1 00:00:00,160 --> 00:00:04,480 Elon Musk just told his 234 million followers on X that 2 00:00:04,480 --> 00:00:07,720 SpaceX has already shifted its primary focus from Mars to 3 00:00:07,720 --> 00:00:12,280 building a self throwing city on our nearest neighbor, the Moon. 4 00:00:12,840 --> 00:00:17,480 The company spent 2 decades, 20 years telling all of us, telling 5 00:00:17,480 --> 00:00:21,600 the world that Mars colonization was the entire point of its 6 00:00:21,600 --> 00:00:24,280 existence. And now a Wall Street Journal 7 00:00:24,280 --> 00:00:27,720 report confirmed SpaceX told investors the same thing days 8 00:00:27,720 --> 00:00:31,840 earlier, targeting an uncrewed lunar landing by March. 9 00:00:32,080 --> 00:00:35,960 Now the XAI merger, 1,000,000 satellite filing with the FCC, 10 00:00:35,960 --> 00:00:39,240 and the largest IPO in history are all connected to the single 11 00:00:39,240 --> 00:00:42,120 strategic pivot. So what exactly changed inside 12 00:00:42,120 --> 00:00:46,120 SpaceX to make Musk abandoned the Mars First timeline he 13 00:00:46,120 --> 00:00:49,440 promised as recently as last year? 14 00:00:50,240 --> 00:00:54,080 Now Musk's merger memo to SpaceX employees describe plans for 15 00:00:54,280 --> 00:00:58,120 self growing bases and factories on the moon powered by the same 16 00:00:58,120 --> 00:01:02,200 AI infrastructure that XAI brings into the combined $1.25 17 00:01:02,200 --> 00:01:05,200 trillion entity. And we're going to breakdown why 18 00:01:05,200 --> 00:01:08,520 SpaceX shelved its 2026 uncrewed Mars mission. 19 00:01:08,800 --> 00:01:11,960 How the XAI acquisition feeds directly into the lunar 20 00:01:11,960 --> 00:01:14,560 construction plan. What the FCC filing for 21 00:01:14,560 --> 00:01:17,480 1,000,000 Orbital Data Center satellites actually means for 22 00:01:17,480 --> 00:01:21,560 the company's IPO evaluation and why the race against China to 23 00:01:21,560 --> 00:01:28,960 return humans to the Moon forced Musk to do all of this. 24 00:01:28,960 --> 00:01:34,400 SpaceX has officially abandoned its Mars First strategy in favor 25 00:01:34,400 --> 00:01:38,640 of building a permanent settlement on the Moon within 26 00:01:38,640 --> 00:01:42,240 the next 10 years now. The announcement came just days 27 00:01:42,240 --> 00:01:45,200 after the company completed the largest corporate merger in 28 00:01:45,200 --> 00:01:48,600 history. Observing Musk's AI company XAI 29 00:01:48,600 --> 00:01:51,200 at a combined valuation of 1.25 trillion. 30 00:01:51,760 --> 00:01:54,040 Now these two events are deeply connected. 31 00:01:54,360 --> 00:01:56,920 The financial engineering behind them tells you more than the 32 00:01:56,920 --> 00:02:01,360 press releases actually do. Musk laid out the logic on X in 33 00:02:01,360 --> 00:02:04,880 plane engineering terms. He said Earth and Mars only 34 00:02:04,880 --> 00:02:09,639 align for launch window every 26 months and each trips takes 35 00:02:09,680 --> 00:02:13,920 roughly 6 to 9 months one way. SpaceX can launch to the moon 36 00:02:13,920 --> 00:02:16,880 every 10 days with a 2 day transit time. 37 00:02:17,280 --> 00:02:21,160 That difference gives SpaceX roughly 13 times more iteration 38 00:02:21,160 --> 00:02:24,960 cycles on lunar missions compared to Mars missions in any 39 00:02:25,040 --> 00:02:27,240 given period. For a company that build its 40 00:02:27,240 --> 00:02:30,800 entire culture around rapid prototyping, blowing things up 41 00:02:30,800 --> 00:02:34,560 and rebuilding faster than math alone makes the Moon a far 42 00:02:34,560 --> 00:02:38,080 better near term target. Every failed system on a moon 43 00:02:38,080 --> 00:02:41,760 mission can be redesigned and relaunched within weeks, while a 44 00:02:41,760 --> 00:02:45,920 single Mars failure locks you out for over 2 years. 