Google has signed a deal to pay SpaceX $920 million per month for AI compute capacity housed in xAI’s data centers. The 32-month agreement runs from October 2026 through June 2029 and gives Google access to roughly 110,000 Nvidia GPUs. It is SpaceX’s second major infrastructure deal ahead of its planned IPO this week.
According to a regulatory filing published Friday, Google will use the GPU capacity alongside central processors, memory, and other components held in SpaceX’s data centers. Capacity ramps up through September at a reduced fee before the full $920 million monthly rate takes effect. Should SpaceX fail to deliver the committed GPU count by September 30, Google can terminate the agreement outright or accept fewer GPUs at a proportionally lower fee. In a broader sense, the deal is fairly uncommittal. A notice 90 days in advance of termination from either side is also enough to break the money flow.
A Google Cloud spokesperson described the deal as a tactical move. Google signed the 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.” Google introduced Gemini Enterprise, aimed at large business subscribers, in October last year. The company revised its capital expenditure forecast in April to between $180 billion and $190 billion for this year, and this past week announced plans to raise $85 billion in fresh stock.
SpaceX’s second big infrastructure deal
The Google agreement follows a similar arrangement SpaceX reached with Anthropic last month. This gave the AI startup access to the full capacity of the Colossus 1 data center in Memphis, Tennessee, where xAI previously secured a large cluster of Nvidia GPUs. Together, analysts project SpaceX’s data center revenue could rival proceeds from Starlink and its launch services in coming years.
Both deals come ahead of SpaceX’s IPO expected next week, which is targeting a valuation of over $1.75 trillion. The company’s first-quarter results show a level of urgency around the planned IPO. The AI segment posted an operating loss of $2.5 billion on only $818 million in revenue, while total capital expenditure hit $10.1 billion, more than double a year earlier, with $7.7 billion committed to AI infrastructure.
xAI’s turbulent road to monetization
SpaceX merged with xAI in February. The transaction valued the combined entity at $1.25 trillion. Since then, Musk has been working to generate returns on heavy data center investment. The path has not been smooth: xAI saw several co-founders depart, and in March Musk said Grok needed to be rebuilt. SpaceX also entered a potential $60 billion deal to acquire AI coding tool Cursor, with the aim of strengthening its position in the AI market before the IPO.
“We believe our compute infrastructure and related strategy provides us with substantial flexibility in how we allocate and monetize capacity,” SpaceX stated in its IPO prospectus.