Elon Musk does not often talk down his own company’s revenue, but he did just that on Nov. 8. “If compute becomes plentiful and cheap, SpaceX revenue will drop. No crying in the casino for either party,” he wrote in a post on X.
Two days later, Deutsche Bank made the opposite bet. The bank raised its 2028 forecasts for SpaceX on the view that computing power will stay scarce for longer, partly because voters just pushed back hard against new data centers. For shareholders, the question is which of those two pictures shows up first.
The casino post and the Anthropic deal
Elon Musk was not making a forecast out of nowhere. He was replying to a clip of investor Chamath Palihapitiya arguing that SpaceX could cancel its Anthropic compute contract on 90 days’ notice and re-sign it at double the price. “It works both ways, of course,” Musk wrote, according to 24/7 Wall St.
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Palihapitiya did not back down. He tied his scenario to spot prices rising “50%+ because of the lack of supply” and said the “odds will go up with every data center delay,” in his own post on X.
The contracts in question carry 90-day termination clauses. That flexibility is exactly what makes the pricing debate matter.
Elon Musk has already hinted that pricing is moving his way. On the Oct. 20 earnings call, he said SpaceX rents at “effectively the spot market rate,” and that renewals were coming in “at higher dollars per watt.” Finance chief Bret Johnsen said pricing was slightly above the top end of a $30 to $50 per-watt range.
Why Deutsche Bank thinks compute stays scarce
Deutsche Bank analyst Edison Yu took the other side of Musk’s warning. On Nov. 10, he raised his 2028 forecast for SpaceX’s EBITDA by $18 billion to $237.1 billion, lifted his revenue forecast to $315.3 billion and kept a Buy rating with a $250 price target, expecting limits on data centers to slow construction mainly in 2028, as reported by 24/7 Wall St.
The election gave him plenty of material. Voters weighed in on 41 data center measures in the midterms and were on track to reject new development in all but one. Ohio has held more of these votes than any other state this year, and Dan Ives of Yorkville Ives described Texas Governor-elect Gina Hinojosa as “a known anti-data center politician and negative on the AI buildout,” according to Al Jazeera.
Texas matters more than most states here. Hinojosa campaigned on an immediate moratorium on new data centers, though she would need the legislature to make it happen, and Texas holds about 27% of planned U.S. data center capacity.
Deutsche is not alone in seeing upside from pricing. Morgan Stanley’s Adam Jonas said SpaceX’s compute business has “the greatest growth potential and is being largely ignored by investors.”
He noted that consensus assumes only about $17.60 per watt and estimated that each extra $10 per watt could add more than $40 billion in revenue, as reported by TheStreet.
A bumpy ride for SpaceX stock
The business is already leaning hard on AI. SpaceX’s third-quarter sales rose 161% to $14.6 billion, and its Super Intelligence division brought in about 52% of that total. That is why any shift in compute prices could move the whole company.
Musk has also set lofty goals, saying annualized revenue could top $100 billion this December and projecting between $500 billion and $1 trillion by the end of 2027.
The stock has not made it easy for holders. SpaceX closed at $143.09 on Nov. 10, about 6% above its $135 IPO price but about 29% below its June record close, though it was up 16% from its Nov. 5 close, 24/7 Wall St reported.
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Jim Cramer likes the company but has held off buying. He has warned that “bulls are killed by excess stock supply” and said he is “very worried about the amount of supply” from SpaceX and other AI IPOs.
SpaceX expects fourth-quarter capital spending of $35 billion to $40 billion, well above Wall Street’s estimate of about $20 billion.
Big investors have felt the swings too. Alphabet booked an $8.7 billion loss on equity securities in the third quarter, driven mainly by the drop in SpaceX stock, TheStreet reported. Google is also one of SpaceX’s biggest compute customers, which ties the two companies together on both sides of the deal.
What investors watch next
The next test is in the sky. Starship Flight 15 is set for Nov. 13 and will try to catch both the booster and the ship, and Musk wrote that if both work, “it will mark the first time that all parts of an orbital rocket return to Earth intact,” in a post on X.
The bull case also has clear weak spots. If the data center backlash fades, or Anthropic and Alphabet find cheaper capacity, Deutsche’s thesis weakens, and the same approval freeze could hit SpaceX’s own planned Texas gas plant and compute site.
Even the bulls admit the valuation is stretched. Morgan Stanley keeps a $300 target but notes that at $100, investors would be pricing SpaceX’s entire AI business at zero. For now, Musk’s casino line is a reminder that scarcity is doing a lot of the work in SpaceX’s story.
Related: Goldman Sachs and Apollo changes position on SpaceX
