The debate over artificial intelligence is keeping IPOs stuck on the launching pad, and with the shadow of Anthropic PBC's market debut looming larger by the day, billions of dollars of capital and months of preparations are hanging in the balance. "People are truly paralyzed," said West Riggs, head of equity capital markets at Truist Financial Corp. "The market has to sort itself out."
AI infrastructure companies teeing up US listings, including London-based Nscale Ltd. and Singapore's Day One Data Centers Ltd., continue to pitch investors on their central importance to the sector's buildout. Yet with shares of peers such as Core Weave Inc. plunging, investors' appetite for risk-taking has evaporated. That puts October on track for the slowest month of the year by US IPO volume, compared with a roaring pace that saw $162.6 billion raised through the end of September. Wall Street is pinning its hopes for a record fee year on Anthropic's anticipated debut next month, which could raise as much or more than SpaceX's listing.
Riggs said, "It doesn't feel too encouraging for the rest of 2026. There's a lot of optimism for 2027, particularly in software, but overall things feel pretty sluggish from an IPO perspective." Signs of market strain emerged when smart-ring maker Oura Inc. and Bamboo Insurance Services Inc. were forced to postpone debuts as interest rates climbed and the Iran war dragged on. Oura's offering faced pushback from prospective investors over a potential fully diluted valuation of about $15 billion.
Deloitte & Touche's Will Braeutigam, US capital markets transactions leader, says the bid-ask spread on valuation has "blown out," calling it a stalemate that must be resolved before the broader market can move forward. With just $587.7 million raised through US IPOs since the end of September, excluding blank-check firms and other financial vehicles, the fourth quarter is shaping up to be weak for every company except Anthropic. Braeutigam anticipates six or fewer companies will raise $500 million or more on US exchanges through year-end, adding that most clients are focused on Q2.
Source: Bloomberg Markets · Summarized by HeadlinesBriefing