Amazon is seeing massive gains from its investment in Anthropic.
The cloud giant estimated the fair value of its stake in Anthropic at $14 billion at the end of December, according to a recent regulatory filing. That's up from $8 billion, the filing shows.
That means Amazon's investments have soared roughly 75% since it started backing the AI startup in 2023, for a cool $6 billion gain on paper.
Amazon first invested $1.25 billion in Anthropic in September 2023 and another $2.75 billion in the first quarter of 2024. Late last year, Amazon put in another $1.3 billion, and also agreed to invest an additional $2.7 billion by the end of 2025, the filing stated.
Amazon's spokesperson declined to comment.
In the filing, Amazon said it used convertible notes to invest in Anthropic. These are classified as "available-for-sale," an accounting term generally denoting securities expected to be held for more than a year. Convertible notes can be exchanged for equity in the future, depending on how they are structured and certain thresholds.
There are a lot of assumptions baked into Amazon's fair value estimates. This is common for investments in startups, which are often young businesses that could either succeed or fail over the long term. Amazon's filing classified the convertible notes as "Level 3" assets, which use "valuations based on unobservable inputs reflecting our own assumptions, consistent with reasonably available assumptions made by other market participants."
"These valuations require significant judgment," the company added.
Anthropic is one of the leading AI startups, best known for its Claude family of models and related services. The OpenAI rival is currently raising money at a $60 billion valuation, a significant jump from the $18 billion value it saw last year, according to the Wall Street Journal.
Amazon has built a close relationship with Anthropic in recent years. In addition to the funding, Anthropic agreed to use Amazon's cloud computing services and AI chips. Last year, Anthropic said it plans to use a new AI supercomputer made up of Amazon-made chip clusters.
Amazon's total investment value in public and private companies was $22.1 billion as of the end of December, the filing said. Publicly traded companies, such as Rivian, accounted for just $4.6 billion. Among the private companies Amazon invested in are Scale AI, Hugging Face, and X-energy, according to Pitchbook.
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