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Ahead of SpaceX IPO, SpaceX and Google announce $920 million/month GPU rental agreement

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westrock2000

[H]F Junkie
Joined
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Messages
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SpaceX added an addendum last week to their IPO prospectus documents announcing an agreement they have entered into with Google to rent to Google the usage of 110,000 video cards at a staggering $920 million per month. If you haven't gotten your calculators out yet, that comes out to $8300 a month per card. The agreement provides multiple outs for Google though. Sounds like good PR on the the heels of the IPO this week, but doesn't require either side to lock in to a permanent commitment. But it also shows the outrageous monetary value that these Datacenters have attached to them.

On June 5, 2026, we entered into a Cloud Service Agreement with Google LLC ("Google") with respect to access to
compute capacity. The compute capacity provided includes approximately 110,000 NVIDIA GPUs, CPUs, memory,
and other related components. Pursuant to the agreement, the customer has agreed to pay us $920 million per month
from October 2026 through June 2029, with capacity ramping up through September at a reduced fee. If we fail to
deliver access to the committed amount of GPUs by September 30, 2026, then following a one-month grace period,
Google may immediately terminate the agreement or accept the number of GPUs provided, with a corresponding pro-rata
reduction in the monthly fees. After December 31, 2026, the agreement may be terminated by either party upon
90 days' notice. The customer will retain ownership of, and intellectual property rights in, its content, AI models,
and related data.
 
google + Anthropic if they keep renting for a whole year would do so at a 26 billions a year cost, that would fully pay colossus 1 and 2 construction in a single year.........

Imagine if they still are paying that in H2 2027.... for GPU we were told would be worthless after 2 years (while people try to secure access 3 years in advance)
 
So now the problem of building datacenter-getting power to those gpu is made up, google has not such problem, they are just pumping their SpaceX share by spending a lot of money ?

(90 days windows is not that special here, Anthropic achieved to get a 90 days one after the first 6 months, google in 2027... virutally the same), TPU can get better than Nvidia, Rubin can have issues, SpaceX own need can explode, what market pricing will look like in 2028 who knows..., flexibility make sense in that fast moving world.
 
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LukeTbk said:
So now the problem of building datacenter-getting power to those gpu is made up, google has not such problem, they are just pumping their SpaceX share by spending a lot of money ?
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Pump and dump, perhaps? The whole AI thing seems like a tech bro circle at this point and the cracker is getting really freakin’ big…
 
Randall Stephens said:
Pump and dump, perhaps? The whole AI thing seems like a tech bro circle at this point and the cracker is getting really freakin’ big…
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I really doubt they will sales their shares, but if they do the fastest they could break the contract would be 90 days after 2027 start, they would still have paid 5.5-6 billions or something, financing what are competitors (SpaceX and Nvidia) in the process.

A lot is possible, but it can simply be becoming compute starve like everyone and SpaceX ability to be the only one doing that actual 1 gigawatt compound in colossus 2 filled with gpu that run give them quite the opporturnity to sell it at high price, that fact that it would not be that costly with the balance sheet of SpaceX anyway just making that an easier pill to swalow.
 
Randall Stephens said:
Pump and dump, perhaps? The whole AI thing seems like a tech bro circle at this point and the cracker is getting really freakin’ big…
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Yeah. Why isn't the gummiint investigating this? Where is the Securities and Exchanges Commission? Oh, I forgot that it is 2026.:eek::eek:
 
no wonder the stock market has been going down the past few days...everyone is selling and getting ready to buy the new SpaceX stock when it becomes available this Friday
 
This seems highly illegal. It has to be illegal right? lol

This is like selling an apartment block and trying to bump the price by saying look look all my friends are renting units at 100x their value. So me charging you 50x more then the market value is totally a fantastic deal for you right? Do they have a lease, oh no no I trust em its a month to month handshake sort a thing.

There is no way Google is paying over 8k per month to rent any GPU. This is complete BS.
 
SpaceX...today is the day it starts trading on the NYSE...can Elon Musk do it again?
 
ChadD said:
This seems highly illegal. It has to be illegal right? lol

This is like selling an apartment block and trying to bump the price by saying look look all my friends are renting units at 100x their value. So me charging you 50x more then the market value is totally a fantastic deal for you right? Do they have a lease, oh no no I trust em its a month to month handshake sort a thing.

There is no way Google is paying over 8k per month to rent any GPU. This is complete BS.
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Seem to be market rate if we look at the Anthropic deal, $11.75 gpu an hour is more than Anthropic deal of $7.80, but they get blackwell right away and rubin faster than Anthropic. But that probably the market rate, google rent less of them and b200, while a lot of anthropic are old H100.

Those rate are all inclusive, you do not pay just to rent a gpu, you pay for access to a giant connected together cluster and the capacity to power it.

YOu can find higher than $12 an hour per gpu for system if you do not bulk-buy capacity like they do:
https://getdeploying.com/gpus/nvidia-gb200
 
I am moving everything into high dividend etfs/funds at this point because they're priced correctly imo.

If these future projections are right, those companies will be the beneficiaries and they're not priced for those forward gains making them a discount right now. If these future projections miss, everyone will lose but with drip i get more growth in the down cycle. If it's in the middle, I avoided some risk. And honestly, if you're within 15 years of retiring these market swings should all be warning bells in terms of risk.

