SpaceX's AI Spending to Fuel Nvidia's Growth

SpaceX is investing heavily in artificial intelligence (AI), with its capital expenditures on AI exceeding $15.8 billion over the past three months, more than doubling from the March quarter's $7.7 billion. This spending accounts for 86% of the company's capex last quarter.

Elon Musk praised Nvidia's top chip, the Vera Rubin architecture, stating that it is 'the best AI computer.' SpaceX has decided to build exclusively on this architecture going forward due to its superior performance and partnership with Nvidia.

SpaceX's AI revenue totaled $2.6 billion last quarter, more than tripling from $818 million just three months earlier. However, the company still incurred a loss of $1.3 billion on its AI segment during this period, making it a highly risky investment.

Nvidia is poised to benefit significantly from SpaceX's heavy investment in AI, as well as other companies' continued spending in the field. Despite its growth and profitability, Nvidia offers a more reasonable valuation compared to SpaceX, which has a market cap of around $1.9 trillion.