reconsidering Anthropic's mind-blowingly high $2 trillion valuation.

Why it matters: What a year this week has been.

🕸️ The big picture: Anthropic sits at the economic center of the AI boom, and its coming IPO could ripple through the AI trade at a time of many ripples.

• Its nearly $900 billion in compute and infrastructure commitments ties its fortunes to companies across the AI economy, from chip manufacturers and networking companies to data center operators and power suppliers.

‼️ Stunning stat: Anthropic's valuation being discussed today is about $1 trillion lower than just a month ago.

• It entered October targeting $2 trillion.
• After AI stocks plummeted yesterday, and investors considered the possible effects of Tuesday's midterms, discussions of Anthropic's valuation had fallen as low as $1 trillion, WSJ reported.

🔄 The intrigue: The IPO — if it happens later in November — would have an equally sizable impact on public markets.

• Max Kettner, chief multi-asset strategist at HSBC, described the current AI trade in an interview with Bloomberg Radio as driven by a series of narratives. And right now that narrative — which he doesn't believe — is that the AI cycle is dead.
• Anthropic's IPO is a key catalyst to change it — but that could mean pricing the IPO at a lower valuation.
• The worst-case scenario for an already shaky AI trade is a repeat of SpaceX's IPO, Kettner said — where initial buying euphoria quickly reversed, and the stock stayed mired under its offering price for over a month.

The bottom line: Anthropic's IPO could help the battered AI trade regain its footing — or provide another reason for investors to run for the exits.

Go deeper

Microsoft is reportedly ending its arrangements to rent AI computing from Oracle.

• The news sent Oracle's stock down over 5 percentage points this afternoon before it clawed back into the green. It ended the day up 0.8%, Pete writes.

Zoom in: The deal, in place since 2023, included computing capacity powered by older-generation Nvidia chips, which was becoming less useful for Microsoft, Bloomberg reported.

• It comes amid a larger effort from Microsoft to move away from compute deals with neocloud providers.

Oracle posted a public statement on X this afternoon saying demand for its AI infrastructure "remains strong, including for earlier-generation GPUs."

💉 Moderna lifted its full-year revenue forecast and turned in a profitable quarter, citing geographic expansion and strong COVID vaccine sales in international markets. (CNBC)

📊 The U.S. economy added 165,000 jobs in October, surpassing estimates, while the unemployment rate ticked down to 4.1%. (Axios)

Cybertruck, we hardly knew you.

• Elon Musk says Tesla will wind down production next year to make room for its autonomous Cybercab, Axios Future of Mobility author Joann Muller writes.
• Musk once envisioned selling at least 250,000 Cybertrucks a year. Sales peaked below 40,000 in 2024 and have been falling ever since.

Flashback: Tesla's futuristic truck got off to a rocky start in 2019 when its supposedly unbreakable windows shattered during a demonstration.

What went wrong: Owners complained of rust spots, stuck accelerator pedals and malfunctioning windshield wipers. Some even found their rugged trucks stranded in snow or sand.

• Tesla recalled the Cybertruck 11 times, including twice to reattach stainless steel trim pieces that could fly off while driving.
• Neither the truck's $39,900 price target nor its promised 500-mile driving range ever materialized. Most buyers paid closer to $100,000.

The irony: Automotive journalists generally admired its engineering.

The bottom line: The stainless-steel, sharp-edged behemoth attracted plenty of attention, but not enough buyers.