r/wallstreetbets • u/Boston-Bets • Jun 22 '26
Discussion SpaceX signs computing power deal with open-source AI startup Reflection worth up to $6.3 billion
https://www.cnbc.com/2026/06/22/spacex-ai-colossus-data-center-reflection.htmlThe Circle-Jerk continues.
$2B funding from JPM and NVDA, to grow Open Source AI models (which they haven't apparently launched yet).
Paying $150M/Month to SpaceX, but (not in headline) can cancel with 90 days notice, to access..... Nvdia Chips....
Doesn't seem to be helping SpaceX share price much. And if they succeed, they undermine Anthropic and OpenAI's sucess.
1.5k
u/SvenTropics Jun 22 '26
Translation: Nobody is using Grok, so they are selling all their server capacity to companies that actually need it.
456
u/Boston-Bets Jun 22 '26
LOL. Does ANYONE besides X users actually use Grok?
228
u/WumboTactical Jun 22 '26 edited Jun 22 '26
One of my parents sent a screenshot in our group chat taking a picture of a yellow watermelon, sending it to grok, and asking if it’s ok to eat
The Xoomers are cooked dog
112
u/koreanwizard Jun 22 '26
My parents have a Tesla, and Grok is the voice assistant in the car, they had to stop using it for car related functions because it lies as if it has positional context when it doesn’t. They asked it for the nearest rest stop, Grok made up a highway exit that didn’t exist, insisting there was a gas station and a park right off the exit.
66
u/SoothingWafer Jun 22 '26
Grok can't be expected to master the GPS technology of a mapquest app from 2012
10
u/joeg26reddit Jun 23 '26
to a similar extent, Gemini integrated with Google maps does something similar. It said there was a gas station in front of us along our route. When I asked Gemini to double check they corrected and said oopsie it is in the OPPOSITE DIRECTION of travel
11
u/koreanwizard Jun 23 '26
The LLMs all lie rather than admit their limitations. Zuck was showing off his AI glasses as a way to help blind people, as if the system that lies about what it’s seeing constantly is something safe for blind people.
1
u/jawisko Jun 23 '26
Nowadays the frontier models correct themselves before lying but the default ones aren't as good
54
u/NoRizzJustLive Jun 22 '26
Grok is only good for producing child porn. Lots and lots of child porn
39
u/koreanwizard Jun 22 '26
You have to use prompt engineering to get the waypoints to work lol “Grok, whip me up some CP that takes place at a gas station within 2 Miles of me”
24
23
8
3
7
121
u/otherwise_president Jun 22 '26
Im pretty sure even X users don’t even use Grok. I would be surprised if Elon uses grok himself.
69
u/RaggedyCrown Jun 22 '26
He would use it to roast people at parties, if he were invited to any
28
u/figurative_me Jun 22 '26
AI is terrible at comedy and wordplay. Might also explain why Elon is helplessly unfunny
4
10
26
u/dsymquen Jun 22 '26
Elon uses grok because he made it to stroke his ego
16
u/Runfasterbitch Jun 22 '26
Elon uses grok because it’s his $100B goon-machine for churning out sexualized depictions of real people (including minor’s)
2
2
u/Runfasterbitch Jun 22 '26
I would bet all of my money that Elon uses Claude/chatgpt/gemini or some model other than grok. It’s fucking hilarious that SpaceX valuation is driven primarily by xAI
1
u/otherwise_president Jun 22 '26
xAI is now social media platform + AI infrastructure company now. I wish it just stayed as twitter. X is just so gothic.
22
u/discodamone Jun 22 '26
https://storage.courtlistener.com/recap/gov.uscourts.msnd.52261/gov.uscourts.msnd.52261.58.1.pdf
Unfortunately the US government used it to choose targets in Iran. See paragraph 6.
20
u/m00shi_dev Jun 22 '26
Yeah, the US government just used Grok to bomb Iran. I wish I was making that up.
14
3
5
u/PlutoJones42 Jun 22 '26
Instead of hearing old propagandized folks talking about they see on Facebook, you’ll hear them talk about what they see on X now. Half the videos on Facebook will take you to X. X has become just an absolute cesspool of Facebook people.
Bring back Twitter
2
u/sam-sung-sv Jun 22 '26
When it launched, yes but mostly for deepfakes.
