'Infrastructure Of The Future': $75B SpaceX IPO To Fuel Data Center Expansion On Land And In Orbit
While SpaceX founder Elon Musk’s long-term goal is to make Mars a new real estate frontier, the company’s record-breaking initial public offering Friday had more implications for data centers, both terrestrial and in Earth’s orbit.
The company raised $75B with the IPO, giving it a valuation of around $1.7T. This massive influx of funds could allow SpaceX to further expand its sprawling nationwide real estate portfolio. Musk also aims to revolutionize the data center sector.
SpaceX’s operations are currently carried out across 12 major properties in six states, CoStar News reported: Texas, California, Washington, Florida, Tennessee and Mississippi.
While the company started in a small Los Angeles County warehouse in 2002 and still runs its artificial intelligence arm called xAI out of Silicon Valley, Musk has set his sights on Texas.
SpaceX relocated its headquarters from California to Starbase, a small town on the Mexican border near South Padre Island, in 2024 — three years after Musk’s electric car company, Tesla, made a similar move to Texas.
Starbase is a hub for manufacturing SpaceX rockets, which are then launched from two bases in Florida or a third in California. But much of the equipment powering its highly profitable Starlink satellite internet business comes from a 363K SF facility in the Seattle suburb of Redmond.
Starlink generated $11.4B of revenue last year and $7.2B in adjusted profits, while xAI lost nearly $6.4B. SpaceX earlier this year acquired xAI, which also owns social media platform X.
Much of SpaceX’s AI data center infrastructure is located in the suburbs of Memphis, spanning from Tennessee into adjacent parts of Mississippi. Power and land availability drew the company to the region.
It is building some of the country's largest data center projects, but the expansion hasn't gone without a hitch. A data center facility in Southaven, Mississippi, fielded a lawsuit from the NAACP alleging that it includes more than 27 unpermitted gas turbines. The proliferation of data centers has increasingly drawn the ire of communities across the country in recent months.
Meanwhile, SpaceX has been working to expand its data center footprint beyond the planet.
The company earlier this year applied to launch 1 million solar-powered satellites into low Earth orbit that would serve as data centers with AI computing power. It claims that they would be more energy efficient than terrestrial data centers.
Last month, The Wall Street Journal reported that the company was in talks with Google on a deal in which SpaceX rockets would carry the other firm's data center units into space.
Musk has described the idea of putting AI data centers in space as a “no-brainer” and has said the IPO would help fund his orbital data center plans.
It does have competition on that frontier: Blue Origin, led by Amazon founder Jeff Bezos, has also applied to launch data center satellites into low Earth orbit.
The technology remains unproven, and even SpaceX acknowledged in its IPO filing that “the harsh and unpredictable environment of space” presents a significant risk for its business.
That hasn’t stopped Musk from shooting beyond Earth’s orbit. The filing also mentions Mars more than 60 times.
“We believe that space represents the largest economic frontier in human history,” the document says.
“Our innovations and technological advancements are redefining industries on Earth, while we aim to create new ones on the Moon, Mars, and beyond,” the company added. “We are truly building the infrastructure of the future.”
