SpaceX | xAI bets $16.8B on Terafab chip plant and a new mobile network
SpaceX | xAI and Tesla announced a joint $16.8 billion investment in Terafab, a semiconductor and AI compute megafactory aimed at easing global chip and compute shortages. Separately, SpaceX | xAI revealed plans to build a terrestrial mobile network to compete directly with major US carriers.
The twin moves push SpaceX | xAI well beyond launch and satellite connectivity. Terafab would feed the company's AI data centres, including the Starmind orbital project tied to Nvidia hardware, while the mobile network would layer new ground infrastructure onto its existing Starlink footprint.
Management expects SpaceX | xAI to consume about 75% of Terafab's output, deepening its operational ties with Tesla through shared hardware and compute.
The plans build on an existing push into AI compute and connectivity. Q2 2026 results showed $7.8 billion in sales and a net loss of $541 million, alongside heavy AI capex and new shelf registrations for additional Class A stock.
Together, launch, satellites, AI data centres, chip supply, and mobile service point to SpaceX | xAI assembling a full-stack business.
That broad scope raises both potential revenue drivers and execution risk. Investors will watch whether the first Texas phase of Terafab breaks ground within the next few quarters and how much of the AI roadmap depends on the site.
For the mobile network, the tests are early spectrum access agreements, pilot markets, and any partnerships with carriers or cable operators.
The announcements show how central AI infrastructure and connectivity have become to SpaceX | xAI's strategy. Shares sit at $133.11 after a 22.8% weekly gain, though they remain down 12.5% over the month and 17.3% year to date — underlining how quickly sentiment around the company can shift.
Read more: Simply Wall St
Image credit: IBM Research
