Quote · Excess Returns

The Trillion Dollar Gap | Aswath Damodaran on SpaceX, AI and the Big Market Delusion

Explore episode Jun 19, 2026

In the big AI story, what's SpaceX saying? We're going to be players in this space. We're going to compete. We're going to win a significant market share of the AI market. But in the same breath, they're also saying, We're renting out space from our data centers to our biggest competitors.

Aswath Damodaran

The Trillion Dollar Gap | Aswath Damoda…

Where this was said

The tension between SpaceX competing in AI and renting data centers to competitors

At 19:50 · chapter starts 17:10

Damodaran identifies SpaceX's internal tension: claiming to be an AI winner while renting data centers to rivals Google and Anthropic for ~$2B — an unresolved strategic contradiction.^{[1]

— Aswath Damodaran

"SpaceX claims it will win a dominant share of the AI market. At the same time, it generates nearly $2 billion renting data center capacity …"

19:50}

We make this mistake of assuming growth is always good, but growth when it's accompanied by huge amounts of reinvestment and substandard gross margins, which unfortunately the state of the AI market now is insane amounts of CapEx might not just be neutral to value, but actually be value destructive.

Aswath Damodaran

The Trillion Dollar Gap | Aswath Damoda…

Business

The Internal Contradiction at the Heart of SpaceX's AI Strategy

The Trillion Dollar Gap | Aswath Damodaran on SpaceX, AI an… · Jun 19, 2026 Business

SpaceX claims it will win a dominant share of the AI market. At the same time, it generates nearly $2 billion renting data center capacity to Google and Anthropic — its biggest AI competitors. Damodaran frames this as a fundamental strategic contradiction: SpaceX needs to pick whether it's an AI competitor or an AI infrastructure landlord, because you can't credibly be both.