SpaceX in Talks for Multibillion Dollar Defense Contract; Implications for Investors
SpaceX is reportedly in discussions with the U.S. Department of Defense for a multi-billion-dollar computing contract that would allow the Pentagon to use SpaceX's data centers to run AI models. The deal, not yet confirmed, follows similar agreements SpaceX has with Alphabet and Anthropic. This development is significant for investors because SpaceX acquired xAI in February 2026, forming a $1.6 trillion entity. The AI segment posted a $6.4 billion operating loss in 2025, contributing to SpaceX's overall net loss of $4.9 billion. A Pentagon contract could help offset these losses and provide a durable, long-term revenue stream with high switching costs. The article notes that while the deal could validate SpaceX's AI investment, the stock is not considered a 'screaming buy' at current levels.
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