Anthropic is one of the market's most hotly anticipated IPOs, with investors eagerly awaiting the company's announcement that it's going public. The large language model (LLM) maker has been seeing explosive growth, with its revenue reportedly set to double quarter over quarter, from $4.8 billion in Q1 to $10.9 billion in Q2. This acceleration also isn't growth at any cost, as the company is expected to turn in an operating profit of $559 million in Q2.
While it offers a consumer product, Anthropic has made its mark by focusing on the enterprise market, where it generates about 80% of its revenue. The company has found a strong niche in coding, with its Claude Cowork and Claude Code products helping drive its growth.
Anthropic has drawn investments from several large companies, including Amazon and Alphabet. However, there is an under-the-radar stock that's set to benefit much more from Anthropic's success than these behemoths. That company is video-conferencing platform operator, Zoom (ZM 0.39%).
NASDAQ: ZM
Key Data Points
An early Anthropic investor
Zoom's investment arm, Zoom Ventures, took a stake in Anthropic in May 2023. While the original size of the investment hasn't been disclosed, it's widely believed to have been the bulk of the $51 million in investments it made during the quarter. Zoom later made another $46 million investment in Anthropic preferred shares in Q1. In its latest 10-Q filing, it said its total investment was valued at $1.27 billion based on Anthropic's February valuation round, which was done at $380 billion.
However, fast forward a few months, and Anthropic is looking to raise funds at an over $900 billion valuation this month. That would value Zoom's Anthropic holding at over $3 billion. Meanwhile, given its growth, it wouldn't be surprising to see the company eventually IPO at a much higher market cap.
Zoom currently has a market cap of around $31 billion. It also has $7.7 billion in cash and marketable securities to go along with its Anthropic investment and no debt. That means its core business is currently being valued closer to $20 billion. The company is also generating around $2 billion in free cash flow a year.
Image source: Getty Images.
The company's core business has also been showing some signs of life. Revenue rose 5.5% last quarter, with enterprise revenue climbing 7.2%. It also saw its number of customers with more than $100,000 in trailing revenue jump 8.2%.
With Anthropic worth about 13% of Zoom's enterprise value and the company generating a ton of cash and seeing revenue growth, buying Zoom stock can be a sneaky way to play Anthropic before its IPO.
