Shares of global chipmakers are swinging on remarks by Elon Musk, chief executive of both Tesla and SpaceX. Less than a week after Musk said a memory supply glut could arrive sooner than expected, he went on to demonstrate unprecedented growth in SpaceX's demand for artificial intelligence computing. The market now rises and falls on a single comment from Musk.
In a post on X, formerly Twitter, on the 14th, Musk publicly took aim at what he described as contrasting attitudes among memory suppliers over future prices. In the post, which drew more than 2.8 million views, he wrote that Micron had been reasonable about future memory prices while other companies had been "extortionate." Given the oligopolistic structure of the global memory market, the criticism effectively targeted Samsung Electronics (005930.KS) and SK hynix (000660.KS).
What stands out is the intensity of the language Musk chose. He went beyond simply complaining that prices were high, using "extortionate," a word that carries the sense of exploiting a counterpart's weakness to extract an unfair price. He went further, saying it was something today's customers would never forget. That amounted to a declaration that he would drive prices down without mercy once the current memory shortage ends and the market shifts in favor of buyers.
Musk also argued that the onset of a memory glut could be moved up, citing China's push into semiconductors. In a separate post, he wrote that China would produce enormous volumes of RAM in 2028. The remark reflects his view that the manufacturing capability China has demonstrated in batteries and solar power will also show itself in the chip industry.
It was Musk, too, who single-handedly revived chip sentiment that had turned cold. SpaceX's third-quarter earnings call, held on the 20th, showed that chip demand remains solid. Third-quarter revenue surged 161% from a year earlier to $14.58 billion, or about 19 trillion won, far above the average market estimate of $12.7 billion.
The strong results came not from space but from the AI business. Third-quarter revenue in the AI segment soared 830% from a year earlier to $7.56 billion. It overtook revenue from the communications segment, including Starlink, at $5.248 billion, becoming the company's largest source of revenue for the first time. The gain reflected the acquisition of AI coding startup Cursor along with external cloud service contracts.
On the earnings call that followed, Musk responded to a question from a Goldman Sachs analyst by saying that every hyperscaler and dozens of smaller companies were persistently asking to rent more computing, and that had SpaceX supplied all of them, it could have leased its current capacity several times over. He added that when the company tries to shift some inference workloads to outside clouds so it can devote more computers to training its own AI, it is told there is no spare capacity in Nvidia's GB300 or GB200, nor in Google's TPUs or Amazon's Trainium, and that even older H100 chips that might still be sitting overseas ultimately cannot be obtained. Older chips as well as the latest ones are all in operation, he said.
Given those conditions, SpaceX says it leases computing resources to outside users on short-term contracts priced off the spot market rather than through long-term deals. Musk explained that as AI software and models improve, the useful intelligence per watt rises and the value of computing increases as well. He said older machines such as the H100 are in some cases being leased at higher prices than when they were new, and that short-term contracts are being renewed not at lower prices but at higher dollar-per-watt rates.
The passage that drew the most attention concerned the payback period on investment. SpaceX said it can recoup spending on new computing facilities within a year. Musk went further, saying he does not expect a demand problem and stressing that the possibility cannot be ruled out that the payback period on computing investment shortens to six months in 2027. The market has recently taken a negative view of the AI theme, pointing to deteriorating cash flow from Big Tech's heavy capital spending, but the outlook offered from the field was of a different tenor.
On that point, SpaceX Chief Financial Officer Bret Johnsen said visibility into contracts for computing resources over the next six months had improved, and guided first-quarter revenue for the company as a whole to $33 billion to $37 billion, more than 50% above Wall Street's average estimate of $22 billion. SpaceX has set a target of expanding its AI computing capacity, currently about 1.7 gigawatts, to more than 13 gigawatts by the end of next year.
For now, the direction of share prices at Samsung Electronics, SK hynix and Micron is unclear. What is certain is that Musk's remarks are having a considerable effect on sentiment. Observers say a single post on his X account could continue to send the stocks sharply up or down.
Subscribe to "Kim Ki-hyuk's Tesla World" for an accessible look at the future of the electric vehicle, robotics, AI, autonomous driving and energy industries that Tesla and Elon Musk are pursuing, with direct commentary on the latest news that is hard to find in foreign or domestic coverage.