[00:01] Launch is foundational to everything you do. >> Absolutely. >> You um are 10 years ahead of the world in reusability, but Starship is designed for rapid reusability and dramatically more mass to orbit um at a much lower cost. So, can you just talk about launch, how important it is, and then Starship in the context of that? >> Yeah. Yeah. I think launch it it start if you're going to be a space company you know I tell people it's hard to be a space company and not have assured access to space and so we started out
[00:33] making sure that we had launch nailed down and Elon really focused on driving down you know the cost of access to space at a far you know uh far cheaper uh price than anyone had ever even thought of before. you know, we're we're now, you know, lowest cost per kilogram to space ever in the industry and we're looking for Starship to do another 10x improvement as we get uh to rapid reusability with Starship. So, it is definitely at the core of what we do and it's the enablement for all of the other
[01:04] businesses, whether it's, you know, Starlink or um direct to sell very soon or or now AI compute. Uh and and so I think you absolutely have to start when you talk about SpaceX by talking about our launch capabilities and Starship will be to your point next level because what we're doing now is taking on this huge I would say like the holy grail of rocketry which is rapid reusability. You know it uh it's one thing to bring back the first stage which is amazing right and and transforming the industry but we
[01:36] did that 10 years ago with Falcon. What we're doing now is we're flying the largest rocket ever built with the goal of it getting to aircraftlike operations. And that is a completely different dynamic. But I think that's what it will take to be that catalyst for the whole space industry related to kind of turning the the 2030s into something that we had expected when we were kids. Uh related to the space industry. >> Where in the Starship program are we? We just had a launch. It was, you know, a V3 of the ship and the booster. Um, it
[02:08] felt like I will admit it felt kind of like a we were both there. It felt like a high-risk um high-risisk event heading into an IPO, but it but from my perspective and as far as I can tell from the SpaceX team, it seemed very successful. So, what did we learn? Where are we with Starship? And where are we on that path to rapid reusability? >> I I think our first launch of E3 that you're referring to from just last week uh was a huge success for us. you know, the the fact that we were able to demonstrate the full system capability,
[02:38] uh the new V3 uh Raptor engines, the uh all of the changes that you saw on the bottom of the vehicle, all the operational changes that we did as well, and then you saw that soft splashdown at the end of the second stage. Um I think gives us a lot of conviction about where we're going, not just, you know, in years to come, but really even in the next next couple of flights. Uh and that's that's really exciting because that is as we were talking about that platform or catalyst for the rest of the business. You know, having a rocket that
[03:09] uh that can take a hundred metric tons to to low Earth orbit is going to be uh hugely important for for everything we're about to go do. >> And that's 100 metric tons at at what cost relative to Falcon at what cost? Well, I I think, you know, as soon as we can bring back that second stage to the tower and start rapidly reusing it, um in the next uh we'll just say in the next couple of years, uh I think you're going to experience a 10x from uh from a cost per kilogram uh to space from where we're at with Falcon today. Uh and so
[03:40] that is I think a huge springboard for multiple pieces of our business. I think of launch as enabling a variety of applications for SpaceX as a company and you know if kind of you know Microsoft they had the operating system and enabled a lot of applications launch is foundational and the first and the biggest and most well-known application is Starlink and your connectivity business and can you just give us a sense of the scale of that business the
[04:10] growth of that business? Yeah, it uh it's very exciting because we actually haven't been in the connectivity business for that long when you think about it. You know, really having our first production satellites in space back six years ago and ramping that business to where we're at today with over 10 million customers and and over 10,000 satellites that we have now flown to space um and 160 plus countries around the world. uh it is clear that we're delivering a capability that the world really wants and I think that you
[04:41] know it it just gives you so much conviction when you know you're delivering a great product and we've had so many notes in in fact we would send we send out an email each each month with you know how many communities around the world we've had a positive impact in it's it's really special whether it's you know um indigenous tribes in in Canada or or down in Brazil where we're connecting you know schools are in in Africa where they haven't had any connectivity before. Bringing something like Starlink to the world has been pretty amazing. And so, you know,
[05:12] what it's done is it's given us an extension of the mission we were talking about. First and foremost, we want to make mankind multilanetary. But above and beyond that, now having the ability to connect the other three billion people on the planet and really bridge that digital divide has been really special for folks. And uh, you know, I think that really resonates. But yes, I agree. Starlink was that first piece of the business. And I think that that that 10 million customers can become hundreds of millions of customers around the
