Mach33 CEO Aaron Burnett: Wall Street Does Not Truly Understand SpaceX's Culture of "Facing Grand Challenges"
Aaron Burnett, CEO of Mach33 Financial Group, stated on social media platform X that Wall Street does not truly understand SpaceX's culture of "facing grand challenges." He expressed confidence in the company's execution capabilities, noting that during this wave of global infrastructure development, he sees alignment in the company's computing power strategy among Elon Musk, Gwynne Shotwell, and Bret Johnsen, even if not every specific goal is achieved. "I would rather bet that they will exceed expectations."
This statement comes as SpaceX intensively discloses its progress in computing power expansion. CFO Bret Johnsen recently revealed at the Goldman Sachs Communacopia+ Technology Conference that the computing power scale will increase from 1.4 GW in Q2 of this year to over 2 GW by the end of the year, with a target of reaching 10 to 20 GW by the end of 2027. Musk himself admitted, "I don't think we can reach 20 GW," with a more realistic expectation of around 15 GW. President Gwynne Shotwell also detailed the expansion of the Starlink constellation and ground infrastructure plans. The three executives' concentrated statements on computing power strategy reflect the "team alignment" that Burnett referred to.
Johnsen disclosed that the company has signed four large computing power hosting contracts in recent months: a service contract with Anthropic worth $1.25 billion per month (equivalent to an annual revenue of $15 billion); a contract with Alphabet's Google worth $920 million per month (annual revenue of $11.04 billion); and two unnamed clients, each with a monthly fee of $1.1 billion, with annual revenues of approximately $13.4 billion and $6.7 billion respectively—these four contracts alone amount to an annual recurring revenue (ARR) of about $46.1 billion. The company's total business line ARR is approximately $71.3 billion, with Starlink contributing $17.2 billion, launch services contributing $4 billion, and the previously acquired Cursor contributing $4 billion. Both Musk and Johnsen stated that the company aims to achieve an overall ARR of over $100 billion by December this year, with Johnsen asserting, "This is not a question mark."
However, Wall Street has reservations about this narrative. Reports in August indicated that SpaceX exposed engineering defects in its data center construction in Tennessee and Mississippi, with some sites being put into operation and accelerated expansion before power backup and cooling systems were in place. The company subsequently reorganized its computing power infrastructure team, bringing in executives with backgrounds in rocket and spacecraft manufacturing, such as Wesley Salandro and Logan McConnell, to apply aerospace engineering discipline to computing power infrastructure construction. Meanwhile, SpaceX's stock price currently corresponds to a price-to-sales ratio of about 96 times, with a net loss of $541 million in Q2. AI-related capital expenditures have reached $16 billion, doubling from the previous quarter, and the stock price fell by more than 10% after the news was announced.
According to previously disclosed quarterly data, SpaceX's Q2 revenue was $7.8 billion, a 92% year-on-year increase; the Starlink business accounted for more than half of total revenue, with a year-on-year growth rate of 66%, and the global user base reached 12 million, with an increase of 1.7 million in Q2 alone. SpaceX has recently completed its IPO, and Shotwell previously admitted to having reservations about pushing for an IPO for many years, but is now sending confidence signals to investors; the company has also integrated xAI, which was previously an independent business, and the current round of computing power client contracts is being handled through xAI-related business.
From a funding and market logic perspective, SpaceX's core narrative is to replicate the high-intensity mass production and engineering discipline accumulated in aerospace engineering into the current globally scarce AI computing power infrastructure construction. This allows it to quickly enter the high-margin cloud computing and computing power leasing sector amid tight supply of Nvidia chips and long expansion cycles for traditional cloud vendors, providing computing power hosting services to leading AI companies like Anthropic and Google. The direct beneficiaries are institutional investors who lock in long-term computing power contracts and bet on SpaceX's capacity realization; however, the high price-to-sales ratio of 96 times, continued negative net profits, and previously exposed data center engineering defects have led some Wall Street analysts to be cautious about whether the "end-of-year ARR will exceed $100 billion" target can be achieved in the short term. If subsequent quarterly capital expenditures continue to rise while computing power delivery progresses slower than expected, bullish positions betting on high valuations may face significant pullback pressure, while funds shorting or bearish on this narrative may profit from the execution risks in data center operations.
