Prediction: SpaceX will not compete with Tesla. Instead, it’s going to buy an Nvidia-backed artificial intelligence (AI) company.
According to newly released details, SpaceX plans to issue 555.6 million shares in its upcoming initial public offering (IPO) at $135 per share. That means the SpaceX IPO will raise $75 billion — the largest of any company in history.
Investors already know that some of SpaceX’s IPO proceeds have been earmarked for chip purchases. Nvidia and to build its own TeraFab fabrication facility. Also, the company’s S-1 filing indicates a clear appetite for acquisitions.
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Wall Street continues to speculate about a potential merger TeslaI think the most compelling and overlooked opportunity is hiding in plain sight Nokia(NYSE: NOK ). That could open up why acquiring Nokia makes strategic sense for SpaceX as the company pursues its goal of creating an end-to-end sovereign AI platform.
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Why SpaceX might be interested in Nokia
When it comes to advanced computing capabilities, SpaceX’s procurement playbook is already clear. The company develops its own custom silicon through the TeraFab initiative, while maintaining a relationship with Nvidia for training and inference infrastructure.
In addition, SpaceX xAI — maker of the Grok Generative Model — to further integrate artificial intelligence (AI) development under one roof. Lastly, the company is in the process of getting Cursor to extend its reach towards developer tooling.
As a former mergers and acquisitions (M&A) analyst, I don’t see SpaceX’s pattern as inconsistent. Elon Musk is rapidly building a vertically integrated technology stack in compute, model development, and software. In my view, the next logical layer in this ecosystem is the physical, terrestrial communications infrastructure.
Nokia is one of the most dominant vendors in Radio Access Networking (RAN). RAN is telecommunications jargon for the distributed architecture of cell towers, antennas, and signal-processing equipment that connect networks to end devices such as cell phones.
What makes Nokia particularly interesting is its AI-RAN platform. The service enables real-time network optimization and on-device inference — eliminating the need to send queries through a remote data center.
From a technical perspective, this capability is a landscape echo of what Starlink does from orbit. While SpaceX controls both low-Earth-orbit broadband connectivity and AI-native RAN infrastructure, the company isn’t just competing in the telecom market. Instead, SpaceX will completely revolutionize how data moves and where intelligence lives for companies and consumers globally.
Nvidia could be the missing piece of the puzzle for the SpaceX-Nokia deal
Beyond the strategic overlap from a product roadmap perspective, what makes the deal between SpaceX and Nokia a reality is each company’s relationship with Nvidia. In October, Nvidia invested $1 billion in Nokia. The partnership specifically aims to co-develop AI-RAN solutions.
SpaceX, meanwhile, serves as an important customer of Nvidia’s GPUs. If Nokia is brought into orbit by Nvidia-SpaceX, the resulting tight-knit ring would be Nvidia providing the AI chips, SpaceX holding the network layer from orbit to ground level, and Nokia providing the terrestrial radio infrastructure.
Such a system is more than just an interesting telecom contract. This is the path to building a sovereign AI infrastructure empire. The combined stack — Nvidia and TeraFab accelerators on the ground train AI models, Nokia towers for inference on edge devices, and Starlink serves as the global distribution network — creating a closed-loop system that competitors can’t easily replicate.
Is the deal between SpaceX and Nokia realistic?
Nokia’s current market capitalization is around $90 billion. To be realistic, SpaceX would have to offer a combination of cash and stock to buy Nokia. The arrangement would give Nokia shareholders some say in the growth of the combined company while keeping SpaceX off its balance sheet.
While most Wall Street analysts covering the SpaceX IPO are modeling the space exploration business, I think a more plausible interpretation is that the company wants to create the tissue that binds the AI economy together. For me, Nokia is an important part of helping to complete this network.
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Adam Spadaco holds positions at Nvidia and Tesla. The Motley Fool has positions in and recommends Nvidia and Tesla. The Motley Fool has a disclosure policy.
Prediction: SpaceX will not compete with Tesla. Instead, it’s going to buy an Nvidia-backed artificial intelligence (AI) company. Originally Posted by The Motley Fool