[05:42] world in time. Um because of the fact that, you know, it's so much more efficient to deliver to so many different locations from space than it is terrestrially. And uh and so we're just heading down that path right now. Uh and we're incredibly vertically integrated related to it. So I think you know we end up being a little bit of the the blockers now become our own capabilities which is great. That's exactly the way we want it. Um but what Starlink also was was it was I would say that catalyst for the Falcon business to
[06:13] really ramp up operationally because you know if you don't have payloads kind of lining up then you don't really have a reason to go from 10 launches to 22. We launched 165 times last year with our Falcon vehicles. And what we would do is and do is we bring multiple stacks of Starlink, you know, uh, satellites to the launch site such that when there's an opening between, uh, launches of third party satellites, we can then, okay, we're going to take that slot for Starlink. And so now, as you go into our
[06:45] next phase with Starship, I think we have another catalyst like that. And above and beyond Starlink now, we're going to have AI compute satellites. >> Absolutely, 100%. And I'm super excited to talk about AI compute, but I do think it is um Starlink. I'd love to just double click there because I am a former telecom analyst, so it is it is near and dear to my heart. >> Yes. >> And just some observations that come to mind for me. One, people have forgotten how big the telecom markets are. I just
[07:15] call it round numbers. 800 billion for kind of, you know, internet access, 800 billion for, you know, cellular connectivity. So 1.6 6 trillion market plus or minus I'm you know to within the nearest 200 billion and what really strikes me as a student of the telecom industry is there's never actually been a differentiated or disruptive product in telecom before because everybody has access to the same towers
[07:47] broadly speaking the same rights away and the same equipment the products end up being very similar and this was this was true for local telefanity. It was true for long distance. It's true for true for cellular. I am a very serious video gamer. I'm not very good, but I play uh I play video games the way a lot of my peers um you know play golf. >> You're my boss. >> Um but I am, you know, I'm like I take it very seriously. >> Yeah. >> And um my grandfather used to say that
[08:18] age and treachery will always triumph triumph over youth and skill. And in video game terms, that means having the best GPU and the best connectivity. >> Sure. >> At every location I've been to, Starlink is better. It is faster and it is lower latency. And I think latency is a very important point for the user experience. So can you just talk about how this product differentiation is going to help you go from 10 million to 100 million to hundreds of millions? Yeah, I I think
[08:49] you know uh it's pretty funny because it's for sure we'll talk about broadband in a minute but but especially if you think about the directto device that we're going to ramp right our next generation of direct to cell or direct to device will be 5G quality right in the next two years we're about to bring something that's pretty you know unique to to say the least and something I think anyone would want which is to go anywhere with your phone have global roaming be out in the middle of the desert on the highest highest mountain and not have dead zones. I mean, these
[09:21] are pretty special things that I think people would want and probably pay extra for, but it especially if it's the same price. So, I think we are very excited about bringing a very differentiated product to the market. Again, it feels great when you're bringing a product I think that's great for everybody. It's also going to be great for disaster recovery and when you know there are emergencies, the fact that the network doesn't go down and you don't have to worry about the tower being out. Um but but circling back on the broadband side, you know, the the fact that you can deliver low latency to your point, I
[09:53] think that's really critical. Low latency, high-speed capability really everywhere, uh you know, other than the countries that I'm not allowed to go into, um you know, is is something that just won't make sense terrestrially. And so I think it will become harder and harder to justify many of the deployments on a terrestrial perspective because Starlink now exists. And uh I I I do think that uh you know people really now are starting to see even on aircraft right when you start to see all
[10:23] the announcements United Airlines now American Airlines uh you know just just announced and and and some many of the others without listing many over and over again um you know getting on an airplane and having that type of low latency high-speed experience uh really kind of opens people's eyes to what it could be at their own homes or uh offices as well. Awesome. And I do think I'm glad you brought up the disaster. What Starling what SpaceX does anytime there's a natural disaster. >> Yeah. >> It has undoubtedly saved lives. Surging
[10:54] Starlinks for free, turning them on. This has saved lives. >> Yes. >> So outside of Starlink and orbital compute, which absolutely merits its own discussion, what are the other applications enabled by Starship or businesses? What are you most excited about? >> Well, I I do think on the connectivity side, those two businesses will ramp nicely. And what's also great about those is I think when people think about space, they think about the new markets
