Major tech companies are rethinking their AI spending plans as investors question the returns on massive capital investments. Alphabet reported $51.3 billion in capital projects tied to AI during Q3 2026, which pushed free cash flow negative and caused data center stocks to drop. IREN fell 6% and Cipher Digital dropped 5% following the earnings report. Meanwhile, Microsoft lowered its capital spending forecast to $170 billion, citing delays in third-party AI capacity. Microsoft CFO Amy Hood addressed concerns on Wall Street about whether hyperscalers can sustain this level of funding.
Google's earnings call added to investor unease. The stock dropped nearly 11% before trading resumed, as worries grew that AI tools like Gemini and AI Overviews could reduce valuable search advertising revenue. While search revenue continues to increase, Alphabet does not share enough data about Gemini to fully address investor concerns. New advertising formats and Gemini subscriptions may help offset potential losses.
Microsoft also reported a $10.0 billion net gain from OpenAI for the quarter ending 30 September 2026, equal to about 10.8% of its total quarterly sales. Accounts receivable from OpenAI rose to $7.2 billion, up from $6.0 billion at mid-year. Microsoft's stake in OpenAI sits at approximately 24%, down from 27% after OpenAI's recapitalisation in October 2025. The company also has $13 billion in funding commitments, with roughly $1.0 billion still unfunded.
On the regulatory front, CFTC Commissioner Selig proposed new rules for AI trading agents and compute futures, asking who should be liable when autonomous AI systems act unexpectedly. Several states are moving on AI governance, including New York, where Senator Andrew Gounardes introduced S.10731 to establish transparency and safety requirements, along with a dedicated AI safety and transparency board. Public opinion strongly favors human involvement: a survey found 82% of Americans support laws requiring human review of AI-made medical claim denials, while only 5% accepted AI handling insurance claims alone.
In more practical developments, Cubrik AI launched tools that make AI-powered automated trading more accessible to non-programmers, covering market analysis, strategy development, and trade execution. Baseten released joey-1, a 2 billion parameter decision model available on Hugging Face under an MIT license at $0.01 per million input tokens. The model ranked first under 4B parameters on the Jev Decision Index 0.4 public split with a score of 63.30.
Key Takeaways
- Alphabet spent $51.3 billion on AI-related capital projects in Q3 2026, pushing free cash flow negative and shaking data center stocks.
- Microsoft cut its AI spending forecast to $170 billion due to delays in third-party AI capacity, while Azure revenue continues to grow.
- Google stock dropped nearly 11% over concerns that Gemini and AI Overviews may erode search advertising revenue.
- Microsoft reported $10.0 billion in net gains from OpenAI, equal to about 10.8% of its total quarterly sales.
- Microsoft's OpenAI stake declined to approximately 24% from 27% after OpenAI's recapitalisation in October 2025.
- CFTC Commissioner Selig proposed rules addressing liability and oversight for autonomous AI trading agents.
- Senator Gounardes introduced S.10731 in New York, proposing AI safety and transparency rules with a dedicated oversight board.
- 82% of Americans support laws requiring human review of AI-made medical claim denials, according to an eHealth survey.
- Pew Research found only 5% of U.S. adults accept AI handling insurance claims alone, and 3% accept AI making diagnoses alone.
- Baseten launched joey-1, a 2B parameter decision model priced at $0.01 per million tokens, ranking top under 4B on the Jev Decision Index.
Cubrik AI launches easier AI-powered trading tools
Cubrik AI introduced a new approach to AI-powered automated trading. The company aims to make trading agents easier to use for people without programming skills. Its tools help with market analysis, strategy development and trade execution. The effort reflects a broader trend toward accessible AI tools in finance.
CFTC's Selig proposes rules for AI trading agents
CFTC Commissioner Selig called for new rules covering AI trading agents and compute futures. He said AI systems that trade independently raise questions about responsibility and oversight. He also asked who should be liable if an AI agent acts in unexpected ways. The CFTC wants to understand these markets before creating new requirements.