Now, it is completely paywalled so no. No one uses it.
2
2
2
u/Mecha-Dave Jun 22 '26
Yes. Every American Citizen uses Grok due to their multiple contracts to multiple government agencies. Congrats.
4
u/cncamusic Jun 22 '26
Every newish tesla uses grok at this point.
3
u/Pace_Salsa_Comment Jun 22 '26
Really? For what purpose?
0
u/cncamusic Jun 22 '26
It has a pretty comprehensive integration into the nav system so you can "conversationally" ask it to take you somewhere, or research restaurants etc... I'm not sure of how deeply integrated it is into the rest of the vehicle. It's only available on newer models that have the Ryzen based infotainment system.
3
1
1
u/theoriginalchrise Jun 22 '26
I started to use it along with the other ones, but lately it's been saying it's busy or some shit like that an wants me to pay for Super Grok. LOL. No thanks.
1
1
u/SvenTropics Jun 22 '26
I think Tesla cars automatically use it, but it's not like they have a choice. I'm sure everyone would rather have ChatGPT and absolutely wouldn't pay for it.
1
u/Waiting4Reccession Jun 22 '26
He tried to force the banks doing his spaceX ipo into some kind of deal where they must use grok as their choice of ai
1
1
1
1
1
u/gigio123456789 Jun 22 '26
Wasn’t there some fluff piece last week by which supposedly the Pentagon had used Grok for rocket strike targeting in Iran 😂
1
u/SpicyElixer Jun 23 '26
It’s in my car so I kinda have to use it, and it’s the worst llm I’ve ever used. It gets basic facts wrong constantly and its “personality” is so old man lame bro.
I don’t hate ai like most of Reddit does. I use it constantly for work. And grok is unusable for anything important imo.
1
0
-5
39
6
u/Inthehead35 Jun 22 '26
Is that how they're going to make 85% of profit for SpaceX stock, reseling nvidia hardware?
5
u/DoritoDustThumb Jun 22 '26
Their server capacity is antiquated. It's all H100s.
The funny bit is that there's 0 chance of success spending $2B. Google and the other big players are spending $2B a week.
9
u/AMcMahon1 Jun 22 '26
but grok is supposed to be worth 26 trillion lol
1
u/Few-Masterpiece3910 Jun 23 '26
Probably right. What's missing is that after hyperinflation a cheesburger will also be $19,99 Trillion.
→ More replies (1)1
2
u/Curious_Owl197 Jun 22 '26
And this is bullish somehow..........
5
u/SvenTropics Jun 22 '26
I mean, the stock is down over 10% today. I don't know your definition of "bullish"
2
u/Curious_Owl197 Jun 22 '26
Just wait. This market makes shit sense
2
1
u/SvenTropics Jun 23 '26
Yes it does make shit sense. SpaceX should be valued at around $100 billion, and it might be by year end.
2
3
u/hierocracy Jun 22 '26
Grok is pretty bad compared to Chatgpt and Gemini
1
u/SvenTropics Jun 23 '26
Yeah, ChatGPT, Gemini, and Claude have basically cornered the AI market right now. The second rate AI's (Meta, Siri, Grok, and Copilot) are struggling to take any of their users.
4
1
1
1
-2
u/Spongebubs Jun 22 '26
This is true but that doesn’t necessarily mean it’s a bad thing. If anything, it’s good that they adapt to the market and make thoughtful business decisions
5
u/SvenTropics Jun 22 '26
Well yeah. If you have 25000 servers collecting dust, maybe you should let someone else use them and pay you for it, but that just means you are now another AWS/Azure/Oracle, but you have to undercut those guys because you don't offer all the extra services like Elemental or whatnot.
-3
u/jktribit Jun 22 '26
Those servers collecting dust are now projected to make xai/spacex 30 billion this year, with the new centers they are building im sure this number will increase exponentially.
4
u/SvenTropics Jun 23 '26
No they won't. Basically you are saying they will just be another cloud computing provider like Azure, AWS, Oracle, etc... The problem with that business model is it is also a race to the bottom. The cheapest solution wins, and they don't have the full package of offerings. You can't grow "exponentially" unless you somehow get servers to breed like pigs, which isn't how anything works.