[11:24] that we will create in the years to come, which I agree with that. Whether it's point-to-point transportation on Earth and 30 minutes flying to Singapore kind of thing or or whether it's the lunar economy, I think all of those will happen. But what I think people discount is there are massive to your point almost $2 trillion of existing markets just on connectivity that are existing markets today to us really and so the fact that you're able to deliver a better product in an existing earth market before even talking about space
[11:55] is probably what gets missed some of the time. >> And it's not just a better product. You do have a cost advantage. >> Yes. >> Just it's it's just Yes. >> You're not digging ditches, right? You're not digging ditches. You're not spending all that huge amount of upfront cost. You really send the terminal out once you've established your network of satellites. You send the terminal out and that's basically most of your customer acquisition cost. >> Yeah. >> Better, faster, cheaper has been a winning experience. >> Good combo in in in my time as a as a
[12:26] tech investor. But any one or two of those markets, whether it's freight, whether it's point-to-point travel, >> I think the next big one though is going to be AI compute. >> Okay. >> You know, and so uh we should definitely spend some more time on that. But but I think that is a market that really needs Starship >> to really happen. Oh yeah. >> Because it's there are large payloads and you really are focused on cost. And so I I think that's the one that's kind of near and dear for us cuz you you already see those next two happening,
[12:57] right? And uh this will just be a significant enhancement. If I think about what Starship's going to do for our broadband satellites, our V3 satellites that we're about to fly in the coming months here on Starship, you know, every Starship launch of those satellites brings 20 times the capability of what we're flying with a Falcon launch today. So it is a huge enablement for our broadband business and soon to to bring 5G capability on the direct to sell. >> So Starship rapid reusability they really enable this much larger Starlink
[13:28] constellation that takes us from 10 million to the hundreds of millions. They actually lower the cost of of Starlink further by lowering the launch cost. Um and they enable uh this exciting new and and they well they'll enable uh direct to cell which is awesome but they will enable orbital compute and I would love to just people hear data centers in space >> and after lots of interactions on X I've realized that a lot of people are picturing like a pentagodized building floating around in space and that is not
[14:00] what it is. Oh, >> it is or orbital compute is racks in space and like let's just let's start there like um you know I'm sure there's going to be images available to people but just describe what one of these satellites is going to look like so people can conceptualize it. >> Yeah, I I love the racks in space. I I might I might steal that from you. I I think that's that's the right way to think about this. I actually had the same issue when someone said data centers in space internally the first time. I thought, "Oh, wait. How are we going to connect all these pieces
[14:31] together?" And they're like, "Johnson, this is literally like another constellation." Oh, okay. But but really, you know, you then realize virtual networking has been, you know, obviously a key component of networking for a number of years now. And this is that same concept of virtually networking rack by rack to your point of satellites that look just basically like larger versions of the Starlink V3 satellite we're about to fly for broadband a lot more solar and now
[15:01] compute over the top related to you know we'll just start with Nvidia you know GPUs on there and a large you know kind of sheet of metal from a radiative cooling capability perspective but otherwise you know looks largely the same as uh as what we're flying from a comm's perspective, although we've pulled the comm's payloads off obviously, but really I I feel like I people think that this is a a completely new concept for us and it's not. It's a a kind of a logical extension of the
[15:32] satellite technology that we're already using today with all the connectivity down, you know, to Earth with the the inner satellite links connecting the different uh satellites together, the prop systems. I mean, there's so much of what we're already doing with Starlink today that we immediately get to benefit from on these. And I think when people see the picture of one satellite versus another satellite, they kind of aha moment kicks in of, oh, well, these guys are going to be able to do this very quickly. >> Absolutely. Yeah. So, and just just, you
[16:02] know, just maybe help anyone listening conceptualize a rack, an Nvidia rack, the um the NVL72 rack. >> Yeah. >> A server is like, I don't know, a couple of pizza boxes. Um, and then you stack those servers together. You make a rack eight feet high, three feet wide, maybe four or five feet deep. And that rack is going to be at the center of the satellite. It may not have those exact dimensions. It may have more or less than 72 GPUs depending where the engineers land, but we're going to have that rack. We've got solar wings. I
[16:34] tried to eyeball it. It looked like they were two or 300 feet long, maybe maybe 150 feet long out to each side. And then it's in a suns synchronous orbit and the radiator extends behind it so it's always in the shade and cold. And so let's talk about what that design enables, what advantages that enables from a first principles perspective from orbital compute, around power, around cooling, around cost, around latency back to Earth. >> Yeah, it's funny. So I agree on all four
[17:04] and the one that I think maybe start with is regulatory, right? the fact that people are already having concerns about I don't want this data center in my backyard, you know, is is clearly a trend uh a little bit concerning trend. And so the fact that we can bring a clean energy, you know, good for for everybody type solution by just sending these up and and being powered entirely off the power of the sun is pretty amazing. uh the fact that the solar
