SpaceX plans to launch its first Nvidia-powered AI satellites by the fourth quarter of 2027, moving up a timeline it previously set for 2028. The company is deepening a chip partnership with Nvidia amid cost estimates for orbital data centers and multibillion-dollar capital spending plans.
SpaceX aims to launch its first Starmind AI1 satellites by the fourth quarter of 2027 and significantly scale in the following year, CEO Elon Musk said Monday. That timeline moves up plans SpaceX had laid out in its prospectus, which targeted deployment in 2028.
A deepened Nvidia partnership
The companies unveiled their deepened relationship last month, when Musk revealed SpaceX would exclusively use Nvidia chips going forward. Musk said of the space-optimized system SpaceX designed with Nvidia: "Our design is significantly simpler, lower cost, denser and lighter than a traditional rack."
Proponents of space-based data centers argue the approach lets companies avoid regulatory red tape and community backlash. Critics counter that Earth-based data centers will still be far cheaper to run for several years or more.
The cost of computing in orbit
Wood Mackenzie estimates that a one-gigawatt orbital data center would cost $170 billion, more than triple the cost of a traditional data center. Those costs are expected to fall over time as rocket launches also get cheaper, something SpaceX is working on with its Starship vehicle.
SpaceX also plans to expand the AI infrastructure powering its Grok chatbot using Nvidia's Vera Rubin platform, according to Nvidia. Musk told investors earlier this month that SpaceX will receive a very significant percentage of Nvidia's graphics processing units in 2027.
Scaling compute and spending
SpaceX plans to end 2026 with more than two gigawatts of AI computing power and reach closer to 10 gigawatts than five gigawatts by the end of next year, Musk said. The company already runs data centers in Tennessee and Mississippi and is reportedly planning at least one new data center in Texas.
The company also plans to produce its AI satellites in Bastrop, Texas, and is working with Tesla on a chipmaking project in the state. The companies plan to spend at least $16.8 billion on the initial stage of their Terafab project in Grimes County.
Morgan Stanley analyst Adam Jonas expects SpaceX to book about $53 billion in AI-related capital expenditures in 2026. He expects another $130 billion in 2027. Jonas rates SpaceX's stock a buy with a $300 price target.
Nvidia is due to report fiscal second-quarter earnings Wednesday after the bell, a release that could move markets broadly. Nvidia shares were down about 3% on Monday. SpaceX's stock was off around 1.7% the same day.
Source: MarketWatch
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