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subtlesoftware

This piece was published in mid-October based on rumored numbers.

Anthropic released their Q3 numbers today which show:

- $16.96B in revenue Q3

- Up 47% quarter over quarter (Q2 was $11.6B)

- Up >1000% year over year

I wouldn't say their growth "flattened"? Their price drops in September dramatically increased Claude token consumption per OpenRouter

Sources: https://www.anthropic.com/news/s1-sec; https://openrouter.ai/anthropic

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Anthropic S1 had numbers up till Q2. Many people speculated that Q3 numbers were lower because many companies had moved away from "token as measure of productivity" or tokenmaxxing. Anthropic Q3 numbers proved that theory.

As the article notes the growth is still huge. But it has slowed down relative to what they were growing.

> $16.96B in revenue Q3

The article used $16.8B. Not a big difference.

Why do we keep talking about revenue and not profit? This feels like when Michael Scott opened a paper company and the accountant had to tell him-

“At these prices, the more paper you sell, the less money you'll make."

https://isaiprofitable.com/

because revenue growth is much more important at this stage, and investors are underwriting based on the first and second derivative

We talk about revenue far later in a company’s lifecycle than we did before because high-tech, high-capex companies take a long time to become profitable.

Amazon is now the posterchild for this, but it happens in other industries like pharma a lot too. And in today’s stock market, where a fundamentally weak company like Tesla can trade at eye-watering multiples because of speculation, why worry about profitability at all? (Partly joking but that’s how people think.)

When and why we start expecting Anthropic to be profitable are great questions though.

Amazon has the world on lockdown though as the best place to buy stuff and get almost anything to my house in a day or so. I can use any AI model out there at ever decreasing razor thin margins and there is no moat or lock in at all. Nor do most people even need AI. I’ve certainly never and would never pay for AI anything. Anthropic is basically in the paper business, AI is a commodity at best, but maybe worse, because people actually need paper.

Amazon was unprofitable and not at all dominant for many years before reaching its current status. Books and groceries are also a race to the bottom of margins.

Is it high-capex, though? What assets do they have?

Up 47% quarter over quarter when the previous quarter was up 145% quarter over quarter and close to that the quarter before. "Growth flattened" is generous.

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