[17:34] cells are in space and get roughly five times if not more uh energy per cell than they get terrestrially because they don't have to deal with going through the Earth's atmosphere and they're in sun sync where the sun is on those cells 24 hours a day. And the fact that you can make them cheaper because you don't need the protection, the glass protection on these cells because there's no, you know, environmental issues when you're up in in vacuum. You know, you start to see these first principles kicking in on the power significantly. And from a cooling
[18:06] perspective, you know, which is one of the more challenging things already to deal with on the terrestrial side. If you walk in one of our data centers, you know, all that liquid cooling and all the plumbing that we've had to do and really en you know, um engineering around that to to really figure out innovatively how to do that becomes very, you know, straightforward radiative cooling simpling simply kind of extending the radiative cooling solutions that we're doing with Starlink and now doing it with AI compute and then obviously no no land lease, right,
[18:37] to deal with and so really it then becomes your cost is your satellite right and your launch and you know I look at it at being a tech person because I was semiconductors before before space you know you kind of have those cost curves traditionally that you would have right and as you ramp up in volume in time you know your costs go down and you're benefiting from Moors law or maybe soon a different type of Morris law but but you know if you look at the satellite most of the cost is silicon right and and so we're ramping up factories and we're benefiting from silicon you know cost reductions process
[19:08] node to process node so our costs are going to go down over the few years. If you look at the terrestrial solutions, the curve is going the other direction, right? Everything's getting more expensive, right? The way that you're the way you're doing the cooling, power bills are not going down, and uh you know, landregatory is getting more and more challenging. And so I think this just all lends to better for the population uh and a trajectory to be significantly better from a cost perspective as well. >> Awesome. And how how do you think like
[19:40] the you know this this market compute um is one of the largest markets in the world today. >> How do you think about the size of that market when you will enter it and we'll talk about terrestrial compute but when you will enter kind of like begin to have orbital compute working and and you know maybe maybe a range you know this is yeah this is really hard stuff. >> Yes it is. In fact, my engineers, they've they've heard me explain where it's, you know, kind of a logical
[20:10] transition and we've done most of the pieces of this already. They say, "You got to just you got to make sure people understand there's a lot of work still to do." I said, "I understand that." You know, I think and some of that is actually scaling this, you know, scaling to the numbers that we're talking about such that you can put up gigawatts a year into space is a very hard challenge. And we have just been able to demonstrate scale whether it's launch scale or whether it's flying and building ourselves thousands of satellites a year. And that is
[20:40] definitely going to be one of the challenges here again that uh you know that we deal with here. But but certainly you know we're going to be able to demonstrate capabilities as soon as next year. And so uh you know I it is near uh and I think the ones that say we believe like if you list kind of the the people that are supporting you know orbital compute solutions at this point it's basically a who's who of the of the tech AI industry. I won't list other people's names, but certainly Elon Musk being on the top of that list, right? Um
[21:12] but but I think they think that it's a lot further away because you can't do it without launch, right? Without the rapid reusable launch that that Starship is going to provide. >> I I will I will ask Grock a question. Grock being SpaceX's AI, general purpose AI. I'll ask Grock a question. The inferred will happen on an orbital compute satellite and come down via Starlink direct to cell to my cell phone >> and it will be amazing. >> What a moment will I and and whe
[21:44] whenever it happens. >> Yeah. >> Like that that I I will personally find that very exciting. >> I completely agree with you. Yes. Um and then can we just kind of like conceptualize the scale of this because I think you know people megawws gigawatts you know um like I think there's one there's there's maybe a few now but there's only a few gigawatt scale data centers um here on on planet earth
[22:15] today. >> I know you one of them you operate one of them. We've been to it together. Um but like give us the sense of the scale of a gigawatt data center and how much power that is relative to the um you know I think a single Blackwell rack consumes the power of a 100 American homes and we're putting in a gigawatt scale data center you know hundreds of these racks together and stitching them together. So just what does it mean
[22:46] gigawatts of orbital compute per year? And I don't think uh I don't think your boss is going to be satisfied at gigawatts. >> He is not uh nor am I. And and I think that's why you see us spending so much time to get Starship to rapid reuse. Uh right now with the existing first iteration of our satellite in our V3 uh version of Starship we just flew, it's roughly 200 launches for every gigawatt that we put up. And I would just emphasize that's first gen of the
