Trump ignored intel on China’s Nvidia spy to protect company’s stock, report says

Donald Trump apparently is so aligned with Nvidia CEO Jensen Huang—who has become the president’s key advisor on AI—that he ignored intelligence indicating that Huang was the target of a “Chinese spy plot,” and did so partly to protect Nvidia’s stock.

The New York Times spoke with people briefed on US intelligence agencies’ surveillance and granted them anonymity to discuss findings drawn from “classified intelligence.” According to sources, about a year ago, Trump was briefed that “Beijing was getting reports from someone with direct access” to Huang. That “someone” was Alice Huang, or Huang Le, a Chinese citizen and former top executive at a Singapore cloud company called Megaspeed.

According to sources, the US had already suspected that Alice Huang—who is not related to Jensen Huang—was helping China evade export controls to gain access to high-end Nvidia chips through Megaspeed. But it alarmed investigators to discover that she may have used her role at Megaspeed to gain direct access to Jensen Huang. It’s now believed she may have leveraged that closeness to feed China intel not only on one of America’s leading AI companies, but also to influence Trump’s thinking on AI. As Treasury Secretary Scott Bessent noted last month ahead of Trump’s AI talks with China President Xi Jinping, “the president is completely aligned with Jensen Huang, the CEO of Nvidia.”

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https://arstechnica.com/tech-policy/2026/10/report-trump-did-nothing-with-intel-that-china-planted-spy-close-to-nvidia-ceo/




Google admits AI search makes less money, but it’s fixing that with more ads

Google parent Alphabet reported its Q3 financial results on Wednesday afternoon, showing a healthy rise in revenue for the months of July to September. But the company’s stock price has taken a beating, marking one of the largest post-earnings drops in its history. It comes down to several troubling aspects of the new report, including an admission by the company that AI search isn’t earning as much as organic search, and despite that, Google expects to spend even more on AI next year.

The company took in almost $128 billion in Q3 2026, earning more than $26 billion in net income. These may sound like good numbers, but financial markets are not impressed. While revenue is up 25 percent versus last year, net income is almost $9 billion lower. As of this story’s publication, the stock price is down almost 12 percent, and it was down about 13 percent earlier in the day.

While revenue was up 25 percent year over year, analysts expected more. Google reported earnings per share of $2.12, but the consensus projection ahead of Wednesday was $3.02. Google’s Cloud products actually beat expectations, crossing $30 billion in revenue. That’s about a billion more than analyst guesses.

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https://arstechnica.com/gadgets/2026/10/google-admits-ai-search-makes-less-money-but-its-fixing-that-with-more-ads/




Google announces Gemini 4 Carbon, its latest frontier AI model that you can’t use

It’s almost like Google’s got something to prove after taking a break from releasing new frontier AI models earlier this year. Just two weeks after rolling out Gemini 4 Argon, Google has announced Gemini 4 Carbon. This isn’t the Flash model equivalent we’ve been waiting for but, rather, is an improvement on Argon, and like that model, Google is working on a staged release that could take a while.

Stop me if you’ve heard this one before: Google says its latest AI model reaches a new threshold in coding, agentic tasks, and scientific analysis. It’s so capable, in fact, that Google can’t let you use it just yet.

Gemini 4 Carbon reportedly makes big gains in cybersecurity applications. Google says the model shows a “significant leap” in vulnerability detection, validation, and remediation. Carbon is also apparently twice as likely to generate code that is free of vulnerabilities versus Argon. Meanwhile, the Chrome team claims that Carbon is 10 times better at generating “high-quality” patches compared to non-Google models. Google also notes that Carbon has increased its score by 89 points on WebDev Arena, now ranking at number four on the leaderboard.

Google has some numbers to support these vague assessments (below), showing Carbon at the top of the charts. Google positions Carbon as a totally new model, but for all we know, it could be a post-training upgrade of Argon. The two models have a lot in common, but Carbon does best Argon by slim margins in every test Google has given it. Its new model also beats GPT-6 Astra, Claude Opus 5.5, and Claude Fable 5.1 in almost every test. Benchmarks don’t tell the whole story, of course, and it’s notable that every frontier model scores in the same neighborhood in these tests. The gap between Carbon and the competition is just a few points.

https://arstechnica.com/ai/2026/10/google-announces-gemini-4-carbon-its-latest-frontier-ai-model-that-you-cant-use/




Anthropic Files for Potentially the Biggest IPO Ever as CEO Warns of Risk to Humanity From AI

Artificial intelligence giant Anthropic filed papers Monday for what could be the biggest initial public offering of stock ever even as its top executive warns that advanced AI could pose an existential threat to humanity.

