Elon Musk's SpaceX is in talks with the Pentagon to supply computing power for the U.S. military's push into artificial intelligence, according to the Wall Street Journal.
The WSJ, citing people familiar with the matter, reports that SpaceX and the Department of Defense are discussing an arrangement in which the company would give the department access to data-center capacity for running AI models. The potential deal is described as being worth up to several billion dollars.
Data centers are the warehouses of specialized computers that train and operate modern AI systems. Access to that kind of capacity has become one of the most sought-after resources in technology, and the reported talks would put SpaceX in the business of renting it out to a major government customer.
According to the WSJ, SpaceX plans to expand its cloud-computing efforts and compete more directly with established providers in the space. Reuters, reporting on July 17, relayed the same account, noting that the talks concern access to data-center capacity worth billions of dollars to run AI models.
The reporting is based on unnamed sources, and neither the terms nor a final agreement have been confirmed. It is not clear from the sources whether a deal will be reached.
Why it matters: If completed, the arrangement would deepen the financial and strategic ties between one of Musk's companies and the U.S. government while signaling SpaceX's ambition to become a serious player in the fiercely contested market for AI computing power.