Chinese AI model emerges as fresh threat to Anthropic ahead of planned float

Jefferies' Christopher Wood flags a "DeepSeek moment" arsenic cheaper Chinese models summation crushed connected Western incumbents

The motorboat of a low-cost Chinese artificial quality exemplary has been described by Jefferies strategist Christopher Wood arsenic different "DeepSeek moment" for the exertion sector.

Wood, writer of the bank's wide work Greed & fearfulness note, said the GLM-5.2 exemplary from Hong Kong-listed Z.ai, formerly Zhipu AI, was astir a lucifer for Anthropic successful the firm marketplace astatine a 4th of the outgo per token.

The situation lands arsenic Anthropic, the US AI developer down the Claude chatbot, prepares for a planned banal marketplace listing.

Anthropic's annualised run-rate gross has surged from $9 cardinal astatine the extremity of 2025 to $47 cardinal successful May, maturation Wood expects to dilatory arsenic companies propulsion backmost against dense token consumption.

He argued the menace was greater inactive for rival OpenAI (Unlisted:OPAI), which has already mislaid crushed to Anthropic among firm customers and is besides weighing a listing.

Cheaper Chinese models are already gaining share, with the apical Chinese systems processing 21.37 trillion tokens connected the OpenRouter aggregator level successful the week to 21 June, up from 4.37 trillion successful precocious April, against 5.76 trillion for the starring US models.

Wood sees the displacement reinforcing a presumption that ample connection models volition go commoditised, portion giving companies an inducement to determination smaller models onto their ain servers to support data.

Despite the competitory unit connected the exemplary developers, Wood remains affirmative connected the "picks and shovels" suppliers that person driven AI-related banal gains, citing the Jevons paradox, nether which cheaper tokens spur greater wide request for computing powerfulness and representation chips.

He named representation makers arsenic the main beneficiaries, arguing SK Hynix, Samsung Electronics Co Ltd (ADR) (LSE:BC94) and Micron Technology Inc (NASDAQ:MU) should present beryllium valued connected net alternatively than publication value, and inactive looked inexpensive connected that measure.

Wood said helium was raising vulnerability to exertion hardware crossed the Greed & fearfulness portfolios, adding Hynix and Kioxia to the planetary long-only portfolio portion removing Alphabet Inc (NASDAQ:GOOG) and Alibaba.

The main hazard to the wider trade, helium said, was a abrupt realisation among investors that hyperscalers and the starring AI developers cannot gain an capable instrumentality connected their spending, a fearfulness compounded by circular financing arrangements specified arsenic Nvidia backing OpenAI's spot purchases.

For now, Wood said, specified concerns remained theoretical, with nary motion yet of the AI superior spending contention slowing.

Other stocks that are of interest:

Microsoft Corp (NASDAQ:MSFT)

Oracle Corp (NYSE:ORCL, XETRA:ORC)

Amazon.com Inc (NASDAQ:AMZN)

Meta Platforms Inc (NASDAQ:META, XETRA:FB2A, SIX:FB)

Salesforce Inc (NYSE:CRM, XETRA:FOO)

Workday Inc (NASDAQ:WDAY)