Space Exploration Technologies Corp. (NASDAQ: SPCX) is pursuing a massive expansion of its AI computing capabilities, aiming to increase capacity from 1.4 gigawatts to nearly 10 gigawatts by the end of 2027. According to Financial Times Lex columnist John Foley, this expansion could require an estimated $500 billion in total investment, assuming a cost of roughly $50 billion per gigawatt.
The company is leveraging its rocket-building expertise to scale terrestrial data centers. SpaceX currently has approximately $90 billion in cash on hand, which is significantly less than the estimated cost of the expansion. However, CFO Bret Johnsen has stated that new computing investments can pay for themselves in less than a year.
SpaceX is already generating revenue from these efforts through agreements with major technology firms. The company sells computing capacity to Anthropic under a contract worth $1.25 billion per month and to Alphabet Inc.'s (NASDAQ: GOOGL) Google under a deal worth $920 million per month. These contracts represent approximately $26 billion in annualized payments once operating at full rates. SpaceX has also held talks with Microsoft Corp. (NASDAQ: MSFT) regarding a similar arrangement.
Despite these revenue streams, the plan faces risks. Foley noted that competitors could bring more capacity online, potentially driving down rental prices. Additionally, SpaceX’s agreements with Anthropic and Google allow for termination on 90 days' notice after their respective initial periods. The company is reportedly seeking another $40 billion to purchase Nvidia Corp. (NASDAQ: NVDA) chips to support the expansion.
