Top stories today:

1. Microsoft, OpenAI relationship said to be fraying
2. Netflix beats estimates with 5.1M new subscribers added in Q3
3. Sam Altman’s Worldcoin drops “coin” in rebrand
4. China GDP +4.6% YoY, in line with expected, as stimulus stepped up
5. U.S. VC firms raise 2.4x for opportunity funds in 2024

0. Data and calendar

Listen to our AI-generated podcast summarizing today’s newsletter:

1. Microsoft, OpenAI relationship said to be fraying

Satya Nadella reportedly reconsidered Microsoft’s investment plans after Sam Altman was briefly ousted by OpenAI’s board last Nov.:

• OpenAI’s financial pressure and stability concerns have strained the tie-up.

• Securing more compute power has become a challenge for OpenAI.

• Microsoft engineers allegedly downloaded OpenAI software without protocols.

• $5.4B in compute cost by 2024-end is expected to be spent by OpenAI.

• $650M paid by Microsoft to hire Inflection staff, an OpenAI competitor.

2. Netflix beats estimates with 5.1M new subscribers added in Q3

Analysts estimated Netflix would add 4.52M new subscribers in the third quarter:

• Europe, the Middle East, Africa, and the Asia-Pacific accounted for most of the new subscribers.

• +41% YoY quarterly net income to $2.36B.

• +15% quarterly revenue to $9.83B.

• 30% operating margin, vs. 22% a year ago.

• 282.7M subscribers in total.

• Stock +5% after-hours.

4. Sam Altman’s Worldcoin drops “coin” in rebrand, unveils new hardware

The eyeball-scanning Orb will be powered by NVIDIA’s Jetson chip and feature a new design:

• World is the new name of Altman’s startup.

• 5x AI performance with fewer parts over the previous Orb.

• World is working to integrate its identity verification into other software to combat deepfakes, listing FaceTime, WhatsApp, and Zoom as potential partners.

• Worldcoin faced scrutiny in some markets over privacy concerns. The updates aren’t likely to limit such issues.

5. China GDP +4.6% YoY, in line with expected, as central bank steps up stimulus

• Industrial production +5.4%, vs. +4.6% expected, from +4.5% in the prior quarter.

• Retail sales +3.2%, vs. +2.5% exp., from +2.1%.

• The PBOC kicked off a previously announced $42B low-cost loan program and a new swap facility, which has already received $28B in applications.

• Likely goal is to reach 5% GDP by year-end.

• Chinese stocks +4% on Fri.

7. U.S. VC firms raise 2.4x for opportunity funds in 2024, but still below 2022 levels

• $3.4B raised for opportunity funds in 2024 YTD, 2.4x the $1.4B raised in 2023.

• 9 funds were closed this year so far.

• 2022: $12.1B was raised across 120 opportunity funds.

8. U.S. corporate ideology shifted left since 2001, with Silicon Valley polarized

U.S. tech execs. increasingly supporting either the Republican or Democratic candidates

After a slower start, Harris has stepped up in media appearances since becoming the Democratic nominee

9. Google reorganizes AI teams, moves executive overseeing search to chief technologist role

Prabhakar Raghavan, who led search and ads products, will be replaced by his subordinate Nick Fox:

• Raghavan will work with Sundar Pichai under his new role.

• The Gemini team is moving to Google DeepMind under now-Nobel laureate Demis Hassabis.

• Google Assistant teams is shifting to Platforms & Devices.

• The shake-ups arise as Google faces pressure from OpenAI and other AI rivals.

11. Retail sales exceed projections with +0.4% MoM in September

• Retail sales: +0.4% MoM in Sep., vs. +0.3% expected, from 0.1% in Aug.

• Core retail sales: +0.5%, vs. 0.1% expected, from 0.1%.

12. Interesting videos, posts, and memes

13. Other headlines

AI

• Pony AI, Chinese self-driving startup, files for U.S. IPO.

• X changing privacy policy to allow 3rd parties to train AI on user posts.

• ChatGPT app debuts on Windows in preview.

• Google’s NotebookLM launches business pilot with early feature access.

Tech

• Intel seeks to sell stake in Altera subsidiary at valuation of ~$17B: sources.

• Samsung delays ASML chip gear deliveries for new US factory: sources.

• Google to block election ads after polls close on Nov. 5.

• iPhone 16 sales soar 20% in China debut as demand returns.

• AWS CEO says employees can quit if they dislike return-to-office mandate.

Tech & law

• FCC will soon require all hearing aids, phones to work together.

• Musk’s X seeks to steer lawsuits to conservative court in Texas.

• Trump says Tim Cook called him to complain about EU.

• TSMC responds to U.S. probe on China ties, says it’s law-abiding.

Biotech

• Consumer groups ask FTC to block Novo Holdings-Catalent deal.

• Merck says experimental RSV treatment protected infants in trial.

• Kezar rejects Concentra bid that “substantially undervalues” the biotech.

Business

• Gold tops $2.7K for 1st time ever.

• BP weighs sale of minority stake in offshore wind business: sources.

• Buffett’s Berkshire continues to reduce Bank of America stake.

Crypto

• Stripe is said to acquire crypto infra. startup Bridge for $1B.

• Kraken launches wrapped BTC token kBTC.

• FBI arrests Alabama man for SEC X hack that spiked BTC price.

U.S. politics

• Harris says death of Sinwar is opportunity to end Gaza war.

• Elon does independent rally for Trump with 800 participants.

• Harvard donations -15% YoY to $1.2B in FY24.

• Nate Silver has model at 50/50, doesn’t think momentum likely.

World

• Netanyahu to hold security meeting on hostage deal after Sinwar’s death.

• Hezbollah vows escalation after Sinwar’s death, Iran defends “resistance.”

• Orban says Zelensky’s victory plan is poised to plan.

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