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In a development that strengthens SpaceX’s bid for an IPO, long time SpaceX backer Google has signed an agreement to use SpaceX’s data centers for computing access. The deal, where Google will pay SpaceX $920 million per month to start with, is aimed at using SpaceX’s vast computing resources, including its 110,000 GPUs and other computing infrastructure in its data center.
The reasons behind the deal
On the face of it, it might seem strange that Google, which already has its own computing infrastructure, is using SpaceX’s for computing access, but the fact remains that SpaceX has a ready-to-use data center infrastructure that cannot be ignored.
According to a statement by the company, Google has been forced to tap into SpaceX’s computing infrastructure due to massive, unexpected demand.
“This is a short-term, timely agreement to ensure we have bridge capacity to meet surging customer demand for our agent platform, Gemini Enterprise, which has been even higher than we expected.” it read.
For SpaceX, this development cannot come at a better time, as the company gets ready for its much-anticipated IPO soon.
Elon Musk had set up this computing infrastructure for his AI startup, xAI, which was then integrated into SpaceX. In March, an exodus of talent from xAI had left these computing resources underutilized, but they are now being put to good use.
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According to a Securities and Exchange Commission (SEC) filing by Google, this multi billion dollar deal is expected to commence in October 2026 and run till June 2029, valuing the deal at about $30 billion. According to the deal, SpaceX must have its entire stock of 110,000 GPUs fully up and running by September 30, and if it fails to do so, Google can terminate the contract or demand a significant discount.
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