Tech Giants Bet Big on AI Rival Anthropic
In a massive move that reshapes the artificial intelligence landscape, technology behemoth Microsoft Corporation and chipmaker Nvidia Corporation have agreed to invest a staggering $15 billion in AI company Anthropic PBC. This strategic investment, reported by Bloomberg citing insider sources, positions Anthropic closer to competing with its rival OpenAI's primary financial supporters.
The substantial funding will form part of Anthropic's upcoming fundraising round, significantly boosting the company's war chest in the intensely competitive AI sector. The announcement comes at a time when Microsoft and ChatGPT creator OpenAI have become increasingly public about their competitive tensions.
Massive Computing Deal and Market Reaction
Separately, on November 18, the companies revealed that Anthropic, creator of the Claude chatbot, has committed to purchasing $30 billion worth of computing capacity from Microsoft's Azure cloud services. This monumental computing agreement underscores the massive infrastructure requirements of advanced AI systems.
Market reaction to these developments saw Microsoft shares decline by 3.5% while Nvidia dropped 2.8% amid broader market pressures. The timing of these deals has raised eyebrows among investors concerned about potential market overheating in the AI sector.
Circular Deal Concerns and Competitive Dynamics
Industry analysts have expressed worries about so-called "circular deals" where cloud computing companies back chip providers, who then invest in AI developers, who subsequently funnel money back into computing infrastructure. Some market observers fear this circular capital movement might indicate an emerging AI bubble.
Microsoft CEO Satya Nadella addressed the partnership dynamics in a recent video statement, emphasizing: "We are increasingly going to be customers of each other — we will use Anthropic models, they will use our infrastructure, and we will go to market together. Of course, this all builds on the partnership we have with OpenAI, which remains a critical partner for Microsoft."
Anthropic, founded in 2021 by former OpenAI employees, has established itself as a safety-focused AI company that enterprise clients can trust. The company's Claude chatbot and underlying technology have gained significant traction across financial services, healthcare, and developer communities.
The AI firm recently demonstrated its market strength by raising $13 billion at a $183 billion valuation in September 2025. Anthropic currently boasts an impressive 300,000 business customers and has ambitious plans to spend $50 billion constructing custom AI data centers across multiple US locations including Texas and New York.
In addition to the Microsoft partnership, Anthropic has secured a major computing agreement with Alphabet Inc.'s Google, which will supply up to 1 million specialized AI chips to dramatically increase the startup's computing capacity. This deal is valued at tens of billions of dollars.
As part of the expanded Microsoft collaboration, Anthropic's AI models will become available on Microsoft's Foundry service for cloud-based AI model deployment. This addresses a notable gap in Microsoft's cloud offerings, which previously featured models from OpenAI, Meta Platforms Inc., DeepSeek, and Elon Musk's xAI, but lacked Claude Sonnet models.
Amazon remains another key Anthropic partner with an $8 billion investment and has constructed extensive data center complexes using custom Amazon Web Services AI chips specifically for Anthropic's requirements. Despite these multiple partnerships, Amazon continues to serve as Anthropic's primary cloud provider.
The September 2025 announcement that Microsoft would begin using Anthropic models to enhance its workplace AI assistant further demonstrates the increasingly interconnected nature of AI industry partnerships and competition.