45 00:02:46,240 --> 00:02:49,200 Musk framed that decision as a question of civilization 46 00:02:49,200 --> 00:02:53,560 security, writing that the overriding priority is securing 47 00:02:53,560 --> 00:02:57,480 the future of civilization and the Moon is just simply faster 48 00:02:57,480 --> 00:03:00,720 to iterate on. The Wall Street Journal reported 49 00:03:00,720 --> 00:03:04,000 on Friday the SpaceX had already communicated this shift to 50 00:03:04,000 --> 00:03:06,240 investors before Musk said it publicly. 51 00:03:07,280 --> 00:03:11,840 Company is now targeting March 2027 for an uncrewed Starship 52 00:03:11,920 --> 00:03:14,320 lunar landing. No people on board. 53 00:03:14,480 --> 00:03:18,120 The mission falls under Spacex's existing NASA contract to 54 00:03:18,120 --> 00:03:21,440 develop a Starship variant, the HLS, capable of faring 55 00:03:21,440 --> 00:03:24,760 astronauts from lunar orbit to the surfaces part of the Artemis 56 00:03:24,760 --> 00:03:27,680 program. Now, NASA's crude Artemis 3 57 00:03:27,680 --> 00:03:32,720 landing is not expected until 2028, more than likely 2029. 58 00:03:32,800 --> 00:03:35,360 And that timeline has already been pushed back multiple times 59 00:03:35,360 --> 00:03:37,600 because Starship just wasn't ready. 60 00:03:38,160 --> 00:03:41,280 NASA Administrator Jared Isaacman has made the urgency 61 00:03:41,280 --> 00:03:44,520 clear, telling employees that the US has a great competitor 62 00:03:44,760 --> 00:03:49,040 moving at impressive speeds. Referring to China, of course. 63 00:03:49,560 --> 00:03:53,400 And no human has walked on the moon since Apollo 17 in 1972. 64 00:03:53,880 --> 00:03:57,040 And both nations, the US and China, are racing to change that 65 00:03:57,040 --> 00:04:00,640 before the end of the decade. President Trump signed an 66 00:04:00,640 --> 00:04:04,240 executive order on space policy late last year pushing for 67 00:04:04,240 --> 00:04:08,040 Americans on the moon by 2028, shifting his own earlier 68 00:04:08,040 --> 00:04:11,320 rhetoric after planting the American flag on Mars before the 69 00:04:11,320 --> 00:04:14,760 end of his term. Now, as recently as last year, 70 00:04:15,200 --> 00:04:19,079 Musk publicly stated he aimed to send an uncrewed mission to Mars 71 00:04:19,440 --> 00:04:23,480 by the end of this year. In September 2025, he predicted 72 00:04:23,480 --> 00:04:26,760 humans would have a settlement on Mars by 2055. 73 00:04:27,000 --> 00:04:30,800 Now, those timelines have now been formally shelved. 74 00:04:30,800 --> 00:04:34,320 SpaceX still plans to pursue Mars, with Musk saying 75 00:04:34,320 --> 00:04:37,800 construction of a Mars city would begin in five to seven 76 00:04:37,800 --> 00:04:41,120 years, but the immediate resources, engineering focus, 77 00:04:41,320 --> 00:04:44,400 and investor narrative have all shifted to the Moon. 78 00:04:44,880 --> 00:04:48,240 For those who have been following Musk's Mars promises 79 00:04:48,240 --> 00:04:51,360 going back to 2011, when he told the Wall Street Journal the 80 00:04:51,360 --> 00:04:54,840 SpaceX astronauts would reach Mars 20 years, this is a 81 00:04:54,920 --> 00:04:58,120 significant recalibration of the Company SCORE mission. 82 00:04:59,000 --> 00:05:02,920 Of course, SpaceX didn't make it in 15 years to Mars, and they're 83 00:05:02,920 --> 00:05:06,680 not going to in 20 years. And the XAI merger plays 84 00:05:06,680 --> 00:05:08,840 directly into this lunar strategy. 85 00:05:09,840 --> 00:05:13,600 SpaceX completed the acquisition on February 3rd, structuring it 86 00:05:13,600 --> 00:05:17,880 as a share exchange that valued SpaceX at a trillion dollars in 87 00:05:17,880 --> 00:05:21,280 XAI. At 250 billion, CIBC confirmed 88 00:05:21,280 --> 00:05:23,040 it is the largest merger of all time. 89 00:05:23,280 --> 00:05:26,640 Musk's own memo described the combined company is a vertically 90 00:05:26,640 --> 00:05:30,640 integrated engine spanning AI rocket space based Internet 91 00:05:30,960 --> 00:05:35,520 direct to mobile communications and the X social media platform. 