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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

#821

Post by webninja »

bwfan123 wrote: post #309
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…

Circular financing at its finest. And Self-dealing between the hyperscalers, openai, and anthropic. google invests in anthropic and spacex - and shows appreciated values as earnings. Then it turns around and rents tpus to anthropic to show it as revenues. The main buyers and sellers for all of this are the hyperscalers, openai and anthropic. It is a game of musical chairs while the party is still on.

I think the measurable term for this is “Velocity of Money”.

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

#822

Post by markhahn »

nl wrote: post #762
ozgrakkurt wrote: post #690

Earlier quoted context omitted.

That example is a bit extreme but I can give two more normal examples. Google/Nvidia and Apple/Nvidia. I don't think there is a world where nvidia will make more money than google or apple or keep making more money than them. Also another one is Tesla. In my opinion, there is absolutely no world where tesla is worth the current stock price if you compare it to chineese companies or some company like Toyota. Ofc at th…

It might pay you to look at the numbers. Last quarter: Goog: $109B revenue, $62B in profit. NVIDIA: $81B revenue, $58B in profit. NVIDIA is growing faster. I agree about Telsa though.

how about this: there has been a fairly short-lived, one-time event that boosted NV's revenue and allowed them extraordinary margins. nothing like that is goosing Goog or AAPL.

yes, I'm claiming that the NV-AI hype bubble will pop (which almost everyone expects to one degree or other).

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

#823

Post by sipjca »

chiph wrote: post #695

Google has code written for their Tensor processors (TPU). Will it run on the NVidia GPUs that xAI has? Because I'm thinking they're "not part of their core architecture" and it will thus be money wasted. (I thought for sure the title was backwards - it's a strange world)

inference code is effectively trivial to port at this time

everyone understands cuda well enough anyway

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

#824

Post by l23k4 »

trhway wrote: post #709
l23k4 wrote: post #534

Earlier quoted context omitted.

>I don’t think you have either? I don't know how I could? The indices have already provided their reasoning for these rule changes, but that's just summarily rejected by the conspiracy-minded. To laymen this appears to be a grand conspiracy. Rules are being changed to accommodate big companies, that's usually bad. To people in the financial industry, it's fait accompli. The indices exist to reflect the market, these…

the explanation what i heard from some financial analytics is that small float with large valuation would create a dog pile/short squeeze type situation among the funds trying to reflect the SpaceX valuation vs. the whole index valuation - 1.8T vs 70T ratio would be 50B of float vs. 2T where is total of index funds is much larger than 2T, and that is even without accounting for retail investors and other, non-index f…

>of course, they've engineered a new way of making even more money. The pile of passive money in ver low expenses index funds obviously have been a fat target for them.

Are you planning to substantiate this conspiracy theory in any way?

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

#825

Post by oezi »

gorgonian wrote: post #768
davedx wrote: post #484

Earlier quoted context omitted.

Start gradually converting your equity to bonds is the standard advice on that timeframe. If you're dreading equity drawdowns, that's what fixed income is for.

As others have pointed out, bonds are barely (or not) keeping up with inflation. I would like to suggest a third alternative to stock index and bonds: stable dividend stocks. They should increase in value along with inflation but still pay out a steady dividend as long as the company is strong.

With the big caveat that strong dividend yields can be an indicator that the market is considering the company to do poorly in the future.

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

#826

Post by oezi »

mafuy wrote: post #814
throwaway2037 wrote: post #784

Earlier quoted context omitted.

For those unaware (myself included), VT is the Vanguard Total World Stock Index Fund ETF which "tracks the FTSE Global All Cap Index, covering roughly 9,000 stocks across more than 40 developed and emerging markets." I see this argument a lot online: "You need more diversity." First, you didn't provide any reason or evidence about why this is a good idea. Second, "more diversity" isn't always better. The S&P 500 has…

I do not understand how you can talk about US, EU and Japan but not mention China. Because I'd bet China is in a similar league and has better prospects than any of the three.

China's equities aren't really tradable. If they were it would be nice.

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

#827

Post by nl »

markhahn wrote: post #822
nl wrote: post #762

Earlier quoted context omitted.

It might pay you to look at the numbers. Last quarter: Goog: $109B revenue, $62B in profit. NVIDIA: $81B revenue, $58B in profit. NVIDIA is growing faster. I agree about Telsa though.

how about this: there has been a fairly short-lived, one-time event that boosted NV's revenue and allowed them extraordinary margins. nothing like that is goosing Goog or AAPL. yes, I'm claiming that the NV-AI hype bubble will pop (which almost everyone expects to one degree or other).

In the long term all is dust.

NVIDIA has at least 2 years of solid revenue growth ahead of it.

Beyond that people are dreaming about doing predictions anyway.

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

#829

Post by bottlepalm »

theturtletalks wrote: post #287
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…

Do companies like Uber, Tesla, etc ever intend to pay dividends? If a stock never intends to pay dividends, the value of the stock is simply the price the next shumck is willing to pay.

Not really, the company reinvests the dividends, increasing the value of the company/stock.

The big difference is you pay taxes of dividends - you don't pay taxes on the stock going up year over year. Unrealized gains compound much faster than realized ones.

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

#830

Post by tristanj »

clusmore wrote: post #797
tristanj wrote: post #692

Earlier quoted context omitted.

The contract has an exit clause, either side can terminate the agreement with 90 days notice. I do not expect this contract to last the full 3-year term. And this deal protects Google's investment. Google owns close to $100 billion of SpaceX stock. This deal increases SpaceX's revenue by 30%, and pushes SpaceX into profitability. With this deal, SpaceX is eligible for S&P inclusion. Assuming $6-7 trillion in S&P 500…

I think your point still stands, but a correction that 1% of $6-7T is $60-70B, not $600-700B.

My mistake, I'm running on a lack of sleep.
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