The filing sets up the San Francisco company for a Wall Street debut next month, potentially eclipsing the SpaceX initial public offering in June that raised a record $86 billion. An Anthropic IPO would also put the company ahead of OpenAI in going public in what is expected to be a pair of blockbuster stock debuts for the rival AI labs.

An IPO could provide Anthropic with enormous resources to accelerate its expansion. The amount the company ultimately raises remains uncertain, as do its final valuation and offering price, but even at lower estimates, it would turn the five-year-old startup into one of the world’s most valuable companies and potentially boost the wealth of CEO Dario Amodei and his sister and co-founder, Daniela, by billions of dollars.

The 335-page document showed Anthropic’s revenue is growing rapidly, reaching more than $16 billion in the first half of the year — 14 times its revenue from the same period last year. But like many other tech companies going public, the company behind the Claude chatbot has yet to turn a profit.

Despite the losses, Anthropic, valued earlier this year at $965 billion by private investors, is reportedly set to see that value rise to $1.5 trillion or possibly $2 trillion, although its final valuation has not been established. At $1.5 trillion, Anthropic would rank among the world’s most valuable public companies, alongside Tesla.

As for money raised, the offering could bring in as much as $100 billion, according to reports, surpassing the record set by SpaceX.

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In a regulatory filing, Anthropic said it will list its stock on the Nasdaq Global Select Market under the ticker symbol “ANT.”

A Wall Street debut is planned in a jittery market

In the filing, the company said it could use some of that money on acquiring other businesses and technology as well as investing in infrastructure to grow its business to take on rivals.

Formed in 2021 by former OpenAI leaders, Anthropic is locked in a fight for dominance with that company. The two leaders, Amodei and OpenAI CEO Sam Altman, are widely seen as bitter rivals.

But they have plenty of other competitors, including Google, newer startups in the U.S. and China and SpaceX, which has an AI business. Anthropic, OpenAI and SpaceX’s AI division have all been losing more money than they make because of the huge costs of resources in building AI, fueling concerns of a bubble.

The need for cash may explain why Anthropic is rushing to tap public markets this year, and not waiting until next year, as is OpenAI’s plan. Adding to the pressure is the possibility demand for AI shares could drop, or even collapse. Investors have become jittery about the massive financing needs of the sector, and several tech companies have pulled IPO plans recently.

In addition to helping plug any cash shortfall, the IPO will shower extraordinary wealth on Anthropic’s seven founders, including Amodei and his sister. The filing didn’t directly state their ownership stakes, but other figures disclosed suggest each will end up with 1.4% of the company, a windfall of as much as $28 billion a person should the company go public at the top expected value.

Risks aplenty, but a big payoff to the founders

Dario, 43, and 39-year-old Daniela, who is Anthropic’s president, are worth $15.5 billion each, according to Forbes, which ranks them as the 176th and 177th richest in the world.

Anthropic reported a net loss of $80.7 billion in the first half of 2026, although that included a one-time, $72.4 billion charge for an accounting adjustment related to financing agreements, according to the filing. In the same period a year ago, Anthropic lost $13 billion.

Reflecting AI’s dangers, the document includes some unusual provisions, including granting those two and their five other co-founders 50.1% of shareholder votes through a special class of shares. Anthropic also has appointed independent, financially disinterested members of a so-called Long-Term Benefit Trust, holding power to appoint directors, that is designed to ensure the company doesn’t put financial interests ahead of public safety.

Another unusual feature of the filing is its long list of “risk factors,” a required disclosure for every public company but in this case one that runs nearly 100 pages — and makes for riveting reading.

Among the risks are the quotidian — the possibility it won’t be able to retain key staff or navigate regulatory roadblocks — and the horrific. The latter includes the prospect of “malicious actors” using AI models to build chemical weapons, authoritarian rulers turning to the technology to crack down on their citizens and the possibility that its AI models could go rogue and “pose catastrophic or existential risks to humanity.”

Calls for an AI slowdown

Anthropic and other leading companies have touted the technology’s potential to cure diseases and speed economic growth. But it also threatens major disruptions to jobs by reducing the need for human labor.

A string of hacking incidents by rogue AI agents also has raised fears the technology will slip free of human control to carry out harmful, life-threatening tasks.

In September, Amodei said the AI industry should slow its fast-moving development to give safety measures time to catch up. Without such a slowdown, Amodei warned AI could be capable of letting loose a swarm of agents that could take over the entire internet within six to 12 months.

He offered a plan in a post on his website to increase checks on the industry, noting that Anthropic is already undertaking part of this on its own. As for other steps, though, he said that would require coordination across the industry and with governments around the world, including authoritarian ones.

