Michael Burry Won't Touch Anthropic's $1.4 Trillion IPO as He Warns of a Dangerous AI Spending Gamble

Michael Burry, the investor known for betting against subprime mortgage securities ahead of the 2008 financial crisis, says he has no plans to buy Anthropic shares before the artificial intelligence company's proposed Nasdaq listing.

Six days after his post, a 10 November SEC filing put Anthropic's aggregate commitments at $900.9 billion (£671 billion), including $161.2 billion (£120 billion) in rent under equipment leases involving Broadcom Inc.

In a 4 November post on his Substack newsletter, Cassandra Unchained, Burry wrote: 'I have no plans to pursue shares of Anthropic, and I do not expect to be a shareholder anytime soon.' His post followed Anthropic's 2 November IPO amendment, which disclosed about $895.4 billion in commitments.

Burry Questions Anthropic's Valuation Ahead of IPO

Burry challenged Anthropic's valuation, writing: 'Not only is the company priced for optimism, it is betting its entire existence on that optimism.'

The 10 November amendment updated aggregate committed spend to $900.9 billion. The figure includes purchases, leases and short-term commitments, including leases not yet commenced, but excludes arrangements without fixed dollar commitments.

Anthropic expects $451.6 billion (£336 billion) to be incurred before the end of 2030, with substantially all of the remainder expected between 2031 and 2045. About $70.7 billion (£52.7 billion) is due in the 12 months after 30 September 2026, including $4.2 billion subject to conditions or termination rights before commencement.

Broadcom Leases Carry $161.2 Billion in Rent

Anthropic's prospectus lists five-year master equipment leases with Broadcom and financing entities, carrying aggregate rent of about $161.2 billion, excluding interest. Payments are quarterly and generally begin when equipment is ready for service. The leases are non-cancellable during their terms, except where the lessor exercises default rights.

They provide TPU-based compute capacity, a portion of which began coming online in 2026, with more expected from 2027. The 2026 Lease Arrangement accounts for $125.2 billion of the total.

Anthropic can issue up to $42 billion (£31.3 billion) in convertible promissory notes under the Infrastructure Partner 2026 NPA, subject to specified conditions, solely to fund quarterly rent on the 2026 lease. No notes were outstanding at 30 September, and the draw period had not begun.

Accrued interest is added to principal at 9% a year, rising to 13% when specified revenue conditions are not met. Holders may convert the notes into non-voting Class N shares at 90% of the 30-day trailing volume-weighted average price of Class A shares, or 85% when those conditions are not met.

Revenue Growth Faces Heavy Infrastructure Spending

Anthropic reported revenue of $33.2 billion (£24.7 billion) for the nine months ended 30 September 2026, up from $2.5 billion a year earlier. Compute and infrastructure expenses rose to $18.8 billion (£14 billion), from $4.4 billion, but fell to 57% of revenue from 172% in the same period of 2025.

Liquidity stood at $146.6 billion (£109.2 billion) at 30 September, before proceeds from the proposed IPO and concurrent private placement. It comprised $95.6 billion in cash and cash equivalents, $36.3 billion in short-term investments and $14.8 billion available under its credit facility. Anthropic estimates net proceeds of about $84.6 billion (£63 billion) from both transactions, based on an assumed $74 share price.

Strategic Partnerships Create Additional Infrastructure Risks

Anthropic identifies Amazon, Google and Microsoft as investors, customers, distribution partners and competitors. Broadcom is both a supplier and lessor. The company says these overlapping relationships could create conflicts and affect access to computing capacity, pricing and commercial terms.

The filing also lists minimum-purchase and take-or-pay terms in long-term computing agreements. Burry said the terms could leave Anthropic paying for compute 'at a time when it is not needed'. The prospectus says such agreements can require payment for contracted capacity regardless of actual use.