[23:17] satellite and the rocket. And so we are just starting down this path. But even at that point, we're capacitizing for thousands of launches a year right now. And uh you know, you see the two, you know, launch towers and pads uh in in South Texas. You see the first one almost done at Cape Canaveral and the second one on its way with launch complex 37 within the next year. And so those first four towers alone, you know, kind of give you that that initial path. And we've got other locations that we're
[23:48] starting to talk about too. And so I think that is critical to start down the path of having that capacitization um as the rocket itself starts to ramp. >> Awesome. I would love to talk before we talk about your AI business. Jensen said, >> "Yeah, >> that bringing Colossus One, which was the largest coherent cluster of hoppers in the world, >> um online in 122 days, and these are Jensen's words, was superhuman and that
[24:18] he he thought only Elon could have could have done it." >> Um Elon and you know, the talented team team that works with him >> and I just I would just love to hear from you. What is it like working for Elon? And how does um Elon being so involved in the engineering plus this incredible sense of mission play into the talent of the company? Why? Why? Why could XAI now part of SpaceX
[24:49] do something like I I I vividly remember, you know, a lot of people thought it was it was impossible and that it couldn't be done and it wasn't being exaggerated. And I think it wasn't until Jinset said that that people believed it had been done because it seemed so impossible. So, just just talk about working for Elon and the talent >> Yeah. I mean, I've got 15 years working for him. Uh it is it's always special. Uh it's one of the reasons I'm still here to be honest with you. Uh he creates a culture where you know like
[25:21] like uh like we talked about where you know you set out with these what initially look like audacious goals and then step by step you realize that you're marching towards something that is absolutely achievable. um you know uh the schedules themselves we you know are are sometimes challenging to make uh u you know as far as the initial schedule but but what's amazing is he he does everything that he sets out to do and I think that's the key here is you know in
[25:53] fact if I think about you know um going to Mars for example when I first got here in 2011 15 years ago uh people would be kind of like rolling their eyes when we talk about Mars you know and being a multilan planetary species nowadays when we say that literally the response is what year you know it's no longer doesn't even sound audacious and I think what Elon's I think done a masterful job on is uh along with probably a lot of other things is setting out these targets and then
[26:24] creating a fantastic business model around each piece of IP that you need for that end goal. You know, I it it reminded me of when back when I was at Broadcom, we would go in and we would want to do a new SOC and if we were missing pieces of IP, we would do an acquisition, right? And you grab those pieces in because you wanted to win the next socket at wherever Apple or something. And here, you know, if we need the next piece of IP, we're doing it organically for sure, but it was we got to get to orbit, then we need reusable rockets, then we need heavy
[26:54] lift with Falcon Heavy and now Starship. We want man carriage, right? So now Dragon and now Starship. Uh and then we need comms in space. And so you kind of go step by step by step. And then you need rapid reusable launch. And once you have that, you get to the point if you're flying thousands of times a year when a Mars window opens, you have a fleet of vehicles that you're ready to launch to for that month or so. And then you're back to your operational cadence again, right? Because it's every two
[27:24] years. and you didn't really have to have a crazy investment to make that capability happen anymore. And now it's, hey, let's get the lunar economy going. Let's learn what it is to live, you know, in space knowing that we're going to want those capabilities, you know, for the the moon and then Mars as well. And so I think that that kind of step at a time has uh kind of removed any concerns that people initially had of how are you going to raise all this money for something and you know what's the business model around multilanetary
[27:54] you know species in in uh you know and now people don't worry about that and and so we all get to stay here focused on the mission and yet the business model itself is pretty amazing and I think you start to see that same dynamic happening with AI where we're going to leverage this cap capability. It's going to ramp up our launch capability along the way. I think it's going to absolutely give us an extension to our mission related to bringing, you know, the the human consciousness off planet,
[28:24] right? And preserving that consciousness in space and yet it's, you know, a great business model for us step by step >> just, you know, doubleclicking on on the talent and the engineering environment that Elon creates. >> Yeah. that that goes into making each one of these pieces of the business, you know, IP around it. But, you know, each element of Starship, each element of Starlink is kind of, you know, to me there there's many many interesting
[28:54] pieces of engineering, >> but like what I always think about and just in terms of, you know, just kind of making sure everyone understands the culture of SpaceX is, you know, my understanding is Elon works on whatever's in the critical path, whatever the hardest problem is directly with the engineers. He does. So we have a mission make humanity multilanetary. We have other AI missions that we'll we'll talk about. So this is really exciting. We get the world's best engineers. And then my observation is I think an underappreciated part of what Elon does is to me if I talk to any
