Google to invest up to $40B in Anthropic in cash and compute

Google plans to invest up to $40 billion in Anthropic and support the AI ​​company’s growing computing needs. Bloomberg reports. The Alphabet subsidiary now pledges to invest $10 billion, at a $350 billion valuation for Anthropic, and an additional $30 billion if Anthropic meets certain performance targets, Anthropic said.

The promise of investment comes after Anthropic released its latest model, Mythos, to a limited group of partners this month. Anthropic says Mythos is the company’s most powerful model yet and has significant cybersecurity applications. Due to potential abuse, Anthropic has limited broader access while it works with select organizations to evaluate and address these risks – although the model has already fallen into disrepair unapproved hands. It is also likely to be expensive to run at scale.

The AI ​​race is increasingly determined by access to the computing power needed to train and deploy these systems. OpenAI has moved aggressively to secure that capacity through a web of deals worth hundreds of billions of dollars between cloud providers, chip suppliers and energy companies, including one expanded deal with chipmaker Cerebras this month.

Anthropic has had its own problems. The company is confronted widespread complaints over Claude’s usage limits in recent weeks and responded with a slew of infrastructure deals. Earlier this month, Anthropic made a deal with cloud computing provider CoreWeave for data center capacity. It also secured an additional $5 billion investment from Amazon this week, part of a broad deal that will see Anthropic spend up to $100 billion over time for about 5 gigawatts of computing capacity.

While Google is a direct competitor in AI models, it is also a key infrastructure provider for Anthropic. Anthropic relies heavily on Google Cloud for chips and infrastructure, including access to Google’s tensor processing units (or TPUs). These are specialized chips designed for AI workloads and are considered one of the best alternatives to Nvidia’s in-demand processors.

Anthropic’s relationship with Google predates this week’s news. Earlier this monthAnthropic has announced a partnership with Google and chipmaker Broadcom, which designs custom AI chips for Google, to gain access to multiple gigawatts of TPU-based computing capacity starting in 2027; a subsequent Broadcom stock filing put that figure at 3.5 gigawatts.

Google’s new investment expands that arrangement, with Google Cloud now delivering 5 gigawatts of new capacity over the next five years, with room to scale further.

Anthropic’s valuation was $350 billion in February; According to Bloomberg, investors have since been eager to back the company for $800 billion or more. The company is also reportedly considering an IPO as early as October.