Google has decided that if you can't beat 'em, you should just give them a pile of cash and some computing power. The Alphabet subsidiary is committing $10 billion immediately at a valuation of $350 billion for Anthropic, with an additional $30 billion contingent on the AI firm hitting certain performance targets. Because nothing says "healthy competition" like handing your rival $40 billion.
This investment comes hot on the heels of Anthropic releasing its latest model, Mythos, to a select group of partners. Anthropic claims Mythos is its most powerful model yet, with significant cybersecurity applications. They've wisely restricted broader access due to potential misuse - though, in classic AI fashion, the model has already found its way into unsanctioned hands. It's also presumably expensive to run at scale, which is probably why Anthropic is so keen on securing all that compute.
The AI race has become less about who has the best ideas and more about who has the biggest data center. OpenAI has been securing its compute through a web of deals with cloud providers, chip suppliers, and energy companies, including an expanded partnership with chipmaker Cerebras. Anthropic has been scrambling to keep up, facing widespread complaints about Claude usage limits and responding with a flurry of infrastructure deals. Earlier this month, they struck a deal with CoreWeave for data center capacity, and this week they secured an additional $5 billion from Amazon as part of a broader agreement that could see Anthropic spending up to $100 billion on compute capacity.
Google is both a direct competitor and a key infrastructure supplier to Anthropic. Anthropic relies heavily on Google Cloud for its tensor processing units (TPUs), which are specialized chips designed for AI workloads and considered among the best alternatives to Nvidia's in-demand processors. It's a cozy arrangement: Google gets to keep an eye on its rival while profiting from their success.
Anthropic's relationship with Google predates this week's news. Earlier this month, they announced a partnership with Google and chipmaker Broadcom to access multiple gigawatts of TPU-based computing capacity beginning in 2027. A subsequent Broadcom securities filing put that figure at 3.5 gigawatts. The new investment expands that arrangement, with Google Cloud providing an additional 5 gigawatts of capacity over the next five years, with room to scale further.
Anthropic's valuation stood at $350 billion as recently as February, but investors are now eager to back the company at $800 billion or more. The company is also reportedly considering an IPO as soon as October. Because nothing says "stable investment" like an AI company that's burning through cash faster than a teenager with their first credit card.