92 00:05:35,880 --> 00:05:39,360 Now the merger brings XA is Grok AI models, its engineering 93 00:05:39,360 --> 00:05:42,360 talent and its massive compute infrastructure under the same 94 00:05:42,360 --> 00:05:45,920 corporate roof as Starlink's 9000 Plus satellites and 95 00:05:45,920 --> 00:05:49,800 Spacex's reusable rocket fleet. The internal anchor use case 96 00:05:49,800 --> 00:05:53,200 Musk keeps referencing is orbital data centers, solar 97 00:05:53,200 --> 00:05:57,120 powered satellite clusters that would run AI workloads in space 98 00:05:57,120 --> 00:06:00,320 where power and cooling constraints are fundamentally 99 00:06:00,320 --> 00:06:02,800 different from anything on Earth. 100 00:06:04,160 --> 00:06:06,520 Now I've been digging through the analytics of the show. 101 00:06:06,880 --> 00:06:09,840 Notice that 37% of you are following the show. 102 00:06:10,160 --> 00:06:14,360 For you, I'm forever grateful. Of course, the other 60 some odd 103 00:06:14,360 --> 00:06:17,000 percent of you haven't hit the follower subscribe button but 104 00:06:17,000 --> 00:06:19,800 have listened to the show before or have watched the show before. 105 00:06:20,200 --> 00:06:22,680 So I'm just going to give you a little bit extra here. 106 00:06:23,200 --> 00:06:25,760 I've been doing this for about 7 years, 7-8 years. 107 00:06:26,280 --> 00:06:27,640 I'm going to keep doing it for 10 more. 108 00:06:27,880 --> 00:06:31,000 And all I ask from you is a second, one second of your time 109 00:06:31,600 --> 00:06:33,680 to hit the follow or subscribe button on whatever platform 110 00:06:33,680 --> 00:06:35,680 you're listening to on right now. 111 00:06:36,160 --> 00:06:41,840 So thank you so much for that. Without you, I can't continue 112 00:06:41,840 --> 00:06:44,920 doing this. So all I need is your quick 113 00:06:45,200 --> 00:06:49,480 follow or subscribe now. Three days before announcing the 114 00:06:49,480 --> 00:06:52,920 XAI merger, SpaceX filed with the FCC to launch a 115 00:06:52,920 --> 00:06:57,040 constellation of up to 1,000,000 satellites designed to function 116 00:06:57,040 --> 00:07:00,120 as orbital data centers. Satellites could operate between 117 00:07:00,120 --> 00:07:05,120 502,000 kilometers altitude reliant optical inter satellite 118 00:07:05,120 --> 00:07:07,720 links and harness near constant solar power. 119 00:07:08,720 --> 00:07:13,400 And for context, there are currently about 14,500 active 120 00:07:13,400 --> 00:07:17,280 satellites in Earth orbit in 9555. 121 00:07:17,280 --> 00:07:19,080 Of those are Starlink satellites. 122 00:07:20,040 --> 00:07:23,920 SpaceX own filing called the project a first step toward 123 00:07:23,920 --> 00:07:29,600 becoming our Kardashev Type 2 civilization, one that can 124 00:07:29,600 --> 00:07:32,800 harness the sun's full power now. 125 00:07:32,800 --> 00:07:35,880 FCC Chairman Brendan Carr accepted the filing for public 126 00:07:35,880 --> 00:07:38,880 comment within five days. Muscat said he believes the 127 00:07:38,880 --> 00:07:42,520 lowest cost way to generate AI compute will be in space within 128 00:07:42,520 --> 00:07:45,720 two to three years, and then within five years SpaceX will 129 00:07:45,720 --> 00:07:49,240 launch and operate more AI compute in orbit then the entire 130 00:07:49,240 --> 00:07:52,000 rest of the world produces on the ground. 131 00:07:52,880 --> 00:07:56,040 Now, the financial structure behind all of this is also worth 132 00:07:56,040 --> 00:07:59,160 understanding. SpaceX generated an estimated $8 133 00:07:59,160 --> 00:08:04,720 billion in profit on 15 to $16 billion of revenue in 2025, with 134 00:08:04,760 --> 00:08:08,880 roughly 80% of that revenue coming from launching Starlink 135 00:08:08,880 --> 00:08:11,920 satellites. XAI, by contrast, is burning 136 00:08:11,920 --> 00:08:15,520 approximately a billion dollars per month as it tries to scale. 