[29:26] engineer, one of their favorite times in life was that like college engineering course where they had were assigned on a team and they had to build like a remote control drone or a race car and they worked all night and it feels to me like that is what Elon creates for these exceptional engineers that are brought in by the by the um mission. And just, you know, I I don't I I don't know what um you you would know better than me, but I I believe at one point the Raptor engine was like the critical
[29:57] gating factor, >> and there was a standing meeting every late Sunday or Monday night, >> and it just had to be the engineers who are working on the Raptor engine, and maybe they're just 24 years old, but they're there in a small room working on that problem. Can you just talk about that environment? I mean, I think we've seen that type of dynamic, you know, a handful of times for sure. Uh, and you're exactly right. I think what's amazing to me is that he is in there in
[30:28] the details working with the engineers on these critical issues. And it's it's also, you know, in incredibly inspiring to know that your leader is in the trenches with you and working probably harder than any employee that I know. And I don't know how he keeps that energy level up for the, you know, length of time, the decades literally that he's been able to do it. It's pretty amazing. Um, but but I absolutely would tell you I've witnessed, you know, those technical challenges or technical
[30:58] um discussions over the challenges that we face on a regular basis. Raptor engine was one of them for sure, but but there have been many others along the way. And he's going toe-to-toe with with the, you know, the technical leaders on those items. And it's just incredibly inspiring. >> And now we have that that uh photographic evolution from Raptor 1 to Raptor 3. And now, you know, seems like all the Raptors did great on the latest Starship. >> They did. It was pretty amazing. >> Yeah. But so if the first mission that SpaceX started with was um make humanity
[31:31] multilanetary, I think it now has other missions. Yeah. >> Because you acquired XAI, whose mission was maximally truth seeeking AI. XAI had X which is dedicated to free speech and I think these are these missions resonate with people and then maybe these all come together and and and you said I've heard expanding the light cone of consciousness bringing the light of consciousness to the stars. >> This is kind of the overarching mission now that ties them all together. So, I
[32:01] would just love um I would love to hear from you, Brett, how you think about the AI business and then, you know, we'll we'll riff on some of it. >> Yeah. No, listen, I I appreciate it. I I think that uh you know, going into the AI business has a couple of different, you know, incredibly rewarding elements. Certainly, there's a financial opportunity and there's the opportunity to to give us the reason to really ramp up to thousands of launches from a financial perspective, but I think it's also critical that we have the ability
[32:32] to make sure that, you know, the AI model that people start to really rely upon is a truth-seeking model. And so having the, you know, the content, the real live content from X, um, you know, integrated into our solution, I think is is is important to us and I think will, you know, in the end be a huge differentiator related to our AI solutions. >> Awesome. Well, let's let's talk about the business. And, you know, the first part of the business that I think is probably most accessible to people is Grock.
[33:02] >> We've got Grock. We have an enterprise API business. We now have Grock Build. Yep. um you know which puts a harness around it. We have terrestrial um compute here on Earth. Um and like let's just let's walk through each of them. >> Well, you know, it's it's it's probably not a surprise that we have a very diversified AI business because we've done the same thing with our other businesses. You know, if I think back to our space business, the fact that we launch, you know, uh commercial missions
[33:32] and and space force missions and NASA missions, you know, uh really gives us diversification. And then you look at connectivity with broadband and direct to cell and the fact within broadband, we didn't even talk about enterprise and government, but that's certainly a big piece of our our broadband business as well. And so now you talk about AI and again a very diversified business. Um certainly you know hosting others uh was a you know a key um item that we talked about related to event you know in the next couple of years with orbital
[34:02] compute but there's nothing better to prove out that uh that business model than demonstrating it right now with the uh enthropic deal that we announced. We can do that right now with our terrestrial data centers. So certainly hosting um others as well as building our own model both enterprise and consumer to your point um certainly on the consumer side the differentiation of our you know real time data from X is huge by the way even X uh I think we can do far better related to the you know optimization of the ads engine we're
[34:32] investing in that technology right now um and you saw us not be happy with where we were at on the enterprise solution on the coding specifically quickly and so we went out and uh you know did the deal with cursor uh and and brought in you know one of the industryleading solutions even on that front to move us faster and bring in all of that enterprise data. So I I think in all of those areas you know you're seeing huge strides already. Um but what I also love is that it's now SpaceX AI.
