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

Elon Musk made the remarks during SpaceX's earnings call. Andrew Harnik/Getty Images 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." Read next Business Insider tells the innovative stories you want to know Business Insider tells the innovative stories you want to know Business Insider tells the innovative stories you want to know Business Insider tells the innovative stories you want to know Natalie is a senior reporter on Business Insider's Business News team covering the AI and data center boom.She was previously on BI's Legal Affairs team, where she handled major cases coming out of state and federal court, as well as bankruptcy. Her coverage often focused on stories at the intersection of law, business, politics, and technology. Natalie has covered Donald Trump’s criminal and civil cases, the wave of lawsuits against the second Trump administration, the indictment and criminal trial of Sean “Diddy” Combs, the shooting death of UnitedHealthcare CEO Brian Thompson, and the legal battles facing Elon Musk and his companies. Natalie came to Business Insider in June 2021 as a breaking news reporter, focusing on the most interesting angles on the day's trending news. Natalie largely drove BI’s coverage around the fatal “Rust” shooting involving Alec Baldwin and the disappearance and murder of Gabby Petito.Prior to joining BI, Natalie worked for the New York Post, the New York Daily News, and The Brooklyn Paper. She has an extensive background covering crime and courts. During her more than 12-year journalism career, she did a stint covering the police beat out of the New York Police Department's headquarters. Natalie, a Brooklyn native, graduated from Brooklyn College in 2012 with a degree in journalism. SpaceX AI Elon Musk More