137 00:08:16,080 --> 00:08:20,120 Now the merger gives XAI kind of a lifeline through Spacex's cash 138 00:08:20,120 --> 00:08:23,560 flow while simultaneously giving SpaceX a higher growth narrative 139 00:08:23,840 --> 00:08:29,160 heading into an IPO. Aligning the merger and the FCC 140 00:08:29,160 --> 00:08:32,440 filing ahead of the IPO is just classic Musk's valuation, 141 00:08:32,440 --> 00:08:36,720 inflation, Spacex's packaging, a narrative of lowest cost AI 142 00:08:36,720 --> 00:08:39,240 compute for space. That's the kind of storyline 143 00:08:39,240 --> 00:08:42,480 that expands total addressable market and lifts growth 144 00:08:42,480 --> 00:08:47,000 multiples. The IPO targeting mid 2026 and 145 00:08:47,000 --> 00:08:54,000 evaluation of 1.5 trillion would be the biggest IPO ever. 146 00:08:54,600 --> 00:08:56,960 I want to be clear about the skepticism here because it's 147 00:08:56,960 --> 00:08:59,600 warranted. I am a fan of SpaceX. 148 00:08:59,600 --> 00:09:02,480 I'm a fan of Elon Musk and what he's done for the industries 149 00:09:02,480 --> 00:09:05,680 that he's part of. The concept of orbital data 150 00:09:05,680 --> 00:09:09,520 centers faces real engineering challenges, and Musk's timeline 151 00:09:09,840 --> 00:09:13,400 doesn't actually address radiation exposure. 152 00:09:13,800 --> 00:09:19,040 Extreme temperature swings between -240 and 300°F in low 153 00:09:19,040 --> 00:09:22,800 Earth orbit, the impossibility of physically servicing failed 154 00:09:22,800 --> 00:09:27,520 GP OS during long training runs, and latency constraints all 155 00:09:27,520 --> 00:09:32,520 remain unsolved at scale. It would take many years before 156 00:09:32,520 --> 00:09:36,560 anything substantive happens, and that a lot of things need to 157 00:09:36,560 --> 00:09:40,080 go right for it to work at a scale relevant to terrestrial 158 00:09:40,080 --> 00:09:44,520 alternatives. Now this merger of XAI and 159 00:09:44,520 --> 00:09:49,480 SpaceX carries an internal risk. Former XAI staffer on the human 160 00:09:49,480 --> 00:09:53,920 data team wrote publicly that XA is flat hierarchy and move fast 161 00:09:53,920 --> 00:09:56,200 and break things. Culture will collide with 162 00:09:56,200 --> 00:09:59,280 Spacex's more structured engineering processes, 163 00:10:00,000 --> 00:10:03,240 predicting culture shock for XAI employees. 164 00:10:03,680 --> 00:10:06,840 Wedbush on the other hand, sees a growing chance that Tesla will 165 00:10:06,840 --> 00:10:11,360 eventually be folded into SpaceX and XAI entity over the next 12 166 00:10:11,360 --> 00:10:15,840 to 18 months, creating a unified ecosystem connecting electric 167 00:10:15,840 --> 00:10:20,200 vehicles, autonomous driving, humanoid robots, orbital 168 00:10:20,200 --> 00:10:23,840 infrastructure and AI models under a single corporate 169 00:10:23,840 --> 00:10:28,280 structure in SpaceX. Well, they officially shifted 170 00:10:28,280 --> 00:10:31,360 from a Mars first company to Moon first company. 171 00:10:31,520 --> 00:10:34,560 Still pretty cool. Backed by the largest merger in 172 00:10:34,560 --> 00:10:39,360 corporate history. 1,000,000 satellite, FCC filing and an IPO 173 00:10:39,360 --> 00:10:43,040 that could value the combined entity at $1.5 trillion. 174 00:10:43,600 --> 00:10:49,040 Some of that money may go towards acquiring Tesla, and 175 00:10:49,040 --> 00:10:51,920 Musk still says Mars is coming in five to seven years. 176 00:10:51,920 --> 00:10:55,720 But the money, the engineering focus, and the investor pitch 177 00:10:56,400 --> 00:11:00,840 are all pointed at the Moon in an orbital AI infrastructure in 178 00:11:00,840 --> 00:11:03,640 the race against China to return humans to the lunar surface, 179 00:11:03,640 --> 00:11:07,640 combined with the practical math of 10 day launch cadences versus 180 00:11:07,640 --> 00:11:12,080 26 month planetary alignments is why they did this. 181 00:11:12,520 --> 00:11:15,280 And whether the orbital data center vision is real 182 00:11:15,280 --> 00:11:21,880 engineering or a pre IPO talk. Inflation will become clear soon 183 00:11:21,880 --> 00:11:24,360 enough. But for now, SpaceX is betting 184 00:11:24,360 --> 00:11:28,160 its future on our closest terrestrial neighbor, the Moon.