[35:05] You know if you go up there at Palo Alto you know it is SpaceX and you feel it already. you're seeing the impact of that bringing you know our DNA um and and integrating the two companies as fast as possible has been really special and uh I think you're you're just in the early days of seeing what we're going to do in AI. >> Yeah, I mean just factually the rate of product releases has accelerated significantly. I I do want to kind of double click on this anthropic deal >> and with the anthropic deal that you
[35:35] that has been signed and reported on, >> you're at a $3.75 billion run rate >> per quarter. So you are 50% larger than the company that I think of as being, you know, just outside that the top four. And so you you have a top five AI infrastructure business by my math. And you know, that's just that's my napkin math. But can you just talk about that deal, what that was like and and
[36:07] how many more deals like that there could be and how quickly we could bring on terrestrial compute now that we have confidence there's offtake. >> Yeah. I I I think that just there's there's nothing better than just demonstrating the capability uh even before we get to space that you know we feel like we're bringing a solution to the AI industry that's desperately needed. Uh I think Elon was very vocal even you know a year ago that he felt like the constraint was going to be compute and power and you're already seeing that. Um and what we have is we
[36:40] have these dense training clusters which makes it really premium compute that we're able to offer folks as well. But I don't want to also give people the sense that that means we're backing off related to our own internal solutions. We're absolutely not. Um but the fact that we can keep our model and our solutions training and doing inference on you know the the bleeding edge related to GB300s in this particular case um and really monetize you know the the other uh compute in our um you know
[37:12] in our terrestrial data centers is huge and uh I think you're going to see us be able to do more of that um ideally with you know with more folks uh over um you know over the next whatever time period we want to give it here um even before we get to space and uh and that's really been uh you know part of the key I mean we at our core are builders right we we are strongly um you know in entrenched in in building the infrastructure of the
[37:43] future and so AI being one of those key uh industries and so I I think that uh you know you'll see likely more and more folks want to lean to us. There's just a tremendous amount of technical challenge in putting up these like to your point gigawatt scale data centers. >> So we should expect to see you guys ramp up the expansion of terrestrial data centers to support third parties who who who want to rid compute from you and for your own internal services.
[38:15] >> Well on Grock um would love to talk about that. would love to talk about what cursor uh could mean for the Grock business. And one thing that um really made an impression on me is the very significant leap and cursor's own internal model composer after just a few weeks of um mid-training reinforcement learning in the SpaceX AI Colossus 2 cluster. And
[38:47] you saw a pretty you saw just you know factually a noticeable jump in performance and it is you know on the paro frontier for um you know that that measures cost relative to kind of intelligence. So this is effectively intelligence per unit of cost. Just talk about cursor talk about gro talk about where that business could go. Well, it's it's a really great team first and foremost. Uh when we were doing the diligence and talking to uh Michael Terrell and team, uh I I think you know
[39:19] when you find a team that's a good cultural fit and uh and so uh you know once once that you know uh was identified then looking at the the data that they were able to bring to the table for us uh you know that was huge. the fact that they're working with over half the Fortune 500 and have thousands of enterprise accounts. Um, you know, it was certainly uh, you know, a huge opportunity and then for them, you know, they the to your point, they were
[39:49] starved for compute and you saw immediately what the benefit was for their tool. And so now having, you know, that cursor, you know, coding engine as well as our own Grock LLM and really the harness with Grock build that's that's coming out really right now. Um, is pretty magical. >> Awesome. And I would love to um just a few words about Terraab. >> Um, and so just just talk about Terafab and how the company's thinking about that. >> Yeah, I think Terafab is a really interesting one. being a semiconductor
[40:19] guy before we were talking about you know and certainly it's a partnership first and foremost with SpaceX and and Tesla and so now bringing in you know Intel into the fold is huge right having you know an industry leader of decades in the um you know in the semiconductor industry brings that knowhow to the table you know I look at it as if if you were starting up you know a foundry business from scratch you know it I just I think it would be so challenging to convince people to tape out their
[40:50] products to you. And so, you know, I don't even know that you could, you know, start a new company from scratch unless you had a captive customer like in this scenario like SpaceX and Tesla saying, "We will take every wafer that you can yield out." And so then it takes that risk away and then really the risk is a capital risk only. And so I I also think that there are going to be some very exciting elements of having my view the the entrepreneur innovator of our lifetime going and challenging the
[41:21] requirements in a new industry again you know and sitting with you know the process engineers that have you know 50 steps to their requirements list and you know ex pushing on each one related to why that has to exist that way and bringing everything under one roof and taking a completely different approach. I think we'll yield a pretty amazing result and Elon's been able to demonstrate that industry after industry after industry. But what I would say is we are doing this because we're very