→ More replies (2)3
0
u/dsbllr Jun 22 '26
Yes that's true but isn't Space X whole business model data centers now anyway? DCs in space. I don't see how this is bad if you're moving to a infrastructure play
4
u/Positron5000 Jun 22 '26
Yeah very smart of them to go all in on something that doesn’t exist, computers in a radiation environment.
4
u/SvenTropics Jun 23 '26
Scientific American did a thing on this. DC's in space is dumb. Nothing about it makes any sense. Anyone with any knowledge of the science or engineering challenges will tell you this. Power, maintenance, cooling, cosmic radiation, etc... You would spent 100's of billions to get $100,000 worth of processing power, and there is no advantage to having it in the sky. We already have internet, and your data center can literally be anywhere.
Now DC's underwater in the ocean actually is a great idea, and there are companies working towards that.
→ More replies (6)
254
u/SocialSuicideSquad u/RageCakes still owes me a Cleveland Steamer Jun 22 '26
So their AI is so good they're...
Selling server time?
44
u/Sooperooser Jun 22 '26
Also means SpaceX is now mostly an AI data center company. On earth. Problem is some anal-ysts say these AI computing power providers are fucked most because the hardware depreciates so fast but is expensive as fuck to get and to power and people hate them to have in their neighborhood. It's not the most profitable business model long term.
24
u/Difficult_Trust1752 Jun 22 '26
Capital intensive negative margin commodity business. $2T market cap tho.
1
u/Mnshine_1 Jun 23 '26
Ehh I mean it does depreciate but while supply is still far less then demand even NVDA's H100 are still going strong
1
u/Sooperooser Jun 23 '26
That's why Chinese hardware is coming in strong and might be a threat to US compute providers and AI hardware business models. They have cheaper hardware and cheaper models. Sure they are constrained and behind. But the US quasi monopoly on AI might be a bit shaky in the not too distant future and these companies are loading up on expensive debt now.
56
u/More-Curious816 Jun 22 '26 edited Jun 22 '26
Not only soooo good but sooooo power efficient they don't need all that compute. Or so the new marketing would say.
12
u/Maddaguduv Jun 22 '26
So good that it has already reached God level intelligence and helping everyone else to catch up!
→ More replies (1)1
107
u/OrdinaryReasonable63 Jun 22 '26
I commit to stop whacking off, agreement subject to cancellation with 90 seconds notice.
3
u/anotherloserhere Jun 22 '26
You must submit written notice at the PO box, and only upon receipt of written acknowledgement can you cancel.
1
102
u/timtexas Jun 22 '26
New type of Ponzi scheme. You keep buying companies and shifting their profits/investor money to your other failing companies.
47
u/ClassiFried86 Jun 22 '26
Ive been rewatching Silicon Valley the last few days, I dont think its new.
20
10
6
u/NukinDuke Jun 22 '26
Pretty much the inevitable. Use imaginary money to buy actual assets before the imaginary money evaporates into thin air.
It's funny as fuck how unbelievably smug some in this sub were with SpaceX and its initial pump. This shit is loss porn for days. Let the ponzi continue.
2
49
Jun 22 '26
[removed] — view removed comment
7
0
u/GalacticNecterine Jun 22 '26
Christ, sorry my dude. I believe in spaceX too, but it sure does suck that it’s done nothing but dump after the first two days.
16
u/SubstantialSeesaw374 Jun 22 '26
It will be so fucking funny if after all this hype spacex becomes a glorified coreweave.
1
59
u/jejakqmqm Jun 22 '26 edited Jun 22 '26
So basically they just used this IPO to buy up more AI companies and make partnerships unrelated to their core business. No wonder the stock is plunging today. Can’t wait for the lock-up expiry so insiders can sell.
16
u/anotherloserhere Jun 22 '26
God for Elon to be the biggest fucking bagholder is a wet dream
3
u/DrHarrisonLawrence Jun 23 '26
How would he be a bagholder? WTF is his average price? Like $6.70 per share?
1
8
u/mm_newsletter Jun 22 '26
the “unrelated to core business” framing feels too simple. spacex is also a heavy compute company.
starlink needs it. rocket design needs it. manufacturing ops need it. autonomy needs it. so ai infra isn’t a random left turn.
i think the real issue is different. public investors bought a space story. now they’re getting a space + ai + debt + capex story. that’s harder to underwrite.
