Musk’s $119B Terafab, Anthropic Deal

Elon Musk is making a $119 billion bet on chips with the newly revealed Terafab project in Texas—a huge, vertically integrated semiconductor campus set to supercharge SpaceX, Tesla, and xAI. With Intel onboard and a major tax break decision coming June 3, the project adds massive firepower to Musk’s strategy of controlling his own tech supply chain. But this isn’t just about building more chips: it’s a 15-year play to outmaneuver supply constraints, rising geopolitical risks, and competitors like Nvidia and Apple.

But here’s the catch—funding it all means convincing IPO investors the risk is worth it. Enter the surprise SpaceX–Anthropic deal: by leasing out unused supercomputer capacity to Anthropic (an OpenAI rival), SpaceX turns idle hardware into real revenue, just as Anthropic desperately needs more computing power. It’s a bold move: monetize first, scale later, and show Wall Street that AI infrastructure can be a growth engine instead of a cost sink. Meanwhile, unions and pension funds are raising red flags about Musk’s control, mission-linked pay, and the risk of stuffing SpaceX stock into your retirement account by default.

Based on reporting from WIRED, Reuters, Bloomberg, and The Wall Street Journal.

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