Source: Public Information
ABAB AI Insight
SpaceX's transplantation of the "mass production discipline" from aerospace engineering into computing power infrastructure construction is not a temporary decision but a continuation of the company's consistent engineering philosophy of "high-frequency iteration and rapid trial and error" since the development of the Falcon 9 reusable rocket—from the multiple failures of Falcon 1 to eventual success, to the continuous improvements after early experimental explosions of Starship. SpaceX has repeatedly advanced key technological breakthroughs with aggressive timelines that are often met or partially met despite widespread skepticism. The engineering defects exposed in the Tennessee and Mississippi data center construction during this computing power infrastructure project are, to some extent, a reoccurrence of this "rapid expansion followed by dynamic correction" approach in a new field. The company's subsequent decision to bring in executives with backgrounds in rocket and spacecraft manufacturing to take over the computing power team is also a continuation of its path of "solving new problems with aerospace engineering discipline."
From the perspective of capital mobilization logic, SpaceX's acquisition of xAI allows the AI computing power business, which would have required independent financing, to be directly incorporated into its balance sheet. Leveraging the cash flow capabilities of businesses like Starlink, it provides internal funding support for the capital-intensive computing power infrastructure construction—AI-related capital expenditures have doubled to $16 billion. This path of "internal cash flow supporting new business expansion" is consistent with its previous logic of using Falcon and Dragon launch revenues to fund Starship development. Meanwhile, the company prioritizes selling computing power capacity to leading AI labs like Anthropic and Google, which already have strong cash flow and financing capabilities, quickly realizing revenue by locking in long-term high-value contracts (with individual contracts generating annual revenues of up to $15 billion). This strategy of "binding the most certain large clients to counter high capital expenditures with contract realization" essentially hedges the uncertainty of its infrastructure construction progress with client certainty.
This path of "traditional manufacturing giants leveraging engineering discipline to cross into computing power infrastructure" bears similarities to the recent strategies of semiconductor manufacturing giants like TSMC and Samsung, which have continuously ramped up advanced process capacity to build competitive barriers through large-scale mass production capabilities. However, SpaceX's uniqueness lies in its broader cross-industry leap—from rocket and satellite manufacturing directly into data center operations, a field traditionally dominated by cloud computing vendors. In terms of the industry's current stage, SpaceX is in a rapid expansion phase of "exchanging capital expenditures for capacity scale," which aligns closely with the backdrop of tight Nvidia chip supply and ongoing global AI computing power shortages. However, its lack of experience in data center operations places it in a transitional phase, undergoing the necessary growing pains from being an "aerospace manufacturing company" to a "comprehensive infrastructure operator."
This phenomenon essentially represents an "industrial chain restructuring": the mechanism at play is that when the growth rate of global AI computing power demand significantly exceeds the capacity expansion rate of traditional cloud computing vendors, any giant with large-scale capital mobilization capabilities, engineering organizational capabilities, and site resources (such as Starlink ground stations and power and land resources around launch sites) has the opportunity to cross into this highly specialized market, which was previously dominated by a few cloud computing giants. This will gradually evolve the supply landscape of computing power infrastructure from being "cloud computing vendor-dominated" to a new stage of "diversified heavy asset enterprises in competition." Wall Street's skepticism towards SpaceX's cross-industry approach essentially reflects that the traditional capital market valuation framework has not fully adapted to this business model of "rapidly entering emerging scarce resource sectors using organizational capabilities accumulated from non-traditional industries." This cognitive gap is, in essence, the deeper reason behind Burnett's assertion that "Wall Street does not understand SpaceX's culture."
ABAB News · Law of Cognition
What appears as cross-industry to others is merely a change of battlefield for giants using the same set of disciplines.
What capital markets often fail to understand is the compounding effect of organizational capabilities.
The risk of high capital expenditures is always hedged by high certainty contracts.