(and im already up 26% for the year, so jfc)
 
A man who earned $28 an hour at SpaceX is about to become a millionaire today because of the IPO...but he is just 1 of 4,400 SpaceX employees becoming millionaires today...they are engineers, welders, machinists, and launch technicians who took equity over cash and held it for years

Juan Hernandez moved from Mexico and learned to weld for the money...he joined SpaceX in 2015 earning $28 an hour. When he went full time, the company gave him $10,000 worth of stock...he held it, bought more through payroll deductions, and sold a small portion in 2020 to buy property in Texas...his remaining shares are worth $880,000 today...

https://x.com/BullTheoryio/status/2065411151106830667
 
wonder if there was still a little bit of underpricing to have a good first day press that went on here..... despite the level of not wanting to reward the big banks too much effort.
 
SpaceX is the perfect short term stock...I don't think it'll hold up in the long term but it's great to buy and sell in a week or 2
 
Seem extremelly risky to buy this for short term right now.... how much more than 2.25 trillion could it be worth in a week or 2 ?
 
LukeTbk said:
Seem extremelly risky to buy this for short term right now.... how much more than 2.25 trillion could it be worth in a week or 2 ?
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it already went up from $135 to $170 today...I can see it possibly hitting around ~185 before it starts to trail off...maybe $200 on the high end
 
polonyc2 said:
it already went up from $135 to $170 today...I can see it possibly hitting around ~185 before it starts to trail off...maybe $200 on the high end
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And i can see it going back down to the initial 1.75 trillion....

1325.jpg
, really unsure how does one evaluate the next 2 weeks direction for a stock.... 20 years play around a believe of SpaceX with an xAI, Optimus-Tesla synergy that make it relatively safe floor wise with nice 10 trillion upside, I get how does one start to evaluate free cash flow in that future, 4th of july value of a stock relative to today.... seem pure betting.
 
Aurelius said:
The IPO was bad enough, but the buying frenzy just makes it worse. SpaceX isn't worth this right now... and Musk certainly shouldn't be a trillionaire. This is the kind of excess that led to revolts in centuries past.
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second part is a bit strange, people that do this:
space-flight-chart.jpg


Getting some for of asset value of what they did to do it (and not for consumption, virtually 99% as a tool to put more money in the endavor), seem a nice incentive to have more of it in the future and a case of pure win (spaceX employee and financier that took the risk)-win (humanity), who lose what outside the very expensive old player and their rent seeking that lost business ?
 
LukeTbk said:
And i can see it going back down to the initial 1.75 trillion....

how does one evaluate the next 2 weeks direction for a stock.... 20 years play around a believe of SpaceX with an xAI, Optimus-Tesla synergy that make it relatively safe floor wise with nice 10 trillion upside, I get how does one start to evaluate free cash flow in that future, 4th of july value of a stock relative to today.... seem pure betting.
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of course it's pure betting...that's what the stock market is...no one knows how any stock is going to perform over a period of time...otherwise everyone would be millionaires...all I know is what I want to do with my $$$...I bought SpaceX today when it was $156.73...I already made a profit...I own many stocks and usually hold them for years and years but with SpaceX I'm going to play the short game

plus I think SpaceX is going to merge with Tesla relatively soon and I already own 150 shares of Tesla
 
LukeTbk said:
And i can see it going back down to the initial 1.75 trillion....

View attachment 808769, really unsure how does one evaluate the next 2 weeks direction for a stock.... 20 years play around a believe of SpaceX with an xAI, Optimus-Tesla synergy that make it relatively safe floor wise with nice 10 trillion upside, I get how does one start to evaluate free cash flow in that future, 4th of july value of a stock relative to today.... seem pure betting.
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It still hasn't been added to the multiple indexes it will be fast tracked to - NASDAQ/RUSSELL and some others - which means ETFs that track each will have to buy it too etc
 
polonyc2 said:
of course it's pure betting...that's what the stock market is...no one knows how any stock is going to perform over a period of time...
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it is probability of course, but you do not need to care how the stock would do to want it, you can want it to go as low as it can forever and just mean you end up buying the whole company if you have the chance for it to go to zero.

It is not pure betting because of how closely value follow performance, which as predictability to it.

Here I am curious what the thinking was, when Deepseek create a very strange media cycle and had Nvidia-AMD-Broadcom-Arm, etc... go cheap, I though it was a rare opportunity, very often the media do not know what they are talking about and that was an extreme case, usually the market does not move as it is way more sophiscated, in this case so many were waiting for an excuse to rebalance with so much unrealized gain and concentration happening that they did, bought a lot of those has the market was making an obvious error to me, that deepseek would have anything negative impact wise to amd or nvidia and others... when it was a pure 100% good news for them. I do consider this an informed bet more than a pure bet if you will. (the way some in the media-market talked they seem to think that writting a bit of ptx instead of just CUDA made it less Nvidia-moat robust.... as if ptx was not Nvidia proprietary and not still going through the incredible nvidia JIT compiler after, they relied even more on it and was even more for Nvidia alone as a process)

Any reason why space X would go to 2.5 trillion ? just how IPO fomo often play ? or people realizing tesla synergy was greater than expected ?


kram182 said:
It still hasn't been added to the multiple indexes it will be fast tracked to - NASDAQ/RUSSELL and some others - which means ETFs that track each will have to buy it too etc
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WIth not many share, could see this creating pressure up... could have been already priced in too in today big push.
 
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LukeTbk said:
WIth not many share, could see this creating pressure up... could have been already priced in too in today big push.
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Some buying today by hedgies etc with anticipation of that but still probably gonna bump up when it happens - just as if you look at when Tesla was being added to the indexes, and funds that tracked them were gonna be forced to buy it too - people were buying it up in anticipation of that for weeks before running it up and it still popped when officially added
 
Aurelius said:
The IPO was bad enough, but the buying frenzy just makes it worse. SpaceX isn't worth this right now... and Musk certainly shouldn't be a trillionaire. This is the kind of excess that led to revolts in centuries past.
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Nikola Tesla and Leonardo Davinci type characters don’t come around very often.
 
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