SpaceX spent $60 billion on artificial intelligence (AI). Can Elon Musk build the next Amazon?

In the early days of online shopping, Amazon(NASDAQ:AMZN) It was a simple website selling books. Over the next few years, the company expanded its marketplace to a more comprehensive e-commerce platform. This ultimately helped pave the way for the launch of Amazon Web Services (AWS), a cloud infrastructure platform. This series of events quietly made Amazon a critical digital infrastructure provider, boosting its market value to trillions of dollars.

Elon Musk’s space exploration technology(NASDAQ: SPCX) are following a similar path. SpaceX started with rockets that made it cheaper to send payloads into orbit, but now it also provides global internet connectivity through its Starlink business and is building massive artificial intelligence (AI) data centers.

SpaceX’s long-term goal is to create a comprehensive suite of tools that power the entire AI economy. Recent actions such as the merger with xAI and the acquisition of Cursor AI are accelerating this process.

Rockets, internet, and AI infrastructure all under one roof

SpaceX will oversee the complete sequence required to deliver all aspects of the AI ​​infrastructure value chain. The company’s rockets will be responsible for launching equipment into orbit. Starlink’s broadband satellites provide a global connectivity network that can link AI systems and end users. And on the ground, SpaceX is deploying a large cluster of servers dedicated to training AI models.

This vertical integration also extends to power and data flows. Terrestrial data centers are powered by established electrical grid and power plant infrastructure, supplemented with on-site generation as needed. The data center satellites the company aims to deploy into orbit will be powered by continuously available solar power.

SpaceX will control the rocket, connectivity layer, power approach, and accelerated computing hardware, allowing it to develop and deploy next-generation AI systems without relying on external suppliers at each stage. This strategy mirrors the strategy used by Amazon, which built its own warehouses, logistics network, and cloud platform rather than relying on outside vendors for key parts of its operations.

SpaceX is powering its AI business through key combinations

Prior to its initial public offering, SpaceX acquired xAI to bring advanced model development within the organization. Essentially, the deal will allow SpaceX engineers to design AI systems while simultaneously building the physical infrastructure to run them. The result is a closed-loop system between software and hardware that supports AI development.

The company’s recent $60 billion acquisition of Cursor further supports this effort. Cursor provides tools that help developers create and improve the software needed to design advanced computing systems.

The key here is that SpaceX is about more than reusable rockets and satellite broadband. CEO Musk is actively assembling a portfolio of end-to-end capabilities that AI hyperscalers will need in the future. Against this backdrop, SpaceX is positioning itself as a core infrastructure provider, just as AWS has become one of the key supporters of companies’ digital transformation.

SpaceX’s long-term ambitions extend beyond Earth

There are many constraints to building an AI data center on Earth. These facilities consume large amounts of electricity, straining local power grids and increasing energy costs for those around them. They occupy large tracts of land, also require extensive cooling systems, and most often suck up large amounts of fresh water. All of these resources are becoming more expensive to secure, especially given that major technology companies are planning hundreds of billions of dollars in capital investments to build out AI infrastructure.

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SpaceX is trying to eliminate some of these bottlenecks by deploying a fleet of in-orbit AI servers. In certain orbits, powerful solar power is available 24 hours a day and converted into electricity. Additionally, these satellite-based computer servers can be cooled by using large thermal panels to radiate the heat they generate into the vacuum of space as infrared radiation.

In theory, the payload capacity of SpaceX’s Starship rocket would allow it to launch large computing modules rather than individual parts, allowing for more efficient construction of these facilities. The company will then be able to use Starlink infrastructure to keep these data center satellites connected to Earth. Such an orbital ecosystem would pave the way for AI computing power to continue to grow without facing the same resource constraints that prevent expansion on the ground.

SpaceX combines a proven ability to maintain a fast rocket launch cadence, global satellite connectivity services, and a trusted approach to building AI computing beyond Earth’s limits. The company’s ambitious long-term plans for infrastructure leadership mirror the story of Amazon’s foray into cloud services, with clear implications for continued growth and strategic importance in the AI ​​economy if Musk and his company can execute on his vision.

Adam Spatacco has held positions at Alphabet, Amazon, Meta Platforms, and Microsoft. The Motley Fool has positions in and recommends Alphabet, Amazon, Meta Platforms, and Microsoft. The Motley Fool has a disclosure policy.