SpaceX signs multi-year cloud deal with Google ahead of planned IPO

SpaceX has entered into a multi-year cloud services agreement with Alphabet's Google, locking in computing capacity.

The decision came as Elon Musk's leading-owned space venture prepares for its highly anticipated ‌U.S. stock market debut next week.

The compute capacity provided includes about 110,000 Nvidia GPUs, CPUs, memory, and other related components.

As part of the deal, Google will pay SpaceX $920 million monthly from October this year to June 2029, with capacity ramping up through September at a reduced fee, Elon Musk's space venture said in a regulatory filing.

The pact brings another high-profile customer to SpaceX, after Anthropic, strengthening its AI narrative as it targets a $75 billion raise in its upcoming initial public offering.

Anthropic said in May it had reached a deal to use the full computing power of SpaceX's Colossus 1 facility in Memphis, Tennessee, which houses more than 220,000 Nvidia processors and will give the Claude chatbot maker 300 megawatts of new capacity within a month.

On an ‌annual basis, SpaceX's compute access deals with Anthropic and Google are worth roughly $26 billion combined.

SpaceX's compute deals with Anthropic and Google tower over last year's revenue. 

As reported by Reuters, SpaceX's disclosed compute-capacity agreements with Anthropic and Google are worth more than $70 billion in aggregate, assuming neither contract is terminated before its scheduled end date.

Notably, after December 31, either party may terminate the agreement by providing 90 days' notice.

If SpaceX does not provide access to the agreed number of GPUs by September 30, then, after a one-month grace period, "Google may immediately terminate the agreement or accept the number of GPUs provided, with a corresponding pro-rata reduction in the monthly fees," the company said.

Additionally, Google will retain ownership of all intellectual property rights in its content, AI models, and associated data.