Anthropic to Buy $30 Billion of Azure Compute Capacity in Microsoft and Nvidia Partnership

Nvidia and Microsoft agreed to invest up to $10 billion and $5 billion, respectively, in Anthropic. (Joel Saget/AFP via Getty Images)

Key Points

• Nvidia and Microsoft will invest up to $10 billion and $5 billion, respectively, in Anthropic.
• Anthropic commits to purchase $30 billion in compute capacity and 1 gigawatt from Microsoft Azure.
• Nvidia and Microsoft shares fall following the announcement.

Nvidia and Microsoft are betting on Anthropic.

On Tuesday, the leading maker of artificial-intelligence chips and the software giant have committed to invest up to $10 billion and $5 billion, respectively, in Anthropic as part of a new strategic partnership.

Under the terms of the agreement, Anthropic has committed to purchase $30 billion worth of compute capacity and contract up to one gigawatt of additional capacity from Microsoft as it scales its flagship AI assistant, Claude, on the hyperscaler’s Azure platform.

Anthropic and Nvidia also announced the two companies will collaborate together for the first time on designing and engineering the start-up’s models and Nvidia’s future product architectures to optimize performance for Anthropic’s AI workloads.

“The quality of these AI models now have really reached an inflection point,” Nvidia CEO Jensen Huang said in the announcement video. “The thing that is really great is they [Anthropic] are going to need a lot more Azure compute resources and they are going to need a lot more GPUs.”

Nvidia stock was down 2.7% to $181.59 following the announcement, while Microsoft fell 3.6% to $489.40. The Nasdaq Composite was down 1.7% on Tuesday.

In September, Anthropic said it raised $13 billion in new capital that valued the start-up at $183 billion. At the time, the company said its revenue had reached an annualized run rate surpassing $5 billion with more than 300,000 business customers, up from $1 billion annualized revenue run rate at the beginning of the year.

Microsoft CEO Satya Nadella also had a message to the technology industry, asking for more collaboration to bring AI’s productivity benefits to the more companies.

“As an industry we really need to move beyond any type of zero-sum narrative or winner-take-all hype,” he said. “What’s required now is the hard work of building broad durable capabilities together, so that this technology can deliver real tangible local success.”

Nadella has said in the past Microsoft will offer model choice to its customers including OpenAI, Anthropic, internal Microsoft models and others.

Write to Mackenzie Tatananni at mackenzie.tatananni@barrons.com