Clashes with the U.S. government

Anthropic has tried to set itself apart from other AI companies as the “good guys,” focusing on safety and responsible development as opposed to growing at all costs. Some of this sentiment stems from the company’s dispute with the U.S. government, which broke out in February when President Donald Trump and Defense Secretary Pete Hegseth accused Anthropic of endangering national security and designated the company a supply chain risk.

Anthropic sued the Pentagon over the supply chain risk designation in March for what it called an “unlawful campaign of retaliation” over its refusal to allow unrestricted military use of its technology. The legal challenge intensified an unusually public dispute over how AI can be used in warfare and mass surveillance.

ChatGPT maker OpenAI made its own deal to work with the Pentagon hours after the government punished Anthropic for its stance. Anthropic also filed a separate and narrower case involving a different rule the Pentagon is using to try to declare Anthropic a supply chain risk.

A California judge ruled in Anthropic’s favor in the first case and a Washington, D.C. judge sided with the government in the second. Both sides are appealing the decisions.

https://www.securityweek.com/anthropic-files-for-potentially-the-biggest-ipo-ever-as-ceo-warns-of-risk-to-humanity-from-ai/




Stolen AI Reasoning Could Help China Build Cheaper Rivals

OpenAI, Grok, Claude and Gemini don’t simply help us, they have also been tricked into helping China produce cheap rivals.

Frontier AI generally includes a public API to let developers interface specialized apps with their AI engine. It allows a user application to query the AI and receive a response. The response generally includes the model’s reasoning steps in reaching its response. The reasoning is returned to the model in any subsequent query, allowing the model to maintain contextual continuity of ‘thought’. 

The size of this process is kept reasonable through a process of context compaction, where the accumulated conversation history, tool calls, and workspace state are compressed into a summary before overflowing the context window.

Attackers consider any API a potential doorway into a target. In this case, can any secrets be gleaned from the reasoning output, and/or can the model itself be poisoned by malicious input? In August 2026, Stealing Reasoning Traces from Proprietary LLM APIs reported an ability to extract PII via this reasoning process. “The paper showed that encrypted reasoning from a frontier model can be replayed into a weaker model from the same provider, which can then be coerced into transcribing it,” explains Xint in a new report.

The original paper started the standard process of developer-hardening and researcher-probing. For example, OpenAI rapidly deployed mitigations to this threat, and Xint has subsequently discovered a way (which it calls Compaction Smuggling) to bypass these mitigations – which OpenAI has now also mitigated.

While OpenAI’s first mitigations reduced the threat of PII exposure and model poisoning, knowledge of a model’s reasoning process can still be stolen (compaction smuggling) and used to cheaply build a new rival AI model (distillation). Distillation is the process of using stolen AI reasoning secrets from an advanced model to help cheaply build a rival model.

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OpenAI confirmed the new issue of compaction smuggling, fixed it and awarded Xint a $6,000 bounty on October 23, 2026. Compaction smuggling moves one model’s reasoning to another model by encoding it inside a compaction requiring three steps. The first step is to obtain reasoning by submitting a task (for example, from gpt-5.6-sol). The second is to steer or shape the returned compaction. The third is to send the result to a different AI model (for example, gpt-4.1 and gpt-4o) with the request (reports Xint), “to output its input exactly as-is, which they happily did.”

Simplistically, although the process detail is more complex, Xint’s new attack still just asks a second model to decipher and decode the first model’s security. “This works because OpenAI’s August mitigations only block replaying reasoning into a different model, and the compaction call runs on the same model that produced the reasoning. The attack worked at every reasoning effort we tried,” reports Xint.

Compaction smuggling allows large-scale distillation of frontier OpenAI models. While this distillation may not seem a serious threat, it seriously is. In early September, CISA issued a warning, stating: “Likely with Chinese government awareness, DeepSeek, Moonshot AI, Alibaba, MiniMax, StepFun, and Z.AI extracted billions of tokens across millions of exchanges/requests from U.S. frontier AI models, including variants of Claude, GPT, Gemini, and Grok, since at least late 2024. DeepSeek has conducted organized campaigns since at least 2024 targeting reasoning capabilities, specialized optimizations, and domain-specific functions to train its R1 and V3 models.” 

The examples of Chinese AI being used against US interests are myriad. The tragic irony is that much of this capability may have been stolen (distilled) from western AI.

