Alphabet is spending roughly $200 billion this year to build out its AI capacity, and Ruth Porat, the company’s president and chief investment officer, told Fortune’s Alyson Shontell that Google’s plan for next year will be even more substantial.

Alphabet expects capital expenditure (capex) to “increase significantly” next year, she said at Fortune’s Most Powerful Women Summit in Santa Barbara, Calif., adding that the company remains “capacity constrained” as demand grows.

“The demand for compute—because of the value that our partners are seeing in the enterprise, in governments, what we’re seeing across our platform—suggests that we’re in the buildout here now,” she said. “We do see this as an opportunity that extends for quite some time.”

“The thing that is true throughout history is anything that is not built for the long run won’t endure for the long run,” Porat said. She noted that Alphabet’s capex is itself a payoff from a strategy devised years ago, starting with Google’s 2016 pivot from “mobile first” to “AI first.”

MORE FROM FORTUNE

The New Blueprint for Power: MPW Kicks Off | Fortune Daily

‘The norm will be to trade with agents’: Crypto founders learn to love—and fear—AI – Angelica Ang

Binance weighs stock access in markets including Hong Kong and South Korea, says co-CEO Richard Teng – Angelica Ang

Top execs say the $124 trillion Great Wealth Transfer, women entrepreneurs, and veterans are poised to remake the financial landscape – Emma Burleigh

‘If you take your foot off the pedal at all, you will start to stall’: Women in C-suite roles have stagnated, and the reasons go beyond the pipeline – Sasha Rogelberg

This 39-year-old quit 80-hour consulting weeks to make underwear for his struggling family business. He credits ‘sweaty feet’ for record profits – Nick Lichtenberg

I built a family business from scratch to $200 million. Now I’ve become its bottleneck – Rostyslav Vovk

Despite his $200 million success, Matthew McConaughey spent a weekend in the desert reading 20 years of bad reviews—he says some of them had ‘a point’ – Orianna Rosa Royle

ALARMIST, MUCH?

Watch for signs of bank collapses if capital flees France, Macquarie warns

We’re not there yet, but some on Wall Street think France’s rising government bond yields, coupled with the riots, may undo certain French banks, leading to foreign depositors pulling their money out of the country.

For days, student protesters and unions have marched in the streets and clashed with police over conditions in dilapidated French schools. Pupils often complain of overcrowding in classrooms, lack of heating in winter and lack of air conditioning in summer.

Macquarie analysts Thierry Wizman and Gareth Berry have argued in a series of notes that if the rioters successfully persuade the government to increase education spending, French bond yields will rise.

“We can easily see how further increases in sovereign bond yields and/or widening riots can cause deposit flight,” they warned in a note to clients yesterday. “It was, after all, the rapid rise in bond yields in the U.S. in late 2022 and early 2023 that resulted in the liability-side collapse of Silicon Valley Bank and Republic Bank, as well as programmed liquidity interventions from the Fed for the banking system overall. More generally, rapid increases in bond yields have been associated with financial collapses in the past, and there is no obvious reason to believe that Europe’s financial institutions—especially France’s institutions—would be immune from the rapid rise in yields taking place there over the past few months.”

“The rise in underlying yields may be associated with capital fleeing from France. And if this extends to deposit flight from its commercial banks, then the prospect of an ECB intervention – say, using programs specifically directed at preserving bank liquidity, such as its refinance operations,” could be a possibility, they said.

Context: They also said there is currently no sign of this happening.

THE MARKETS

Chip stocks fold after Broadcom CEO says AI trade is like a “casino”

Tech investors lost their nerve in Asia today as shares in chipmaker SK Hynix fell more than 10% and Samsung fell 7.39%. In the Netherlands, ASML was down 1.48%. Their fear was driven in part by remarks from Broadcom CEO Hock Tan, who said at an event in Singapore yesterday that “A lot of investors have no clue what they are investing in [and] set very extreme expectations only to find out that it’s almost like they are in a casino.”

