Disclaimer: This article is for educational purposes only and is not investment advice.
AI disclosure. Researched and drafted with the help of Claude, made by Anthropic, the company discussed. All figures are from Anthropic’s S-1; the analysis is Financial Gurkha’s.
Part of our Anthropic S-1 series. Full analysis: Inside Anthropic’s S-1: The Complete Breakdown of the IPO Filing.
The 60-Second Version#↑ Contents
| June 30, 2026 | Figure |
|---|---|
| Cash, equivalents and short-term investments | $131.7B |
| Cash from operations, first half 2026 | +$3.9B |
| Free cash flow (our calculation), first half 2026 | about +$3.4B |
| Net loss, first half 2026 | $(80.7)B |
| …of which non-cash fair-value charges | about $81B |
| Accumulated deficit | $(132.9)B, of which $113.2B is fair-value changes |
| Net property and equipment | $1.19B |
What's in this report#
- The 60-Second Version
- 1. The Balance Sheet
- 2. Why the Net Loss Is $80 Billion
- 3. Cash Flow and Free Cash Flow
- 4. Depreciation and Fixed Assets
- 5. What Changes Next
- Frequently Asked Questions
1. The Balance Sheet#↑ Contents
| ($ millions) | Dec 31, 2024 | Dec 31, 2025 | Jun 30, 2026 |
|---|---|---|---|
| Cash and cash equivalents | 3,141 | 17,388 | 112,389 |
| Short-term investments | — | 2,889 | 19,262 |
| Accounts receivable | 95 | 909 | 5,833 |
| Restricted cash | 13 | 13 | 2,529 |
| Property and equipment, net | 19 | 146 | 1,187 |
| Goodwill | — | 154 | 576 |
| Total assets | 7,752 | 24,661 | 147,358 |
| Accounts payable and accrued | 333 | 2,511 | 5,422 |
| Deferred revenue | 28 | 269 | 1,650 |
| Convertible notes payable | 14,116 | 41,677 | 108,566 |
| Total liabilities | 14,679 | 45,397 | 117,467 |
| Redeemable convertible preferred stock | 2,874 | 29,769 | 157,510 |
| Accumulated deficit | (10,040) | (52,154) | (132,902) |
| Total stockholders’ deficit | (9,801) | (50,505) | (127,619) |
The cash came mostly from investors. Anthropic raised $110.4 billion from preferred stock in the first half of 2026 alone, including:
- Series G: $23.5 billion at $25.91 per common-equivalent share, January–February.
- Series H: $45.7 billion at $58.90 per common-equivalent share, May–June, including $10 billion from Google and $5 billion from Amazon.
2. Why the Net Loss Is $80 Billion#↑ Contents
Most of the loss is the company’s rising valuation showing up as an accounting charge.
Anthropic has issued convertible notes that will become shares. As its valuation rose, those notes became more valuable, and under the accounting rules the increase counts as a loss.
| First half 2026 ($M) | |
|---|---|
| Operating loss | (693) |
| Interest income | 1,111 |
| Change in fair value of convertible notes, derivatives and SAFEs | (72,388) |
| Other income (expense), mostly fair-value recognition of other instruments | (8,757) |
| Net loss | (80,748) |
Amazon’s notes show the effect. $6.2 billion of principal converts into about 1.84 billion shares, at $2.09 and $5.05 a share. The Series H price was $58.90.
3. Cash Flow and Free Cash Flow#↑ Contents
| ($ millions) | 2023 | 2024 | 2025 | H1 2025 | H1 2026 |
|---|---|---|---|---|---|
| Net loss | (1,531) | (8,309) | (41,965) | (12,969) | (80,748) |
| + Stock-based compensation | 29 | 192 | 1,158 | 279 | 2,185 |
| + Fair-value changes (non-cash) | 1,045 | 5,434 | 34,308 | 10,942 | 72,388 |
| + Other non-cash items | 3 | 28 | 592 | 19 | 8,936 |
| ± Working capital | (1,173) | (3,037) | 3,270 | 216 | 1,168 |
| Cash from operations | (1,627) | (5,692) | (2,637) | (1,513) | 3,929 |
| Capital expenditure | (2) | (15) | (131) | (18) | (482) |
| Free cash flow (FG calculation) | (1,629) | (5,707) | (2,768) | (1,531) | 3,447 |
“Other non-cash items” combines depreciation, the donation-matching liability and other financial-instrument charges. Working capital is the sum of the operating asset and liability changes.
Anthropic does not report a free cash flow figure; this is our calculation from its statements. Part of the first-half 2026 cash came from customers paying in advance: deferred revenue rose $1.38 billion. Receivables, by contrast, used $4.98 billion as sales grew.
4. Depreciation and Fixed Assets#↑ Contents
Depreciation is tiny today because most compute has been rented as a service.
| ($ millions) | Dec 2024 | Dec 2025 | Jun 2026 |
|---|---|---|---|
| Servers, networking and infrastructure equipment | — | 34 | 618 |
| Construction in progress | 4 | 63 | 536 |
| Gross property and equipment | 23 | 158 | 1,234 |
| Accumulated depreciation | (4) | (12) | (47) |
| Net | 19 | 146 | 1,187 |
- Method: straight-line over 3 to 5 years.
- Depreciation expense: $1M (2023), $3M (2024), $10M (2025), $35M (first half 2026).
- Total depreciation and amortization: $97M in the first half of 2026.
- Leases: finance leases began in 2026, at a 7.1% weighted-average discount rate and 4.9 years remaining. Operating leases carry a 7.5% rate.
5. What Changes Next#↑ Contents
The cost of compute is moving onto the balance sheet. About $161 billion of five-year Broadcom equipment leases are accounted for as finance leases. As that hardware comes into service, it will show up as assets that are amortized, plus lease interest, rather than as a service expense. Spread over five years, that is on the order of $30 billion a year once fully in service. This is our illustration, not a company estimate.
The filing is also explicit that cash flow will turn more negative as it builds. It expects “significant net cash used in operating and investing activities for the foreseeable future,” with payments made “well in advance” of compute coming online.
The covenant to watch: Anthropic’s $15 billion credit line requires at least $5 billion of liquidity at the end of each quarter, starting December 31, 2026.
Frequently Asked Questions#↑ Contents
How much cash does Anthropic have? $112.4 billion of cash and cash equivalents and $19.3 billion of short-term investments as of June 30, 2026: $131.7 billion in total.
Why did Anthropic lose $80 billion in the first half of 2026? Almost all of it is non-cash. $72.4 billion came from increases in the fair value of convertible notes and similar instruments as Anthropic’s valuation rose, and $8.8 billion from recognizing other financial instruments. Operating loss was only $693 million, and the second quarter was profitable.
Does Anthropic generate free cash flow? For the first time, yes. Operating cash flow was $3.93 billion in the first half of 2026 and capital expenditure $482 million, implying about $3.45 billion of free cash flow by our calculation. The company expects heavy investment to turn cash flow negative again.
Read the complete analysis: Inside Anthropic’s S-1: The Complete Breakdown of the IPO Filing
Methodology and Sources#↑ Contents
From Anthropic, PBC’s Form S-1 filed October 26, 2026: the consolidated balance sheets, statements of operations and cash flows, and Notes 6, 7 and 13. Free cash flow, the cash-flow groupings and the amortization illustration are Financial Gurkha calculations. SEC EDGAR.