Big Tech Companies

[phkrause]

Anthropic seeks valuation of about $1.3 trillion when it becomes a publicly traded company

Artificial intelligence giant Anthropic is looking for an approximately $1.3 trillion valuation when it goes public despite new concerns about the massive amounts debt and money flowing into the sector. Read More.   Nvidia and Jensen Huang face shareholder lawsuit alleging investors were misled about spy affair A shareholder has sued Nvidia and its CEO, Jensen Huang, accusing them of deceiving investors in their responses to media reports about Huang's affair with a purported Chinese spy that threatens national security. Read More.

[phkrause]

🔎 Nvidia's peril deepens

Data: FactSet. Chart: Matt Phillips/Axios Nvidia doesn't have a clear succession plan for CEO Jensen Huang, as growing spy-scandal revelations threaten his hold on the chips giant he founded, built and personified. Why it matters: The peril for Huang (pronounced wong) shows the vulnerabilities of an iconic company being so dependent on one executive — with huge risks to investors, customers and, in this case, the AI economy, Axios' Nathan Bomey and Emily Peck report. The mushrooming scale of the crisis: Nvidia controls the most valuable commodity in the world, and one man controls Nvidia. China is hungry to buy or copy Nvidia's chips, which could determine which superpower wins the AI race. After denying it, Jensen Huang admitted Sunday to an affair with Alice Huang, an executive of a Singapore-based data center company who is believed by U.S. intelligence to be a spy for the Chinese government. Jensen Huang was in frequent, chummy communication with President Trump during the affair. Trump ignored warnings from the top of his administration and allowed chip sales that benefited the Chinese spy's company. The Commerce Department was digging hard on Nvidia and the spy's company, until it abruptly wasn't amid Nvidia's interventions — reporting by The New York Times that opened a new front in the crisis yesterday. (Gift link) 🔭 The big picture: The storm over Nvidia "may exacerbate fears among investors over the durability of the AI boom, after a revolt against data centers by voters in America's midterm elections," The Economist notes. Go deeper: "Nvidia's crisis and the politics of an AI pause," by Axios chief tech correspondent Ina Fried.

[phkrause]

💰 Anthropic is seeking to raise up to $62.5 billion in its IPO at a market cap that could top $1 trillion. That would make it one of the largest IPOs ever, but smaller than some had expected.

[phkrause]

Jensen's blast radius

Photo illustration: Sarah Grillo/Axios. Photo: David Paul Morris/Bloomberg via Getty Images

Jensen Huang's potential ouster from Nvidia leaves a blast radius far beyond the chip giant that's the backbone of the global AI economy: The scandal will consume the new Congress, could take out Commerce Secretary Howard Lutnick, goes all the way up to President Trump, and undermines U.S.-China relations on the eve of Trump's trip to Shenzhen for a summit next week and Xi Jinping's visit to Florida for a summit next month. Why it matters: Nvidia's chips, investments and financial guarantees sustain an ecosystem of companies worth trillions of dollars, Axios' Zachary Basu writes. At the epicenter of the blast is Huang, who spent 33 years making himself synonymous with Nvidia — and Nvidia synonymous with the AI revolution. "This is no ordinary CEO. This is no ordinary company. This is no ordinary sector. This is no ordinary time," economist Mohamed El-Erian wrote on X, warning of contagion across the AI industry. 🔎 Zoom in: As recently as two weeks ago, the notion of Nvidia without Jensen was unthinkable. Even after his affair with a suspected Chinese spy came to light, Trump and Nvidia's board stood behind him, Silicon Valley's elite rallied to his defense and betting markets suggested he would survive. A New York Times revelation yesterday that Huang had a second affair as recently as March — this time with an Nvidia executive who reports to him — shattered that consensus of support and put his storied reign in jeopardy. Driving the news: After that second affair came to light last night, Nvidia's board reportedly met to settle Huang's fate, though there was still no decision as of early this morning. The White House was read in. The market reaction has been brutal. Nvidia had already shed more than $1 trillion in market value since the initial scandal erupted, and shares plunged further in after-hours and pre-market trading. One of Wall Street's most prominent voices on tech, analyst Dan Ives, said Nvidia was worth 25% less without Huang. Data: FactSet. Chart: Matt Phillips/Axios Zoom out: Huang's rise was the stuff of Silicon Valley legend: The Taiwanese immigrant went from cleaning toilets at a Kentucky boarding school and waiting tables at Denny's to building one of the most valuable companies in history. Huang and two fellow engineers hatched the idea for Nvidia at a Denny's booth in 1993, launching a chipmaker that would revolutionize gaming, transform modern computing and ultimately power the AI revolution. Clad in his trademark black leather jacket, Huang became a global AI rock star — with a cult of personality that drew adoring crowds, calmed markets and commanded the attention of world leaders. 🖼️ The big picture: Huang's crisis comes amid mounting anxiety over the AI industry's future, as new financial, political and regulatory risks threaten one of the largest infrastructure buildouts in history. The timing is especially fraught for Anthropic, whose historic IPO — backed by a $10 billion commitment from Nvidia — looms as a referendum on Wall Street's faith in the AI trade. Huang spent years defending the industry's soaring valuations and dismissing warnings of a speculative frenzy. Now his own scandals could help burst the bubble he insisted didn't exist. 👀 What to watch: The blast radius could extend far beyond Silicon Valley and Wall Street, threatening to engulf the Trump administration in a scandal over its handling of sensitive technology exports to China. Huang forged a close alliance with Trump and Commerce Secretary Howard Lutnick, who loosened restrictions on chip sales even as other officials raised concerns about Chinese espionage and smuggling. Two top Senate Democrats, Sens. Elizabeth Warren of Massachusetts and Chris Coons of Delaware, demanded yesterday that Lutnick and other top Trump officials preserve records of their dealings with Nvidia and Huang.