Daily AI news, Wednesday, 21 October 2026

Good afternoon, here's today's AI, tech and VC briefing. SpaceX smashed expectations on the back of renting out AI compute and confirmed that Tesla merger talks have formally begun. A leaked draft of Anthropic's IPO filing shows how big its growth and its bills have become. OpenAI is now selling its models through Google Cloud, Salesforce is buying Braze, and a busy day of funding rounds created several new unicorns.

LEAD: SpaceX beats forecasts on AI compute, gives Cursor's first numbers and confirms Tesla merger committees

Background: SpaceX, which owns Cursor and the Grok business, went public in June. By last Friday its shares were almost 28% below their June high, as investors worried about its huge AI spending. Monday's briefing previewed analyst forecasts of about $12.9 billion in revenue. What happened: Third-quarter revenue rose 161% to $14.6 billion, beating the LSEG analyst estimate of $12.72 billion. Net income was $4.4 billion, against a $1.1 billion loss a year earlier. The AI division, now called Super Intelligence, brought in $7.6 billion, more than half the total. Reuters says most of that came from renting computing capacity to Anthropic, Google and Reflection AI, not from SpaceX's own models. TechCrunch notes that about $1 billion of income was linked to the recovery in Bitcoin prices and unspecified related-party gains. Cursor contributed $608 million of revenue between the deal closing on 14 August and 30 September. Of the $60 billion equity value SpaceX paid for Cursor, $23 billion was set aside to keep key staff and replace their equity awards, which cost $1.2 billion in stock compensation this quarter. Capital spending was $19.6 billion, $16.4 billion of it on AI, and SpaceX expects $35 billion to $40 billion in the fourth quarter as it grows from 1.7 gigawatts of computing capacity to between 2.5 and 3 gigawatts by year-end. It guided to $33 billion to $37 billion of revenue in the first quarter of 2027. Grok Bot had 800,000 paid weekly users earlier this month, more than double a month earlier. On the call, Musk claimed SpaceX's annualised revenue could reach $500 billion to $1 trillion by the end of 2027. He also said the boards of SpaceX and Tesla have each formed special committees of independent directors to study a merger. Because he's a "conflicted party", he can't take part, and he said assuming a deal is certain "would be overstating it". Tesla would need a majority of all its shares, not just of the votes cast. SpaceX shares were up about 9% in early trading on Wednesday. Why it matters: SpaceX is turning into a cloud provider: its fastest-growing business is renting chips to its AI rivals, including Anthropic. For coding tools, Cursor is now big enough to show up as a line in a giant's results, and SpaceX says folding Cursor in is strengthening its enterprise sales reach. A Tesla merger would put Musk's chip, robotics and AI plans in one company, but the Tesla shareholder vote is a high bar. Sources: SpaceX Q3 results (SEC) · Reuters via NBC News · TechCrunch · Earnings call transcript (Motley Fool) · TechCrunch on the merger committees · Reuters via Investing.com

2. Anthropic's draft IPO filing leaks: $16.3 billion of first-half revenue, an $80.7 billion paper loss, and $450 billion of locked-in cloud deals

Background: Tuesday's briefing covered OpenAI's rush to raise money before Anthropic lists in mid-November. Last week, some investors talked about valuing Anthropic nearer $1.5 trillion than $2 trillion after its growth slowed in the third quarter. What happened: The Wall Street Journal has seen a draft of Anthropic's S-1, the prospectus companies file before an IPO. Revenue in the first half of 2026 was $16.3 billion, up from $1.1 billion a year earlier. The net loss was $80.7 billion, but about $72 billion of that is a non-cash accounting charge tied to the rising value of convertible notes. Anthropic spent almost $9 billion on computing in six months, more than its $7.3 billion for all of 2025. It has signed about $450 billion of mostly non-cancellable cloud deals, including $111 billion with Google Cloud, $110 billion with AWS and $31 billion with Microsoft. It also plans up to $86 billion of Nvidia chip rental through Nscale and Lambda. About a fifth of first-half revenue came from just two customers. The risk factors also warn that a catastrophic AI incident could cost more than its insurance covers. Yahoo Finance reports, citing three people, that Anthropic could file the S-1 publicly as soon as Friday. IFR says the roadshow is planned for 9 November, targeting up to $100 billion raised at a $2 trillion valuation. Why it matters: This is the first detailed look at the economics of a frontier lab. Revenue is growing fast, but the lab has committed hundreds of billions of dollars to computing that it has to pay for whether or not demand keeps up. How investors react will set the tone for OpenAI's planned listing and for neocloud IPOs like Nscale's. Sources: WSJ · Fortune · BusinessLine (ANI) summary · Yahoo Finance · IFR

3. OpenAI's models and Codex come to Google Cloud, and ChatGPT ads expand to 89 countries

Background: Microsoft lost its exclusive licence to OpenAI's technology this spring, and Amazon began hosting OpenAI models the next day. Google sells its own Gemini models and its own coding tool, Antigravity. What happened: OpenAI said on Wednesday that its frontier models and Codex will be available in Google Cloud's Model Garden, with general availability "in the coming weeks". Customers can pay through Google Cloud Marketplace and count the spend against their existing Google Cloud commitments. OpenAI models will also come to Google's Antigravity coding tool and its Gemini Agent. OpenAI says Microsoft remains its primary cloud partner. CNBC notes this puts OpenAI on all three big US clouds. Separately, OpenAI expanded ChatGPT ads to 26 more countries, 89 in total. It says more than 100,000 advertisers have used the platform since it launched just over eight months ago, and ads stay limited to the Free and Go plans. Why it matters: OpenAI is chasing business customers wherever they already spend their cloud budgets, even inside a direct rival. Getting Codex into Antigravity means it will compete inside Google's own coding tool, against Gemini and Claude Code. Ads are a second revenue stream to point to as OpenAI raises money at a reported $1.4 trillion valuation. Sources: OpenAI · CNBC · OpenAI on ads · CNBC on ads

