A potential multibillion-dollar Defense Department contract could bolster SpaceX’s AI ambitions and its $1.6 trillion valuation.
SpaceX is in discussions with the Department of Defense for a multibillion-dollar contract to provide cloud computing for AI models. The deal would allow the Pentagon to utilize SpaceX’s data centers, aligning with similar agreements the company has secured with Alphabet and Anthropic.
The talks follow SpaceX’s acquisition of xAI in February, which combined Elon Musk’s ventures under a $1.6 trillion valuation. The contract could validate SpaceX’s heavy investment in AI and position it among top cloud providers supporting defense AI operations.
While terms remain unconfirmed and the deal is not finalized, the potential agreement underscores SpaceX’s strategic shift toward AI-driven growth. The company’s prior focus on rocket launches and Starlink now includes scaling xAI’s capabilities with expanded capital.