SpaceX went public just a few days ago in the largest IPO in history. And while everyone is focused on the stock, which has entered a correction after its initial rally, the company is already preparing to raise even more money through a bond offering. So far, nothing too surprising.
Because the really interesting story is neither the stock nor the bond.
It's the company's AI business, which keeps landing massive deals worth eye watering amounts of money.
Let's quickly get these out of the way first, since they're what most people are talking about.
SpaceX made its Nasdaq debut on June 12 at an IPO price of $135 per share. The start was explosive. The stock surged, the company's market capitalization surpassed Amazon and, for a brief period, even Microsoft , while Elon Musk became the world's first trillionaire.
Then came the correction.
The stock fell 9% one day and 11% the next, marking its third consecutive losing session. Even after the decline, however, shares remain roughly 37% above the IPO price.
But there is a catch.
The average investor who bought in the open market after the IPO has seen nearly all of their gains disappear.
And as if that weren't enough, the company also announced a bond offering.
These are senior unsecured notes, with the goal of raising around $20 billion. The proceeds will be used to repay bridge financing and for general corporate purposes. What's particularly interesting is that the company also disclosed it already has $100.8 billion in cash on its balance sheet.
"So why does it need even more money?"
That's exactly where the real story begins.
To understand this, we need to go back a bit.
Earlier this year, Musk merged SpaceX with xAI, his artificial intelligence company. Along with that came the massive Colossus data centers, originally built to power Grok, Musk's AI chatbot.
Now, however, SpaceX is doing something very smart.
It is renting out that infrastructure to other AI companies.
In other words, it is selling computing power, or what the industry calls "compute."
And the deals keep coming.
Let's look at them one by one.
The biggest deal of them all.
Anthropic, the company behind Claude, is paying SpaceX $1.25 billion per month for access to 325,000 Nvidia GPUs at the Colossus facilities in Memphis.
The agreement runs through May 2029.
There is, however, an important detail hidden in the fine print.
After the first three months, either party can terminate the agreement with 90 days' notice.
So those "guaranteed revenues" may not be quite as guaranteed as they appear.
The second major agreement.
Google will pay $920 million per month for access to approximately 110,000 Nvidia GPUs, from October of this year through June 2029.
Why?
To support the explosive demand for Gemini Enterprise, its AI platform for large organizations.
A startup developing open source AI models.
Reflection AI will pay $150 million per month starting July 1 through 2029.
If the agreement runs its full course, we're talking about roughly $6.3 billion in total value.
In return, the company gets access to Nvidia's latest GB300 GPUs.
This one is even more interesting because it is not a compute deal.
It is an acquisition.
SpaceX announced the purchase of Cursor, the company behind the popular AI coding assistant, in an all stock transaction valued at $60 billion.
Of course, it's not all sunshine and rainbows.
Behind the impressive numbers lies a different reality.
The company's AI division reported an operating loss of $2.5 billion in a single quarter, while generating only $818 million in revenue.
Capital expenditures were also enormous.
The company spent $10.1 billion in one quarter alone, with $7.7 billion directed toward AI investments.
In simple terms?
SpaceX is spending aggressively to build out this infrastructure.
Now it is trying to monetize it, and these compute deals are the mechanism for doing so.
But with 90 day termination clauses built into some of these agreements, nobody can guarantee that these contracts will remain in place until their scheduled end dates.
That is what makes the story both exciting and risky at the same time.
