Daily AI digest, October 29

Felix Laurent 29 Oct 2026 4 min read

News

The biggest AI news of October 29 was the bill for AI compute. Alphabet stock fell about 12% after its quarterly spending on data centers doubled and free cash flow turned negative. Microsoft grew Azure by 48% and beat Wall Street's earnings estimate. Mistral released the open weights of Large 4, and Cohere opened what it calls the largest round ever raised by a private Canadian company. Below are the big stories of Thursday, October 29, plus the smaller updates from the same day.

Alphabet falls after its capex doubles

Alphabet reported third-quarter results late on Wednesday, and investors reacted on Thursday. The quarter showed both sides of the AI race: AI brings in money fast, but it costs even more to build.

The income side looked strong. Revenue rose 25% to $127.6B. Google Cloud, which rents out the servers and chips that companies use to train and run AI models, more than doubled to $30.7B. Its operating income grew from $3.6B to $11.1B.

The cost side is capital expenditure, or capex: the money spent on data centers, servers and AI chips. Alphabet spent $51.4B on them in the quarter, up from $24.0B a year earlier. That is more than the cash its business brought in, so free cash flow came in at minus $9.1B.

The company kept its 2026 capex range at $195B to $205B and said spending in 2027 will "increase significantly," The Motley Fool reports. Investors read that as years of AI spending ahead, and Alphabet's class A shares fell about 12% on Thursday.

Microsoft reported the same evening and got a calmer reaction. Revenue rose 19% to $92.3B, Microsoft Cloud reached $63.9B, and Azure grew 48% to $33.2B. Cash capex was $39.4B, and adjusted earnings per share of $4.89 beat the roughly $4.72 analysts expected.

Mistral releases open weights of Large 4

Mistral published the weights of Mistral Large 4, a 1-trillion-parameter multimodal model, on Hugging Face. It comes under the Mistral Ecosystem Open-Weight license, a modified MIT license. Companies that sell the model as a service need a separate commercial license.

Mistral's own figures for the release:

41% on Terminal-Bench 4.0, 13 points above the preview from earlier this month
48% on the Artificial Analysis Coding Agent Index, level with GLM-5.3, with 47% fewer tokens per task
19.7% on Cognition FrontierCode 2.0
97.1% on the B3 Agent Security Benchmark

The API costs $0.70 per million input tokens and $2.10 per million output tokens. Mistral also put its Responses API in public preview: answers, reasoning and tool calls now come back as separate typed items. Our breakdown of the license and hardware needs is here, and the Responses API has its own article.

Cohere opens a CAD $7B round

Cohere announced the first close of its Series E, which targets up to CAD $7B. Schwarz Group leads the round, with Bell Ventures, Bullhound Capital, Inovia Capital, Nvidia, Prosperity7 Ventures and the Government of Canada taking part. Cohere calls it the largest round ever raised by a private Canadian company. The company did not state a valuation in its post.

Smaller updates

Five product updates landed on the same day.

OpenAI is cutting ChatGPT Pro 200 from 20x to 10x of Plus usage from October 30, at the same $200 price. We covered what changes here.
Anthropic says Claude's self-assessment flags 78% of the misuse that a heavier classifier catches and 94% of urgent cases, for under 2% of the compute. Details are in our article.
ElevenLabs released Sound Effects v3, which builds layered scenes with music and vocals from one prompt, up to 30 seconds long. More in our article.
Pika released H3 Flex, a post-trained MiniMax H3 that makes a 15-second clip in 7 seconds of compute. We wrote about it here.
Pika also lists the Kling 4.0 API at $0.157 per second at 720p. Our read of the price page is here.

Three of the five are video and audio tools, so creative AI had its busiest day of the week.

Security and law

Three stories showed where AI tools meet the courts and attackers.

Forever Security broke the browsers built into VS Code, Cursor, GitHub Copilot, OpenAI Codex and Claude Desktop. In its test, a disk sweep collected SSH keys, .env files and npm tokens. Cursor and Copilot shipped fixes in October; Codex and VS Code had no fix as of October 29, Help Net Security reports.
A California judge overruled Google's demurrer in former NPR host David Greene's lawsuit over the male voice in NotebookLM's Audio Overviews. All four of his claims, including the right of publicity, go forward, Radio Ink reports.
New York Governor Kathy Hochul signed a law that bars chatbots from pretending to be a real person and from encouraging self-harm in children. Companies must verify ages and face fines of up to $25,000 per violation. The law takes effect in six months, Engadget reports.

All three put the burden on the companies that ship the tools.

Funding

Two startups raised money for AI that works on top of existing data.

SuperMe raised $20M led by Forerunner, with Greylock taking part. It builds AI profiles of real experts and answers questions through a group chat of those profiles, TechCrunch reports.
Solink raised more than $100M led by Vertu Capital to pull business data from security cameras with AI. It already runs on about 500,000 cameras at more than 35,000 locations in 65 countries, SiliconANGLE reports.

Solink's round was the larger of the two.

What the day was about

Thursday was the day investors priced the cost of AI. Alphabet grew Google Cloud by 103% and still lost about 12% of its market value. The reason was $51.4B of quarterly capex, which pushed free cash flow to minus $9.1B. Microsoft spent $39.4B and was spared.

The rest of the market went the other way, toward cheaper access. Mistral put a 1-trillion-parameter model on Hugging Face at $0.70 per million input tokens, and Cohere raised money to stay independent. On October 29 the question was no longer who builds the biggest model, but who can afford to keep paying for it.