Non-Cancellable Commitments: Reading Anthropic’s $518 Billion Compute Bill

About 80% of Anthropic’s reported $518 billion in compute commitments is either locked in or payable whether or not the capacity is used, according to reports of its draft prospectus. What take-or-pay contracts mean for the books, and what founders signing committed-spend deals can learn.

Most of the computing power Anthropic has ordered is computing power it has to pay for, used or not. Reuters reported in late September that the AI company’s draft IPO prospectus lists at least $518 billion in infrastructure spending over a decade with six partners, and that about 80% of it cannot be cancelled or must be paid whatever the usage. Those non-cancellable commitments are likely to be among the most closely read lines once the filing is public.

Where it stands: On October 20, The Wall Street Journal added its own account of the same draft: cloud contracts worth about $450 billion, running seven to 10 years and mostly non-cancellable, and total infrastructure commitments that could top $600 billion. Anthropic has not made the prospectus public.

Few startups will sign anything this size. Many will sign a committed-spend cloud deal, a reserved GPU block or a multi-year data-center lease, and the same accounting and disclosure logic applies to those.

What “non-cancellable” means in practice

A non-cancellable contract obliges the buyer to pay the committed amount even if it ends up needing less. The industry shorthand is take-or-pay. The mechanics vary, and the reported terms of Anthropic’s deals show three common versions.

The first is a shortfall clause. Reporting on the draft quotes Anthropic on its Google commitment: “If our actual spend falls short, we must pay Google the difference.” The commitment runs from April 2026 to July 2033, according to InvestmentNews.

The second is a contract that can be ended only for the supplier’s fault. Microsoft’s deal can be ended only if Microsoft itself breaches it materially and fails to fix the breach.

The third is a contract with a notice period, which is not really non-cancellable at all. PitchBook says most of the xAI agreement can be cancelled with 90 days’ notice, making it the exception among the large deals.

Anthropic’s commitments, partner by partner

PitchBook broke the $518 billion figure down by counterparty using the Reuters reporting. Cancellation terms appear only where a source has described them.

Counterparty Reported amount Exit terms reported
Broadcom-related equipment leases $161.2 billion Not described
Google $111.1 billion Shortfall must be paid
Amazon $110.0 billion Not described
xAI Up to $84.5 billion Mostly cancellable on 90 days’ notice
Microsoft $31.4 billion Only for Microsoft’s uncured breach
AMD More than $20.0 billion Not described

Two things stand out for a founder. Most of the money sits with a handful of suppliers, and the terms differ sharply from one deal to the next. A single “total commitments” number hides both.

Why the totals keep changing

Readers have seen at least six headline figures, and they are not interchangeable. Each has its own date and scope:

  • $54.6 billion: non-cancellable hosting and computing commitments at the end of 2025, per Reuters.
  • More than $417 billion: total long-term commitments by early 2026, covering 3.5 gigawatts of dedicated capacity, also per Reuters.
  • At least $518 billion: spending over a decade with six partners, the late-September Reuters figure.
  • About $450 billion: cloud agreements only, over seven to 10 years, per the Journal.
  • More than $600 billion: all infrastructure commitments in the October draft, per the Journal.
  • Up to $750 billion: the Journal’s total if deals worth up to $150 billion under negotiation are finalized. It is a total, not an amount on top of the $600 billion.

Even the first two are not a like-for-like pair: one counts only non-cancellable commitments at year-end, the other all long-term commitments a few weeks later. For a startup, the lesson is mundane: date-stamp every commitment figure you give investors, and say whether it covers signed contracts only.

Where commitments show up in the financial statements

Most of a take-or-pay obligation does not sit on the balance sheet the day it is signed. Leases are the main exception once they start. Netskope’s 2025 S-1 describes the standard treatment: lease assets and liabilities “are recognized on the lease commencement date based on the present value of lease payments over the expected lease term.” A lease signed for a data center that opens in two years is not on the balance sheet yet.

Purchase commitments for services are disclosed instead. Regulation S-K Item 303 tells companies that their liquidity discussion “should analyze material cash requirements from known contractual and other obligations,” and lists purchase obligations as an example. Netskope’s filing shows what that looks like at a smaller company: purchase obligations of $88.5 million due within 12 months and $336.1 million due after that.

That split by year is what Anthropic’s reported numbers lack so far. PitchBook put it plainly: “The available reporting does not provide a year-by-year payment schedule.” The public S-1 is where one would normally appear.

Contingency can run in both directions

Commitments bind suppliers too, and some of their language is conditional. Broadcom’s April 2026 8-K says Anthropic’s use of the expanded TPU capacity “is dependent on Anthropic’s continued commercial success.”

Supply is not guaranteed either. According to the Stocktwits summary of the Journal report, the draft says Amazon, Google and Microsoft have been unwilling to provide all the capacity Anthropic needs, which pushed it toward separate compute spending and third-party deals. A founder who signs a reserved-capacity contract should check what the supplier owes if it cannot deliver, not just what the buyer owes if it does not use.

Non-cancellable commitments at startup scale

The same questions apply to a six-figure annual cloud commitment as to a $111.1 billion one. Before signing, work through four of them:

  • What happens at a shortfall? Find the clause that bills unused commitment, and model a year in which usage drops by half.
  • Can you move the spend? Some commitments can be applied across services or regions; others are locked to one product. Our piece on whether a cloud commitment can limit your freedom to switch models covers the trade-off.
  • Is the term longer than your revenue visibility? A three-year commitment backed by month-to-month customers is a bet on retention.
  • Would renting be cheaper overall? Compare the committed rate with on-demand pricing for the usage you are confident of, as in our guide to renting GPUs by the hour or committing to reserved capacity.

Then put the schedule beside the cash. When 2025 closed, Anthropic held $20.28 billion of cash and short-term investments combined, Reuters reported from the prospectus. In the first half of 2026 it spent nearly $9 billion on computing capacity and infrastructure, up from $2.3 billion a year earlier.

Frequently Asked Questions

What does non-cancellable mean in a cloud contract?

It means the buyer owes the committed amount whether or not it uses the capacity. Some contracts bill the shortfall at the end of a period; others simply cannot be terminated early except for a serious breach by the supplier.

Do non-cancellable commitments go on the balance sheet?

Leases are generally recognized once they commence, as a right-of-use asset and a lease liability. Service and purchase commitments that have not been performed are usually disclosed instead, in the notes and in the liquidity discussion that Regulation S-K Item 303 requires.

What is the total of Anthropic’s compute commitments?

Reported figures differ by date and scope. Reuters cited a minimum of $518 billion across six partners over roughly ten years, about 80% of it non-cancellable. The Wall Street Journal reported about $450 billion of cloud agreements, total commitments that could exceed $600 billion, and up to $750 billion if deals under negotiation close.

Which Anthropic compute deal can be cancelled?

According to PitchBook, most of the xAI agreement, worth up to $84.5 billion, can be cancelled with 90 days of notice. The Microsoft deal, by contrast, binds Anthropic unless Microsoft breaks its terms in a serious way and leaves the problem unfixed, InvestmentNews reported.

Should a startup sign a committed-spend cloud contract?

It can make sense when usage is predictable and the discount is meaningful. The risk is paying for capacity you no longer need, so match the term to revenue you can see, and model the shortfall payment if usage falls.

Sources

This article is general information for founders and is not accounting, legal or investment advice. How a financing instrument is accounted for depends on its exact terms; work through it with your accountant or auditor. Anthropic has not published its IPO prospectus; figures are as reported by the sources cited on the dates shown.