SpaceX has signed a multi-billion dollar deal with AI startup Reflection AI to provide the latter with computing resources. The Musk-owned company is transforming into an AI infrastructure provider.
Reflection announced on Monday that it will pay SpaceX's AI unit SpaceXAI $150 million per month from July this year until 2029. Reflection will use hardware from SpaceX’s Colossus 2 data center in Memphis, Tennessee. Each party has the right to terminate the arrangement by giving 90 days' notice to the other party.
SpaceX signed agreements with its two biggest competitors, Google and Anthropic PBC, in the weeks before it went public on Wall Street, allowing them to rent computing power from SpaceX's data centers. Google agreed to pay about $30 billion by mid-2029, while Anthropic agreed to pay $45 billion over a similar period of time, although SpaceX and both companies have the option to terminate the contracts early.
This series of transactions shows that SpaceX is vigorously advancing its leadership position in the lucrative market of selling computing power to AI companies. Although Musk has struggled to compete with rivals in AI development, his company has amassed a large inventory of chips and built several large data center facilities.
Reflection, founded by two former Google DeepMind researchers, has received support from Nvidia and other companies. The company has reportedly been in talks to raise $2.5 billion at a $25 billion valuation.
“More computing power means more room to build the world’s best open source models at scale,” a Reflection spokesperson said in a statement.