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Google to pay SpaceX $920M a month for compute capacity at xAI data centers

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Re: Google to pay SpaceX $920M a month for compute capacity at xAI data centers

#331

Post by [deleted] »

rdiddly wrote: post #304
noir_lord wrote: post #272

Earlier quoted context omitted.

> Truly a brilliant deal for everyone involved. Except for people who have pensions/investments in whole market class investments who become exposed to an over valued company with a propped up value.

The key there is "whole market." This is still a tiny sliver of the whole market and most people's exposure to it is minimal. Still a wealth extraction move ultimately, but like many other such moves, the few pull just a little from each of the many. Nobody individually goes broke, but the whole class gets slightly poorer. It takes a village to raise a billionaire!

[deleted]

Re: Google to pay SpaceX $920M a month for compute capacity at xAI data centers

#332

Post by mock-possum »

tristanj wrote: post #205

This is a masterful piece of financial engineering by Google and SpaceX. Google purchased 10% of SpaceX over a decade ago. After dilution they probably own around 5%. SpaceX is valued at a whopping 94x revenue. This deal increases SpaceX's revenue by $11 billion per year. If SpaceX maintains this revenue multiplier, then this single deal boosts SpaceX's valuation by 94 x 11 billion = $1 trillion dollars. Google owns…

Utterly nauseating. Why would google help prop up this company and its figurehead? Maybe this is finally the straw that breaks the camel’s back for me and google.

Re: Google to pay SpaceX $920M a month for compute capacity at xAI data centers

#333

Post by seydor »

tristanj wrote: post #205

This is a masterful piece of financial engineering by Google and SpaceX. Google purchased 10% of SpaceX over a decade ago. After dilution they probably own around 5%. SpaceX is valued at a whopping 94x revenue. This deal increases SpaceX's revenue by $11 billion per year. If SpaceX maintains this revenue multiplier, then this single deal boosts SpaceX's valuation by 94 x 11 billion = $1 trillion dollars. Google owns…

> and makes 50 billion

assuming google sells, the stock tanks, nobody wants to buy next year

is this masterful? more like a scam

Re: Google to pay SpaceX $920M a month for compute capacity at xAI data centers

#335

Post by cperciva »

tristanj wrote: post #205

This is a masterful piece of financial engineering by Google and SpaceX. Google purchased 10% of SpaceX over a decade ago. After dilution they probably own around 5%. SpaceX is valued at a whopping 94x revenue. This deal increases SpaceX's revenue by $11 billion per year. If SpaceX maintains this revenue multiplier, then this single deal boosts SpaceX's valuation by 94 x 11 billion = $1 trillion dollars. Google owns…

Now with this incredible deal, SpaceX is now GAAP profitable under the existing rules, and they get to join the index next year without a rule change.

Didn't they also run up against a "minimum free float" rule?

Re: Google to pay SpaceX $920M a month for compute capacity at xAI data centers

#336

Post by rootusrootus »

runako wrote: post #281

Since the S-1 filing, xAI has taken over and is likely the largest share of revenue. I would estimate that ~95%+ of xAI revenue, and 100% of its profit, is from renting their datacenters. This is a datacenter REIT bolted onto a social media company bolted onto launch business bolted onto a niche ISP. The expected price to sales is ~100x. The best datacenter REITs trade at ~10x and pay a dividend, which SpaceX does no…

TSLA has a forward PE of ~200x. That is probably the most logical comparison with SpaceX. Proof that the market can stay irrational for quite a long time.

It fills me with a bit of dread about the future of the market. I am 10 years out from retirement, have a bit over 1M sitting in that market, and I wonder if it will implode in the meantime. I am fairly committed to the "invest like a dead man" (i.e. index funds, no touch), but the world we live in today makes me have real doubts that the next few decades will look anything like the last few.

Re: Google to pay SpaceX $920M a month for compute capacity at xAI data centers

#337

Post by Alive-in-2025 »

benl wrote: post #322
zdragnar wrote: post #307

Earlier quoted context omitted.

As an ignoramus to these things.... there are only just so many Googles though. Having made a significant jump, are they really expected to continue that growth?

The bet is that demand for AI tokens will continue to grow exponentially. And that SpaceX will be able to deploy and rent out GPUs to serve those tokens faster than anyone else. The wrinkle is that they are planning to deploy those GPUs in space. That’s what people are most skeptical about, I think!

Space data centers need years of time to design, build, and deploy, 5-10 at least, and that's after they solve their multiple very difficult or impossible problems. How will they cool them? There are just simple ideas like giant structures to radiate the heat away, but you say you need to put lots of mass in orbit?

Like fsd, will take decades to figure things out.

Re: Google to pay SpaceX $920M a month for compute capacity at xAI data centers

#338

Post by WarOnPrivacy »

dawnerd wrote: post #325
dgellow wrote: post #237

Earlier quoted context omitted.

That would require regulators to actually pay attention, something they haven’t done actively since a long, long time

First step would be to prevent the regulators from profiting to begin with.

In my experience, if we don't (meaningfully) root out corruption and ineptitude, we will continue to be governed+leveraged by one/both.

Re: Google to pay SpaceX $920M a month for compute capacity at xAI data centers

#339

Post by rootusrootus »

brianwawok wrote: post #90
rootusrootus wrote: post #51

Earlier quoted context omitted.

Tesla drivers, at least for a few minutes each day before hitting the limit.

I am a Tesla driver and I never knew it had a limit, which tells you how much I use it.

A surprising number of people have conversations with Grok every day and hit the limit in a hurry. Not my thing, either.

Re: Google to pay SpaceX $920M a month for compute capacity at xAI data centers

#340

Post by Alive-in-2025 »

hellojimbo wrote: post #329
comboy wrote: post #162

Google renting infra from xAI, I did not see that coming. My understanding of what computers are doing, what companies are doing and what governments are doing seems to be getting worse day by day.

I thought elon hates demis

Demis? Democrats or something else?

Elon likes money and power.

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