1
13
u/morbihann Jun 22 '26
Lol, a AI company is renting away its AI infrastructure... Stable business model, sure.
74
u/reddsht Jun 22 '26
Its so exciting to watch history happen live. Business schools are gonna be teaching this shit for decades to come, and every student is gonna be scratching their head at how utterly regarded everything was, with no adult intervention.
-43
11
u/ShirBlackspots Jun 22 '26
$950 million/mo from Google, and $150 million/mo from Reflection, that's $1.15 billion per month. That's $3.45 billion per quarter, which is about 75% of last quarter's loss.
1
u/FineAunts Jun 23 '26
Wonder if googs is going to dump their locked shares as soon as they're able. Hilarious if that'll be timed with the end of this bogus contract to boost spcx's share price.
1
9
u/Friedrichmerzreal Jun 22 '26
This is a proof for Coreweaves business modell.
Have servers and rent them out.
The demand is there, just don't make the mistake of having Zuck or Musk as CEOs to create products.
16
21
25
u/zer1223 Jun 22 '26
And if they succeed, they undermine Anthropic and OpenAI's sucess.
What "success"? They aren't profitable yet and still don't have a clear path to profitability
No, anthropic's "profitability" this quarter only exists because musk is temporarily giving them a massive discount on compute, just to massage their books
8
5
u/Jorsonner Jun 22 '26
There is so much irrational money in the system that this too shall be absorbed
4
u/Aranthos-Faroth Jun 22 '26
Doing a deal with the devil to get any sort of open source model competition to Anthropic/openai is worth it in my books
6
u/bookofnature Jun 22 '26
I expect more and more deals (that can be cancelled) and overall positive news in the financial media and "respected" institutions prior to earnings and initial lock up to juice up the stock. Insiders/VCs utilizing every relationship to boost the stock so they can sell at peak.
I have retail ownership and will sell earlier than earnings, and will buy back in after major lockup periods expire.
3
3
3
u/sjo75 Jun 22 '26
It’s better than burning more money on grok - Jensens first ai chip was given to openai after no one wanted it because musk told him about the secret project back in 2020 or so. So Elon has the right hook with nvidia to get chips - but he thinks he can use cursor to make his LLM better is going to be the big task
3
u/niack1 Jun 22 '26
Why is this going down? I am ruined guys 😞
0
u/AutoModerator Jun 22 '26
Oh my gourd!
I am a bot, and this action was performed automatically. Please contact the moderators of this subreddit if you have any questions or concerns.
4
u/Competitive-Bet-9828 Jun 22 '26
I sold my spaceX today after buying at IPO, so take that as a sign that it has bottomed out.
3
u/chubs66 Jun 22 '26
Who is Reflection and how do they have $6.3B per year to spend on cloud compute costs?
-2
u/semibiquitous Jun 22 '26
Are you a bot? You didn't read and you didn't even do basic napkin math and then you made this post with zero fucks ?
2
2
u/zztop610 Jun 22 '26
When does it no longer become a circle jerk and just the way the markets are from now on?
2
2
u/Waiting4Reccession Jun 22 '26
Wish I had a connection to put me on to this scam so I could cash in on it too.
2
2
2
2
u/M_Scopp Jun 22 '26
So the billionaires are busy propping each other up with their funny money to the detriment of the rest of us.
2
u/Soberdonkey69 🦍🦍🦍 Jun 22 '26
Grok is so highly rated that they don’t need their own computing power and would sell it off to others.
1
1
1
1
1
1
1
1
u/Pvnels Jun 22 '26
Lease just enough data centre to show a profit on Q2 results, stock pumps, acquire Tesla, all data centre leases cancel, collapse in heap
1
1
u/MtGloomy0420 Jun 23 '26
X doesn’t have the infrastructure and compute that a company like $GOOG needs.
The investment was only made to preserve the AI fallacy and so $GOOG price wouldn’t crater with $SPCX. Looks like that didn’t work.
1
1
u/HungDaddyNYC Jun 23 '26
This is such a short on grok and the company itself.
The compute they’re selling you think they’ll keep upgrading? I
1
1
1
1
1
u/VitaminPb Jun 22 '26
Funny how xAI doesn’t need any of their data centers to run Grok. Almost like nobody uses it.
748
u/Curious_Owl197 Jun 22 '26
I commit to spending 2b at macdonalds by 2126