The short answer is no, the long answer is "probably not, but if so there are still ways around it."
IACRA will not accept name mismatches when creating an airman application for certificate or rating. If IACRA refuses to accept your AKTR when inputting it into the system, you'll have to revert to a paper 8710-1 application instead. The latter is undesirable for a host of reasons, but not a showstopper by any means.
I haven't seen problems with initials, but I have seen problems with names that are hyphenated.