Friday Finance: TAM
As an IB Business teacher, it was important to know and understand the nomenclature around the concept of “Market Share.” That said, there are some important distinctions about a particular company’s share of the market. Marketers need to analyze the individual product(s) they may have in their line-up. Once defined, the product marketers need to investigate the local market (or the Serviceable Obtainable Market), the regional market and the national market (or Serviceable Available Market) and the global market (or the Total Addressable Market) that may be available to that company. Nothing has put these concepts more into focus than the upcoming initial public offerings (IPOs) of the AI wizards first at Anthropic with its Claude products (Nov, 2026) and Open AI with its ChatGPT products (spring, 2027).
Let’s look at the individual concepts of SOM, SAM, and TAM for some deeper investigation of these acronyms.
SOM (Serviceable Obtainable Market), the smallest circle in the venn diagram
- SOM (Serviceable Obtainable Market): The realistic portion of the SAM that a business can capture in the near term given its current resources and competition (sometimes also referred to as Share of Market)
SAM (Serviceable Available Market), the middle circle in the venn diagram
- SAM (Serviceable Available Market): The specific subset or segment of the TAM that fits your company’s product, geography, and target audience.
TAM (Total Addressable Market), the outermost circle in the venn diagram
- TAM (Total Addressable Market): The total market demand and potential annual revenue opportunity for a product or service if you achieved a 100% market share with no competition.
Anthropic, and presumably Open AI, as well as other players, are giving new meaning to the idea of a TAM (total addressable market) — a business term marketers use for “potential revenue opportunities.”
Estimated Market Opportunity, in $ trillions, in select tech IPO filings
Anthropic* (2026) $40.0
SpaceX (2026) $28.5
Rivian (2021) $9.0
Uber† (2019) $5.7
Airbnb (2020) $3.4
Reddit (2024) $1.4
Palantir (2020) $0.12
Snowflake‡ (2020) $0.08
In a filing ahead of its planned initial public offering, Anthropic, the artificial intelligence company, didn’t explicitly list a “total addressable market” figure. Instead, executives suggested it is staring down a $40 trillion-a-year opportunity, if it captures the entirety of demand. That would top SpaceX’s enormous $28.5 trillion estimate from earlier this year.
The range in estimates from cloud-storage and data company Snowflake to Anthropic shows how companies turn everything from software spending to human labor into a measure of their potential market. Snowflake’s calculation is fairly straightforward: How many potential customers are there, and how much could each spend?
Airbnb and Uber move one step outward, measuring the spending associated with the underlying activity rather than a company’s own products. In its 2020 filing, for example, Airbnb organized its $3.4 trillion addressable market into three distinct segments: short-term stays, long-term stays and experiences.
Airbnb’s estimated market opportunity in its IPO filing, by segment
- Short-term stays $1.8 trillion
- Experiences $1.4 trillion
- Long-term stays $0.2 trillion
Source: the company
SpaceX SPCX took the calculation a step further, pinning most of its opportunity to projections of the developing AI market.
Elon Musk’s rocket maker outlined three segments and estimated its AI business to have the largest potential of the group, with a bigger opportunity than its connectivity and space endeavors. SpaceX called its total addressable market “the largest actionable” market in “human history.”
SpaceX’s estimated market opportunity in its IPO filing, by segment
Enterprise applications AI infrastructure Consumer subscriptions Digital advertising Starlink broadband Starlink mobile
- Artificial intelligence $26.5 trillion
- Connectivity $1.6 trillion
- Space $0.4 trillion
Anthropic, in its S-1 filing the first week in November, 2026, took the concept to its broadest point yet: What if the market isn’t an existing product category at all, but the economic value of work that AI could perform? The company said it believes the work that knowledge workers perform represented more than $40 trillion in economic value last year. “With frontier AI’s potential to make them meaningfully more productive, our near-term opportunity is to expand this value and accelerate economic growth,” executives in the filing said.
Anthropic’s estimated market opportunity in its IPO filing, compared with that of seven other tech companies
Anthropic: $40.0 trillion! The value of Anthropic would be slightly less than these others combined: $48.2 trillion = SpaceX + Rivian + Uber + Airbnb + Reddit + Palantir + Snowflake!!!
Note: In its IPO filing, Anthropic didn’t explicitly list a “total addressable market” figure, but effectively suggested it was $40 trillion by estimating the economic value globally in 2025 of work performed by “knowledge workers.” Other companies in this chart used the term “total addressable market,” TAM, when referring to their market opportunity for their primary product.
Source: the companies
Anthropic cited IDC estimates that investment in AI solutions and services will lead to a cumulative global economic impact of $22.5 trillion by 2031.“We believe the impact could be even greater.” That makes the company’s total addressable market both potentially enormous and harder to independently verify.
A company’s addressable market isn’t a sales forecast, nor does it mean the firm expects to capture anything close to 100% of it. Anthropic’s current revenue, for example, is measured in $ billions (with a B), not trillions, which have 12 zeros.
The giant denominator tells investors that even extraordinary growth today could represent only a small share of a much larger opportunity down the road.
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