He said a lot of AI customers were “wasting money” on tokens as they experimented fruitlessly to find ways to improve their productivity. “When you are a kid, you go to a video arcade, you play. Your parents give you $10 of tokens, you finish it in 10 minutes and you haven’t learned anything,” he said. “That’s what is happening in enterprises today.”

Markets in Europe were more resilient and U.S. futures were flat before the open.

S&P 500 futures were marginally up (0.02%) this morning. The index closed flat on Friday.
In Europe, the Stoxx 600 was up 0.58% in early trading, and the U.K.’s FTSE 100 was up 0.7% before lunch.
Asia: South Korea’s KOSPI was down 5.46%. Japan’s Nikkei 225 was down 1.82%. India’s Nifty 50 was up 1.02%. China’s CSI 300 was down 0.29%.
Brent crude was $105 per barrel.
Bitcoin was at $83,586.

Stocks will probably do OK after the midterms, Deutsche Bank says

In the period from one month before the midterm elections to two months after, the S&P 500 has gone up in 21 of the previous 23 midterm years, according to Binky Chadha and Parag Thatte at Deutsche Bank.

CHART OF THE DAY

War puts the brakes on global tourism

Global tourism in Q2 was largely affected by the war in the Middle East, according to HSBC analysts Maitreyi Das and Prachi Mathur. In Q1, tourism numbers were up by 2%. But Q2 saw a 1% decline. “Around 690 million tourists traveled in the first six months of 2026, just 0.4% more than a year earlier,” they said.

NUMBER OF THE DAY

6.2%

The annualized percentage increase in spending per household on U.S. credit and debit cards in September, according to Bank of America. The increase is “the third strongest we’ve seen in the last four years,” Liz Everett Krisberg and David Tinsley said in a note.

THE FRONT PAGES TODAY

Top economies heading for biggest budget deficits since Covid, IMF warns – FT

Feds search Rep. Ilhan Omar’s home in immigration probe – Axios

Cyber attack hits hundreds of French supermarkets, heating fridges to 122°F and sparking fires – CNBC

Dating-app company Bumble in advanced talks to go private at $1 billion valuation – WSJ

Infosys chairman calls job fears ‘Hogwash’ as AI spurs business – Bloomberg

After Russian diesel deal, Trump faces new crisis over Ukraine – NYT

Pickleball company files for bankruptcy as founder acknowledges business mistake: ‘I own it’ – NY Post

ONE MORE THING

Retailers: Do not be rude to Kelly Clarkson—she will go to war against you

One of the most entertaining low-stakes battles on the internet of the last few days has been singer Kelly Clarkson’s vendetta against a Brooklyn toy store whose clerk, she alleges, assumed she was poor and declined to help her buy a $15,000 mechanical bird. “Wow, dude. You’re an idiot and just lost a huge sale. But y’all should go check out Art of Play in Brooklyn if you enjoy being treated like Julia Roberts’ character in Pretty Woman,” she said on X.

The shop responded on Instagram: “Yesterday, Kelly Clarkson visited us in Brooklyn and inquired about buying ‘Molly,’ a one-of-a-kind singing and dancing bird automaton who plays an important role in the magic shows we host here. Molly is permanently attached to the wall and isn’t for sale.” And then: “Imagine our surprise when our small local business was suddenly attacked by 8 million people who have never visited our store. It’s been a surreal experience to be the focus of such widespread outrage after just one mention by a celebrity.”

Clarkson was having none of it. “So the whole conversation we had when I asked you if it was for sale whilst pointing to the price tag hanging on the wall with the title Singing Bird didn’t happen as you elevator eyed me saying in a condescending tone ‘yes, it’s for sale but it costs 15,000 dollars so if you’d like me to find something comparable for you I can.’ That all never happened and now it’s not for sale. Okay, cool. So you’re not only rude, you’re also a liar. Got it.”