Google and SpaceX Forge $920 Million Monthly Deal

Elon Musk’s company, SpaceX, announced a significant deal with Google. The tech giant will pay SpaceX $920 million each month for computing resources. This agreement supports SpaceX in its preparation for a highly anticipated initial public offering (IPO).

The partnership starts in October and will last until June 2029, potentially bringing SpaceX around $30 billion. The deal establishes SpaceX as a critical infrastructure provider amid the intense global competition in artificial intelligence (A.I.).

Google will have access to about 110,000 A.I. chips from Nvidia through this agreement, which will help meet unexpected high customer demand for its A.I. models. Back in April, Google revealed that its cloud business had contracts worth $460 billion, highlighting the immense demand for its services.

Google Cloud and SpaceX are longtime partners. This is a short-term, timely agreement to ensure we have bridge capacity to meet surging customer demand for our agent platform, Gemini Enterprise, which has been even higher than we expected.

This statement came from a Google Cloud spokesperson.

Although SpaceX did not comment, the firm previously sealed a $1.25 billion monthly deal with Anthropic, another prominent A.I. lab. Both companies are expected to go public soon.

SpaceX’s forthcoming IPO could value the company at above $1.7 trillion, potentially making Musk a trillionaire. As part of this process, SpaceX has disclosed more financial details recently to attract investors.

Musk has constructed a large supercomputer in Memphis for xAI but the company still lags behind competitors like OpenAI and Google. As SpaceX moves toward its IPO, Musk has increasingly emphasized A.I. as a revenue-generating asset. Notably, he has publicized deals with Anthropic and Google.

Additionally, Musk announced plans for a vast chip factory in Texas. Earlier, SpaceX agreed to a $60 billion acquisition of A.I. startup Cursor, known for its code-writing assistant.

The agreement with Google strengthens the connection between the two companies. Google holds a 5% stake in SpaceX. It has also considered engaging SpaceX as a launch partner for data centers in space, an endeavor called Project Suncatcher.