The biggest week in AI this year: Anthropic surpasses OpenAI in valuation, Google fires back at I/O 2026, the EU rewrites its AI rulebook, and OpenAI files for its IPO. Here is everything that moved the needle.
Cover Story: Anthropic Becomes the Most Valuable AI Company
Anthropic closed a $65 billion Series H funding round on May 28th, reaching a staggering $965 billion valuation — overtaking OpenAI's $730 billion and approaching the first trillion-dollar AI company milestone.
- Valuation doubled from $380B in February — in just 3 months
- Led by Altimeter Capital, Dragoneer, Greenoaks, and Sequoia Capital
- Amazon contributed $5 billion to the round
- Revenue run-rate: $47 billion, driven largely by Claude Code adoption
- Expanded compute partnership with Google and Broadcom for multi-gigawatt infrastructure
- A new Mythos-class model is expected to launch in the coming weeks
This is the financial proof that the adoption is real and accelerating fast.
Policy and Regulation: EU AI Act Gets Its First Major Rewrite
On May 7th, European negotiators agreed on significant amendments to the EU AI Act — acknowledging the original timeline was too ambitious.
- High-risk compliance deadline extended 16 months: August 2026 to December 2027
- Product-related requirements shifted: August 2027 to August 2028
- National regulatory sandboxes delayed by one full year
- Two new prohibited practices added: non-consensual intimate imagery and CSAM generation (effective December 2026)
- Formal adoption vote expected in June; publication likely in July
The Debate: Google I/O 2026 — Agent Wars and Pricing Strategy
Google held its largest developer conference on May 19th with a wave of announcements that signals a new phase of the AI wars.
Key Launches
- Gemini 3.5 Flash — frontier performance at one-third the cost of comparable models
- Gemini Omni — unified model across text, images, audio, and video
- Ask YouTube — conversational interface directly with video content
- Gemini Spark — general-purpose AI agent performing autonomous actions across apps
- AI Ultra subscription cut 60%: $250/month to $100/month
- Gemini 3.1 Ultra supports a 2 million token context window across all modalities
Observers debate whether this aggressive pricing signals defensive competition or confidence in a high-volume, lower-margin model strategy.
Quick Takes
Vatican Weighs In on AI
Pope Leo XIV published the first papal encyclical dedicated to AI, calling on global leaders to disarm AI and ensure it serves humanity.
80-Year-Old Math Problem Solved by AI
An OpenAI model autonomously solved a mathematical problem that had resisted human efforts for 80 years — a landmark in AI reasoning capability.
OpenAI Files for IPO
OpenAI filed initial public offering paperwork after resolving the Elon Musk lawsuit. GPT-5.5 Instant is now the default model across the platform.
Meta Training Data Controversy
Leaked audio revealed Meta used employee data and internal conversations for AI training — before laying off 8,000 workers. Major ethics questions raised.
If even one of these stories shifted how you see what is happening in this industry, then this newsletter is doing its job. — Rudy Shoushany
