Here's a fact that surprises many people: a large share of the technology companies that go public are losing money at the time of their IPO, sometimes billions a year. So it was notable when reports emerged in September 2026 that Anthropic, the AI lab behind the Claude chatbot, has told investors it expects to be profitable for a second straight quarter, ahead of a potential blockbuster listing.
Why do so many tech companies IPO while deep in the red, and why is a profitable AI company such an exception? And, importantly, what's the catch behind that "profitable" headline? This guide explains, in plain English. It's educational, not investment advice. If it helps you understand the market, you can explore US-listed stocks and ETFs from just $1 with zero commission on the Nemo.money app.
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Why So Many Tech Companies IPO While Losing Money
It sounds counterintuitive, why would you list a company that isn't profitable? But in tech, it's often the norm, and there are real reasons for it:
- 🌱 Growth is prioritised over profit. Many tech companies deliberately pour money into growing fast, expanding, hiring, marketing, building market share, rather than turning a profit early. The bet is that scale now leads to much bigger profits later.
- 🏗️ Some businesses are hugely expensive to build. Certain tech (and especially AI) requires enormous upfront investment, in data centres, computing power, research and talent, long before the revenue catches up. Spending runs ahead of profit by design.
- 💸 Listing to raise cash. For a lossmaking company burning through money, an IPO can be a way to raise large sums to keep funding that growth. Going public isn't just a victory lap; sometimes it's a fundraising necessity.
- 📖 A well-worn playbook. Plenty of now-huge tech names went public while lossmaking, and some stayed unprofitable for years afterwards. Investors have often accepted losses in exchange for rapid growth and a big future vision, even the record-breaking SpaceX listing showed how much a compelling story can drive a debut.
The key takeaway: in tech, "not profitable yet" is common at IPO. It reflects a growth-first culture, but it also means investors are frequently betting on a future that hasn't arrived yet.
Why Anthropic Being Profitable Is Notable
Against that backdrop, a profitable AI company preparing to go public genuinely stands out, because frontier AI is one of the most cash-hungry businesses around.
- 🔥 AI is famous for "cash burn". Training cutting-edge AI models costs staggering sums, so the leading AI labs are widely assumed to be losing enormous amounts of money as they race to build ever-more-powerful systems.
- 💚 Anthropic's reported profit bucks that. According to reports, Anthropic told investors its adjusted operating income would be positive for a second consecutive quarter, with very high gross margins (reportedly above 80% before certain costs). If accurate, that's an unusual signal of financial discipline for a frontier AI company.
- 🎯 Why it matters for a listing. Ahead of a possible IPO, showing profitability (even on an adjusted basis) is a way to reassure investors nervous about AI's huge spending. It suggests the business model can make money, not just burn it, a powerful message when you're seeking a very high valuation.
For a five-year-old AI company reportedly eyeing one of the largest listings ever, being able to point to profits, rather than just growth, is a meaningful differentiator.
The Catch: What "Profitable" Really Means Here
This is the crucial part, and a lesson that applies far beyond Anthropic: the word "profitable" can mean very different things, so you have to read the fine print.
- 🧾 It's "adjusted" profit, not the whole picture. The reported profitability is on an adjusted operating basis, a measure that, according to reports, strips out certain costs, including stock-based compensation and, crucially, the massive cost of training new models. Those are real costs. On a full, all-in basis, a company can still be spending far more than it earns.
- 🏦 Still raising huge sums. Frontier AI companies continue to raise enormous amounts of money to fund their expansion, which is not what you'd expect from a business that's comfortably, fully profitable. Adjusted profit and true, bottom-line profit are not the same thing.
- 🔍 The lesson: always check which "profit". Companies (and their headlines) often highlight the most flattering measure. "Adjusted", "operating", "EBITDA" and "net" profit can tell very different stories. A savvy investor always asks: profitable by which measure, and what's being excluded?
None of this means Anthropic's reported profitability isn't a genuine positive, it is a notable milestone. It means the honest reading is "profitable on an adjusted basis, which is a real and unusual achievement for a frontier AI company, but not the same as being fully, cash-generatively profitable".
What It Means for Investors
Beyond this one company, there are genuinely useful lessons here:
- 📊 Profitability at IPO is a real differentiator. All else equal, a company that's already making money (properly) is often a lower-risk proposition than one promising profits "eventually". Research has shown that profitable companies have tended to perform better after listing than unprofitable ones, one of the key lessons in our guide to how IPOs really perform.
