Google's Cloud Doubled and Its Stock Fell 8%, the Fed Splits and Jio Pops 21%
By Jose Ruiz · · 6 min read
Good morning, crowd.
Two of the biggest AI spenders on earth reported on the same night. One stock jumped 4%. The other fell as much as 8%. Meanwhile, the Fed split in a way it hasn't since 1992, and India's biggest IPO ever popped on day one.
In today's Founderscrowds:
☁️ Microsoft vs. Google: same AI bet, opposite reactions
🏦 The Fed holds, but two officials wanted a hike
🇮🇳 Jio jumps 21% in India's biggest IPO
🤝 A $1.7B exit for an AI insurance startup
Your call before you read:
After this week, which would you rather own for the next 5 years? |
Read time: 4 minutes
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LATEST DEVELOPMENTS
BIG TECH
☁️ Google's Cloud Doubled. Its Stock Still Fell 8%
Split screen: Microsoft and Alphabet both reported Wednesday night, both with booming cloud businesses. Wall Street loved one and punished the other. The difference? Who is still making money after paying for all those AI chips.
The details:
Microsoft: Azure hit $33.2B, up 48%, and earnings beat estimates. It also spent about $5B less on data centers than Wall Street expected. Shares rose about 4% after hours
Alphabet: Google Cloud more than doubled to $30.7B. But revenue just missed, and profit was hit by an $8.7B paper loss on its investments
The real problem: Alphabet spent a record $51.4B on AI buildout in one quarter, pushing free cash flow to negative $9.1B
Alphabet shares fell as much as 8% after hours
Why it matters: Investors no longer reward AI spending on its own. They want proof the spending pays for itself. Microsoft showed growth and discipline. Google showed growth that is still burning cash. That same test is coming for every AI company heading to IPO, including Anthropic.
Read the Alphabet numbers · Read the Microsoft numbers
THE FED
🏦 The Fed Held Rates. Two Officials Wanted a Hike
Plot twist: The Fed kept rates at 3.75% to 4%, but the vote was 10-2. Governor Lisa Cook and Cleveland Fed President Beth Hammack both voted to raise rates now.
The details:
First time since 1992 that a Fed governor and a regional Fed president dissented on the same side
Inflation hit 3.7% in September, still well above the Fed's 2% target
The Fed already raised rates in September, and traders saw a 78% chance of another hike in December
Chair Kevin Warsh said the Fed is waiting for more clarity, six days before the midterms
Why it matters: Rate hikes make borrowing more expensive and pull money toward safe yields and away from risky bets like startups and IPOs. If December brings another hike, expect tougher terms for companies raising money in early 2027.
THE IPO
🇮🇳 Jio Jumped 21% in India's Biggest IPO Ever
The pop: On Sunday we told you Reliance's Jio Platforms drew 22x more demand than shares available. On Wednesday it listed, opening at ₹1,358, 21% above its IPO price of ₹1,119.
The details:
₹30,213 crore raised, the largest IPO in India's history
Market value of about ₹12.5 lakh crore, second only to its parent Reliance among Indian listed companies
Big institutions were 70x oversubscribed. Retail investors were just 2.7x
212 anchor investors put in about ₹8,110 crore before the IPO even opened
Why it matters: Jio proves the giant IPO is back, and not only in the US. With Anthropic now filing to list too, 2026 is shaping up as a huge year for mega-listings. For investors, the lesson is that the biggest first-day gains often go to institutions that get allocations, not to retail buyers on day one.
THE EXIT
🤝 A $1.7B Cash Exit for an AI Insurance Startup
The deal: Insurance software giant Guidewire agreed to buy London-based Hyperexponential for $1.7B in cash, plus up to $400M more if it hits revenue targets.
The details:
Hyperexponential builds AI software that helps insurers price and underwrite risk
About 600 insurers in 40 countries use it
It raised only about $90M since 2017, from backers including Andreessen Horowitz and Battery Ventures
The deal is expected to close next year
Why it matters: Turning roughly $90M of funding into a $1.7B to $2B cash exit is the kind of result venture investors dream about. It also shows the AI exit playbook in action: boring, profitable industries buying AI startups instead of building it themselves.
QUICK HITS
📰 Everything else you need to know
Intel agreed to buy Israeli quantum computing startup Classiq for about $2.3B. Read more
GE Vernova will pay $9B for power grid equipment maker Trench Group, another bet on AI-driven electricity demand. Read more
OpenAI reportedly plans to buy Google's AI chips, a sign it wants options beyond Nvidia. Neither company has confirmed. Read more
Apple unveiled its first touchscreen MacBook Pro with an OLED display, plus a $699 iPad mini and a $1,499 iMac. Read more
🎓 Catch up on Founderscrowds
Tomorrow: it's launch day for our Investment of the Week. Keep an eye on your inbox.
That's a wrap. Hit reply and tell us: is AI spending a bubble, or just the cost of winning? We read every one.
See you tomorrow,
Jose, Alberto & the Founderscrowds Team
Disclaimer: Founderscrowds is a media company. We are not a broker-dealer, funding portal, investment adviser or financial planner, and we do not collect or hold investor funds. Nothing in this email is investment, legal or tax advice, or an offer to buy or sell any security. Views on any company or deal are the writers' opinions and are not tailored to you. Some content may be sponsored or affiliate-linked, and writers may hold positions in companies we cover. Data comes from third-party sources and is not guaranteed. Private market investments are speculative, illiquid and can lose their entire value, and many offerings are limited to accredited investors.
Quick answers
Why did Alphabet stock fall after Q3 2026 earnings?
Alphabet reported Q3 2026 revenue of $127.6 billion, slightly below estimates, and an $8.7 billion paper loss on equity investments. Record capital spending of $51.4 billion pushed free cash flow to negative $9.1 billion, and shares fell as much as 8% after hours even though Google Cloud revenue more than doubled to $30.7 billion.
How fast is Microsoft Azure growing?
Microsoft disclosed Azure revenue of $33.2 billion for its fiscal first quarter of 2027, up 48% from a year earlier and above analyst estimates.
What did the Fed decide in October 2026?
On October 28, 2026, the Federal Reserve held its benchmark rate at 3.75% to 4% in a 10-2 vote. Governor Lisa Cook and Cleveland Fed President Beth Hammack dissented in favor of a quarter-point hike.
How did the Jio Platforms IPO perform?
Jio Platforms listed on October 28, 2026 at ₹1,358 per share, a 21% premium to its ₹1,119 IPO price, after raising ₹30,213 crore in India's largest IPO.
Sources
Fortune: Alphabet's Google Cloud revenue doubles as cash flow stays deep red
Traders Agency (citing CNBC): Microsoft beats Q1 FY27 estimates as Azure tops $33 billion
Fortune: Fed holds rates steady as a governor and president dissent together
TelecomLead: Jio Platforms IPO lists at 21% premium
TechCrunch: Guidewire buys Hyperexponential for $1.7B in cash
Haaretz: Intel to acquire Classiq
Bloomberg: GE Vernova to acquire Trench Group
The Neuron: Everything that happened in AI, Oct 28
Tom's Guide: Apple Pro and Tell event
All story images are AI-generated illustrations.
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Disclaimer: Founderscrowds is a media company. We are not a broker-dealer, funding portal, investment adviser or financial planner, and we do not collect or hold investor funds. All content is for informational and educational purposes only and is not investment, legal or tax advice or an offer to buy or sell any security. Views on any company or deal are our writers' opinions. Some content is sponsored. Private market investments are speculative, illiquid and may result in the loss of your entire investment; many offerings are limited to accredited investors. Read full disclaimer