[41:53] concerned about the supply chain constraints that might exist very soon in the next you know handful of years related to being able to fab out anywhere else. you know, if you look at it when when you start talking about Nvidia or you know, the AI5 chip or or um you know, a TPU, all of a sudden you start talking about TSMC, right? And so it isn't that you're you know, being able to diversify out from a supply chain perspective if you go one more layer down. And so our concern is is
[42:24] really more than anything else that the supply chain won't be there for us to ramp to many many gigawatts. Ideally 100 gigawatts a year is our target in the in the years to come um without being able to you know have a tariff. We we need to make sure that we have assured you know supply of silicon. >> And I would just say as an American it's awesome to have more semiconductor manufacturing in America. It's awesome to have more manufacturing jobs here in America being created by SpaceX. And you
[42:55] know I'm I'm sure you and everyone are super proud of that. But it's it's great for the country. So, so thank you. Um, may maybe last last question. SpaceX has been very capital efficient over the course um, you know, of of its of its life, but now we are we have Terrafab, Starship, orbital compute. We're going to start putting a lot more capital both into the ground and into space in the most literal way. And can you talk about
[43:26] that transition? and can you talk about, you know, how it's going to be funded? >> Yeah, I I I think that really capital allocation's been one of the bigger challenges of this job for 15 years. And what I would just say is we have a pretty good track record, right, of being able to do this. And certainly the dollars are now bigger than they have been in the past. But but I also am incredibly proud of the value creation uh along the way that we have already been able to achieve. And I think that track record, you know, also uh is
[43:57] something that people should consider when they're they're thinking about, you know, the future for us as well. But um you know, we we really take an approach, uh from a capital allocation similar to what you would do in a just in time model for manufacturing. You know, you're you're looking to capacitize Starship with different towers and air separation units for the fuel and, you know, additional hangers. And so you're looking at that. you're looking at whole new facilities for satellite builds and and solar capability and now you're
[44:28] looking at terrestrial data centers and orbital you know orbital compute all happening at the same time and so you really have to go map it out quarter by quarter and just not get ahead of yourselves related to you know when do I need that capacity in each of these businesses >> and the timing one might think there was some sound business logic and minds at work here because the timing does seem to work out really well with Starship um starting to fly Starlink V3 that enables
[45:00] you know that unlocks growth and for Star for Starlink and growth for Starlink is cash flows because it's a cash generative business that unleashes direct unlocks direct to sell which is a new business that will presumably be high margins and all that is coming online and ramping right when orbital compute when we need to start putting a lot of those racks into space. >> That's right. That's right. I wish I could take credit for that, but that's certainly Elon. You know, I just I I I
[45:30] execute on the man's incredible vision, but I agree with you. The timing is pretty magical. >> Well, Elon would say execution is everything and vision vision is a distant distant distance to execution. So, execution is important, but I also just think maybe to to kind of bring us home, but we have we have Starship launch that enables everything. We have terrestrial compute um you know gigawatt scale data centers. We have
[46:01] an AI model, we have Starlink, we have orbital compute and we have Terapab. all of these play into each other and work together. And can you just can you just talk about what that enables? Um, and just it is it's it's a lot of vertical integration. >> It is. And I think when people look at it from the outside, they think about all these kind of, you know, disperate businesses, but it's actually not that
[46:32] at all. It is the fact that we have a launch platform that was Falcon and now is about to be Falcon and Starship. that really is the enablement for every business you just listed. And so we get to just go get better and better at that core launch capability, that core, you know, DNA of being the space business, uh, you know, of the world. And each of these vertical offshoots, you know, comes to play out where you have a differentiation because of the fact you're able to deliver a better product because of it that it's coming from
[47:03] space. And you know it's different versions of satellites you know in most cases or it is back to our core of being incredibly vertically integrated in each of these core pieces of the business uh and and really bringing infrastructure you know to the the forefront in each of these >> and at every level you competitors can buy launch from SpaceX. >> Yep. >> Starlink is available to everyone. Yep. >> You're selling compute terrestrially to competitors. The model can be used by
[47:35] anyone. Absolutely. So while it's vertically integrated in orbital compute, Elon has said that com you know competitors are welcome. So while the model is vert vertically integrated, it is also open at each level for sure >> and can be accessed discreetly. And then of course if each one of these elements is a standalone business on its own that just gives you more scale, further lowers costs, plays in to the vertical integration. >> That's right. >> Yeah. >> Exciting times. Exciting times.