- ⚠️ But read the definition. A profit built on adjusted figures that exclude major real costs deserves scrutiny. The headline can flatter the reality.
- 🚫 You still can't buy the private ones. Anthropic, like several leading AI companies, is currently private, so there's no stock to buy today. Even a hotly anticipated listing hasn't happened yet, and timing isn't guaranteed, rival OpenAI just delayed its own IPO. Investors researching the theme look at the listed players connected to AI instead.
- 🧠 Don't let a headline replace homework. Whether it's "profitable" or "lossmaking", a single label is never the full story. The real work is understanding how a company actually makes (or loses) money, and whether its valuation makes sense.
The Honest Risks
- ⚠️ "Adjusted" can mask reality. Profit measures that exclude big real costs (like training AI models) can make a cash-burning business look healthier than it is.
- ⚠️ Reported, not confirmed. Anthropic's profitability figures come via news reports citing sources, not detailed public accounts. Treat them as informative, not gospel.
- ⚠️ Lossmaking IPOs are risky. Historically, unprofitable companies bought at IPO (especially after a first-day pop) have tended to underperform, a reason for caution with the many tech listings that arrive in the red.
- ⚠️ You can't buy the private AI leaders. The temptation to buy "AI" via proxies is real, but those are different companies with their own risks and valuations.
- ⚠️ Valuation still rules. Even a profitable company can be a poor investment if bought at too high a price, and some AI valuations are extraordinary.
The takeaway: whether a company is lossmaking or "profitable" at IPO tells you something important, but only if you understand what the label really means. Read past the headline, check which profit you're being shown, and judge the business and the price on the full picture.
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Frequently Asked Questions (FAQs)
Do most tech companies make money when they IPO?
Often, no. A large share of technology companies go public while still losing money, sometimes substantial amounts. Many deliberately prioritise rapid growth, expanding, hiring and building market share, over near-term profit, and some (especially AI companies) require enormous upfront investment before revenue catches up. Investors have frequently accepted losses in exchange for growth and a big future vision, though this makes such IPOs riskier. This is general information, not advice.
Is Anthropic profitable?
According to news reports in September 2026, Anthropic told investors its adjusted operating income would be positive for a second straight quarter, with very high gross margins, unusual for a frontier AI company. However, this is an "adjusted" measure that reportedly excludes certain costs, including stock-based compensation and the huge cost of training AI models. So it's a genuine and notable milestone, but not necessarily the same as being fully, all-in profitable. The figures come from reports citing sources, not detailed public accounts.
What does "adjusted operating profit" mean?
"Adjusted operating profit" is a company-defined profit measure that starts from operating profit and strips out certain costs the company considers one-off or non-core, which can include things like stock-based compensation and, in some cases, major investment costs. It can be useful, but because companies choose what to exclude, it can also make results look better than a full, standard (GAAP) profit figure. Always check which profit measure is being used, and what's left out.
Why do investors care if a company is profitable at IPO?
Because profitability, real profitability, is a signal of a sustainable business, and a company already making money is often lower-risk than one promising profits "eventually". Research has found that profitable companies have tended to perform better after listing than unprofitable ones. That said, the profit has to be genuine (not just a flattering adjusted figure), and even a profitable company can be a poor investment if its shares are too expensive.
Can I invest in Anthropic?
Not directly. Anthropic is a private company, so its shares aren't available on the public market, even though it has been linked to a possible major listing. This is common among leading AI companies. Investors interested in the theme typically research the listed companies connected to AI (such as chipmakers, cloud providers and big tech) instead.
Final Thoughts: Read the Label, Then Read the Fine Print
The contrast is striking: while a large share of tech companies list while losing money, betting on growth over profit, a leading AI lab is reportedly heading toward the market able to say it's profitable. In a sector famous for eye-watering cash burn, that's a genuinely notable claim, and a smart message to send investors nervous about AI's costs.
But the deeper lesson is about reading carefully. "Profitable" is doing a lot of work in that headline, and the fine print, that it's an adjusted measure excluding major real costs, matters enormously. It's a perfect example of why investors should never take a single financial label at face value. Whether a company is lossmaking or profitable at IPO, the real question is always the same: how does this business actually make money, by which measure, and is the price worth paying? Read the label, then read the fine print, and judge the whole picture, not the headline.
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