Related: Beijing Hits Back at Anthropic CEO’s Call to Curb China’s AI Development

Related: China Defends DeepSeek After US Ban of Its AI From Government Systems

Related: DARPA Selects Xint to Use AI in Securing Military Messaging Apps

Related: FBI Chief Says He’s ‘Deeply concerned’ by China’s AI Program

https://www.securityweek.com/stolen-ai-reasoning-could-help-china-build-cheaper-rivals/




Updated Google privacy policy says your Gmail might be used for advertising

Using Google’s products and services has always been fundamentally precarious—doing so gives the world’s largest advertising company a lot of juicy personal data. Google has long said it won’t use the sensitive data from products like Gmail, Drive, and Photos for ad personalization, but a change to the company’s privacy policy appears to dismantle that firewall.

On October 16, Google issued an update to its privacy policy, spotted by Android Authority. The ad personalization section used to include a clear limit on data from certain apps. “We don’t show you personalized ads based on your content from Drive, Gmail, or Photos,” the document said. Now, Google has updated it with the following language.

Updated language on when your sensitive data might inform ads.

Credit: Google

Updated language on when your sensitive data might inform ads. Credit: Google

This equivocation opens the door to using data from apps like Gmail and Photos in ads when it’s shared with other Google services, and it just so happens Google has a mechanism for doing that, with Personal Intelligence. The company released Personal Intelligence in early 2026, allowing users to hand data from multiple apps to Google AI products. The idea is that the added context from your existing data will lead to better AI answers, but it’s also proving to be a privacy minefield.

Personal Intelligence connects your data to the Gemini app but also to features like AI Mode search. While the Gemini app does not currently have ads, you may see sponsored content in AI search tools. Google’s changes to the privacy policy appear to acknowledge that data shared with AI search via Personal Intelligence could, therefore, contribute to ad personalization.

According to Google, this clarification still doesn’t mean ads are “based directly” on your personal data. Here’s the company’s full statement:

“Connecting your apps is entirely opt-in. Ads will continue to be relevant to things like your query, the context of the response and your interests. Ads will not be based directly on your Gmail inbox or Photos library, and as always, sensitive information will not be used to tailor ads.”

Google’s statement is essentially a roundabout way of confirming that Workspace and Photos data may inform ads. If you interact with AI Mode while Personal Intelligence is enabled, there’s a chance that summaries and insights from your data will inform the answers you get. Because that same data is used for ad targeting, it’s accurate to say that your personal data is an element of ad targeting in AI search. The privacy policy now makes that clear.

https://arstechnica.com/gadgets/2026/10/updated-google-privacy-policy-says-your-gmail-might-be-used-for-advertising/




China APT Uses AI Pentest Tool Artex in ConnectWise Attacks

The state-sponsored hackers targeted hundreds of organizations and gained privileged access to some environments.

The post China APT Uses AI Pentest Tool Artex in ConnectWise Attacks appeared first on SecurityWeek.

https://www.securityweek.com/china-apt-uses-ai-pentest-tool-artex-in-connectwise-attacks/




LiteLLM Compromised in Fresh Supply Chain Attack

Hackers used compromised GitHub CLI OAuth tokens to push and approve malicious packages on PyPI and Docker.

The post LiteLLM Compromised in Fresh Supply Chain Attack appeared first on SecurityWeek.

https://www.securityweek.com/litellm-compromised-in-fresh-supply-chain-attack/




Advertisers Pull Meta Ads That Had Unwanted AI Glow-ups

Under Meta’s new terms coming into play Oct 30, advertisers are “solely responsible” for whatever its AI creates https://www.adweek.com/media/advertisers-pull-meta-ads-that-had-unwanted-ai-glow-ups/




OpenAI’s latest AI models are coming to Google Cloud and Antigravity

Google would certainly prefer that everyone used its Gemini models with Google Cloud services, but soon, you’ll have more options. OpenAI and Google have come to an arrangement that will see the former’s frontier models arrive in Google Cloud services. Perhaps more importantly, GPT models will soon appear in Antigravity, Google’s agent-powered coding tool.

For enterprise customers and AI enthusiasts, OpenAI’s latest model will appear in Google’s “Model Garden” in the coming weeks, adding to its 200-plus options. The garden already offers access to Google’s Gemini models, as well as an assortment of open models like Mistral, Llama, and Gemma. Anthropic’s Claude AI has also been available for some time. Google says it’s now the only large cloud provider offering access to all three leading closed LLMs.

While OpenAI notes that Microsoft continues to be its primary cloud partner, the full suite of current GPT 6 and 6.1 models—Astra, Sol, and Luna—will launch on Google Cloud. Astra will naturally cost the most to run, but Google’s system supports dynamically moving workloads between LLMs based on performance, latency, and efficiency.

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