[darkwater]

Maybe for people used to deal with financial announcements, but from my ignorant and naive point of view, if I read that claim I think instinctively that they made $19b during the last 12 months, not that they are going to maybe make it if they keep the same rate as the last month for the next 12 months.

[yen223]

"Annualized revenue" is a projection, and is known to be a projection.

[csomar]

The problem is, annualized revenue doesn’t work when your income has a 3 standard of deviation month to month. It is standard for other fields/businesses but these tend to have stable month to month revenue.

[dcre]

It’s not deviating up and down. It’s deviating upward. It is necessarily going to wildly overstate the previous 12 months’ revenue while wildly understating the next 12 months’ revenue. There is no way to describe exponential growth in a single number that doesn’t do this. This is why adults with a brain look at the series.

[nraynaud]

I would venture that's it's the whole reason they use it. because it doesn't work.

[jeeeb]

If anything, it’s a very conservative estimate. Short of a major turn of events it seems very unlikely Anthropic’s revenue growth is going to slow to zero.

[throwaway713]

Interesting. I’m going to start describing my “annualized impact” in my performance self-reviews in terms of all the things I project that I’ll do.

[fluidcruft]

Go for it. Be aware of what happens to your stock when expectations you set do not materialize.

[sjsdaiuasgdia]

Dunno about that, somehow Tesla stock doing pretty well despite setting a lot of expectations that haven't materialized.

[rvnx]

Investors don't want results anyway, they want a dream. Until the IPO which is the final boss stage where you are selling forward looking profits

[qarl]

Yes but my mother-in-law doesn't understand it, so it's a lie.

[matwood]

It's certainly not a perfect number, but what else are you going to do for a fast growing business? If it does 1B month 1, 5B month 2 and 10B month 3, how does an investor extrapolate the next 12 months? Obviously it's a forecast and will be imperfect without more data. Any potential large investor will be given more financials to help them determine if the 10B was a 1 time event or if it is actually recurring. The harder part is understanding the growth rate.

The be fair to Zitron he claims that enterprise customers are likely paying up front so it won't continue in future months. But now we're into accrual for the future revenues which further complicates the analysis.

[mbreese]

Even if an enterprise customer was prepaying, that would only show up on a cash balance statement, not as revenue for the month it was collected in. Yes, this is based on accrual in accounting terms. But because the revenue isn’t recognized immediately, collecting prepayment in February shouldn’t skew ARR reported in March.

[matwood]

Per GAAP you are correct, but many of these ARRs are qualified as non-GAAP. So yes, a real analysis should do what you're saying but are they is the question. Also, if they are buying tokens with no time limit, that will complicate the accrual forecast. This could be why all of the downstream investor companies like Amazon are pushing their employees to tokenmax.

[fluidcruft]

Wall Street be like that (and worse). Caveat emptor.