AI rivals are thirsty for SpaceX's compute, Elon Musk says

• Elon Musk said AI rivals are clamoring to rent SpaceX's compute.
• SpaceX plans to split compute between its internal uses and outside customers.
• The company could rent out its compute "several times over if we said yes to everyone," Musk said.

SpaceX's AI rivals are clamoring to rent computing power from the artificial intelligence and rocket company, CEO Elon Musk said.

"We are also, frankly, hounded relentlessly by every hyperscaler and by dozens of smaller companies to rent more of our compute," Musk said during SpaceX's third-quarter earnings call Tuesday.

Musk said SpaceX could rent out the company's compute "several times over if we said yes to everyone."

SpaceX, however, is reserving a chunk of that capacity for its own AI ambitions, including scaling its AI chatbot Grok and Cursor, the coding startup it recently acquired.

Musk said SpaceX is seeking to devote roughly half of its compute to internal uses and rent out the other half to third parties. That balance could change month to month, he said.

"It's going to be dynamic," said Musk. "And obviously, our approach is to rent at the — effectively the spot market rate as opposed to sign these long-term deals."

The company expects the value of compute to increase as AI models improve and ultimately generate "more useful intelligence per watt," said Musk.

"And the value of that compute is proportionate to the useful intelligence per watt," Musk said, adding that rental rates for older Nvidia H100 chips have climbed from when they were new.

"I think that's likely to continue," said Musk. "I think we're going to face a shortage of super intelligence compute. And that shortage is going to remain for a long time."

Musk likened the situation to Monty Python's famed cheese shop sketch, in which a customer repeatedly asks for different cheeses only to find that none are available.

"We've actually tried to offload some of our inference compute to other cloud providers so that we can use more compute for training," the CEO said. "And we get the cheese shop sketch."