Most Americans support human review of AI claim denials
A survey found 82% of Americans back a law requiring human review of medical claim denials made by AI. The eHealth survey polled more than 1,000 U.S. adults in October. Several states have already passed laws on AI in insurance decisions. The findings show strong public support for keeping a person involved in denials.
Most Americans oppose AI making medical or insurance decisions
A Pew Research Center survey found most U.S. adults do not want AI to decide medical or insurance matters. Only 5% accepted AI handling insurance claims alone, and 3% accepted AI making diagnoses alone. Many respondents worried about privacy and the patient-doctor relationship. Trust in doctors was higher than trust in AI companies or the government.
IREN falls as Alphabet's AI spending worries data center stocks
IREN dropped 6% after Alphabet reported heavy AI spending that pushed free cash flow negative. Cipher Digital also fell 5% ahead of earnings. Alphabet spent $51.3 billion in Q3 2026 on capital projects tied to AI. Investors now question whether hyperscalers can keep funding the data center boom.
Microsoft cuts AI spending to $170B as Azure revenue grows
Microsoft is lowering its capital spending forecast to $170 billion due to delays in third-party AI capacity. CFO Amy Hood discussed the issue as Wall Street questions the returns on AI investments. The company continues to see strong growth in its Azure cloud business.
Google earnings raise questions about AI and search profits
Google's stock dropped nearly 11% before trading after earnings. Concerns grew that AI tools like Gemini and AI Overviews may reduce valuable search advertising opportunities. Search revenue is still increasing, but Alphabet does not share enough data about Gemini to fully answer investor worries. New advertising formats and Gemini subscriptions may help make up the difference.
Three questions leaders should ask about AI control
This article highlights three key questions that company leaders should consider to evaluate whether their organization has proper control over AI systems. The piece focuses on helping leadership understand AI governance and risk. It stresses the importance of asking the right questions to ensure responsible AI use.
Senator Gounardes proposes new AI safety and transparency rules
Senator Andrew Gounardes introduced legislation called S.10731 to regulate AI development and deployment in New York. The proposed rules focus on transparency, accountability, and safety for AI systems. The bill also calls for creating an AI safety and transparency board to oversee compliance. Gounardes said the goal is to ensure AI serves the public good.
Baseten releases joey-1, a 2B decision model at low price
Baseten launched joey-1, a 2 billion parameter decision model from its Base Labs research team. The model returns labels and probabilities instead of text, targeting tasks like classification and routing. Baseten prices it at $0.01 per million input tokens and released the model weights on Hugging Face under an MIT license. On the Jev Decision Index 0.4 public split, joey-1 scored 63.30, ranking as the top model under 4B parameters.
Microsoft reports $10B OpenAI gain in quarterly filing
Microsoft filed a quarterly report on 28 October 2026 showing $10.0 billion in net gains from OpenAI for the quarter ending 30 September 2026. That amount equals about 10.8% of Microsoft's total quarterly sales. Accounts receivable from OpenAI rose to $7.2 billion on 30 September 2026, up $1.2 billion from $6.0 billion on 30 June 2026. Microsoft's stake in OpenAI was approximately 24% in September 2026, down from about 27% after OpenAI's recapitalisation in October 2025. Microsoft also had funding commitments totaling $13 billion, with about $1.0 billion still unfunded as of 30 September 2026.
Sources
- Cubrik AI Introduces a More Accessible Approach to AI-Powered Automated Trading
- CFTC’s Selig Sees Role for Compute Futures, Rules for AI Trading Agents
- 82% of Americans back a law requiring human review of AI claim denials, survey finds
- Most Americans don't want AI deciding their medical care or insurance, survey says
- IREN Drops 6% as Alphabet's AI Cash Burn Rattles Data Center Stocks; Cipher Digital Falls 5% Ahead of Earnings
- Microsoft trims AI spending plans to $170B as Azure revenue surges
- Google stock analysis after earnings: Is AI eating into search profits?
- Three questions leaders should ask about AI control
- Sen. Gounardes Proposes Major New AI Safety and Transparency Regulations
- Baseten Releases joey-1, a 2B Decision Model at $0.01 per 1M Tokens
- Microsoft Booked $10B From OpenAI, 11% of Quarterly Sales
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