4. Salesforce agrees to buy Braze for about $5.66 billion in cash

Background: Braze is a listed marketing platform that sends personalised messages across apps, email, SMS and WhatsApp for about 2,770 customers, including Canva, Instacart and Venmo. Salesforce has been buying companies to feed its Agentforce AI agent platform. What happened: On Tuesday, Salesforce signed a definitive agreement to buy Braze for about $5.66 billion in enterprise value, paying $47.50 a share in cash. The deal needs approval from Braze shareholders and regulators, and is expected to close in Salesforce's fiscal year 2028. Bloomberg, as summarised by Techmeme, reports that closing is expected from February 2027. Why it matters: Big software companies are buying real-time customer data and messaging tools so their AI agents have something useful to act on. Sources: Salesforce · AI Daily funding tracker (Bloomberg summary)

5. Big rounds: legal AI Legora reaches $8.8 billion, and a former OpenAI research chief's factory start-up hits $1.5 billion

• Legora: The Swedish legal AI company raised a $550 million Series E led by Atreides Management at an $8.8 billion valuation. Baron, Capital Group, Fidelity, Glade Brook and J.P. Morgan joined as new investors. It says annual recurring revenue has passed $200 million and that more than half of the AmLaw 50 are customers. The round comes six weeks after US rival Harvey raised $550 million at $15.5 billion. The Next Web
• Arda: Bob McGrew, OpenAI's former research chief, came out of stealth with about $230 million raised at a $1.5 billion valuation, led by Altimeter, Accel and Khosla. Arda's AI helps engineers reprogram assembly lines when a design changes, and it's already in use at Anduril. McGrew describes it as doing "for manufacturing engineers what Claude or Cursor does for programmers". CNBC
• ASI and Pigment: ASI, which models air traffic, energy grids and military logistics, raised $325 million at a $3 billion valuation, led by Spark Capital. Paris-based Pigment, which makes AI planning software, raised $250 million at $2.3 billion, led by an EQT-managed fund, with an investment from Nvidia planned. Tech Startups round-up · AI Daily funding tracker

Why it matters: The public markets are nervous about AI, but private investors are still paying unicorn prices for companies selling AI into specific industries with real revenue, such as law, factories and finance teams.

6. Competitor product moves: GitHub makes its own agent the default, and a code-testing start-up becomes a unicorn

• GitHub Copilot: VS Code 1.143 makes GitHub's own Copilot harness (the software that runs the agent) the default for new sessions. A new "Compare models" preview runs the same task through several models side by side, mixing Copilot, Claude and Codex harnesses, then lets a judge model pick a winner and combine the best ideas. Companies can now ban the Claude and Codex harnesses through policy, and GitHub says the older "Local" harness is being retired. VS Code can also run the MAI Code 1.1 Flash model on the device, for machines with at least 96 GB of GPU memory. VS Code release notes
• Blacksmith: The company that runs the automated build-and-test jobs code must pass before it ships raised $66 million led by Sequoia at a $1 billion valuation, two months after being valued at $550 million. It now runs 90 million checks a week, up from 5 million at the start of the year, and says it has more than 10,000 customers. Its CEO says AI tools like Cursor, Codex and Claude Code have made the bottleneck checking code, not writing it. Fortune
• Cursor: No new release since last week's shareable canvases for cloud agents, the Environments API beta and support for environments of up to 300 repositories. Cursor changelog

Why it matters: GitHub is pulling customers onto its own agent while still letting them try rival models inside its tools. That puts pressure on Cursor and on Claude Code and Codex as standalone products. Meanwhile, money keeps flowing to the companies that check AI-written code.

Key hires

No notable new hires at coding or AI-agent companies since the last briefing. Outside coding, Meta's long-time policy chief Joel Kaplan is leaving after 15 years, with Dina Powell McCormick taking over external affairs. Axios · Reuters via Investing.com

Also worth a look

• Nscale's IPO pitch: The FT reports that Nscale still plans to list in New York before year-end at a $30 billion to $35 billion valuation. CEO Josh Payne told staff it has more than $100 billion of contracted revenue, but only $2.6 billion of its roughly $103 billion contract value was active at the end of August. MarketScreener summary of FT
• Google follows Amazon against Nvidia: Google has open-sourced TorchTPU, built with Meta's PyTorch team, so existing PyTorch code can run on its TPU chips with minimal changes. It comes a day after Amazon's similar move. Google Cloud · TechCrunch

Coming up

Tesla reports third-quarter results after the US market closes today, and analysts are watching its filings for any mention of the merger talks ahead of its 3 December annual meeting. Anthropic's public S-1 could land as soon as Friday. Amazon, Microsoft and Google report cloud results next week. Reuters via Investing.com · Yahoo Finance · CNBC