Elon Musk Questions Financial Backing of Project Stargate After $500 Billion Announcement

Tesla Inc. CEO Elon Musk expressed skepticism on Wednesday regarding the recently announced $500 billion initiative known as Project Stargate. Just hours after its official unveiling, Musk claimed that the leading investor, SoftBank Group, has "well under $10 billion secured" for the project.

What Is Project Stargate?: The ambitious plan was introduced during a White House briefing that included President Donald Trump. The joint venture involves major tech players like OpenAI, SoftBank, and Oracle Corp. and aims to create extensive artificial intelligence infrastructure across the United States.

In Musk's own words, "They don't actually have the money." He emphasized, "SoftBank has well under $10 billion secured. I have that on good authority." This remark raises questions about the financial stability of the project.

During the briefing, Oracle co-founder Larry Ellison referenced the project's potential, particularly its healthcare applications. One innovative aspect mentioned was an AI-based system capable of delivering personalized cancer vaccines in just 48 hours.

The initiative plans to deploy an immediate $100 billion, beginning with the establishment of a 500,000-square-foot data center located in Abilene, Texas. The overall plan includes the setup of nine additional facilities, with possibilities for expansion to as many as 20 locations.

At the same time, stocks for technology partners like Microsoft Corp. and NVIDIA Corp. received a boost following the announcement. NVIDIA's stock increased by 3.95% to $143.15, while Arm Holdings saw an impressive jump of 8.94%, reaching $162.60.

OpenAI, which will handle the operational aspects of the initiative, has maintained that the project will secure American leadership in AI technology and create hundreds of thousands of jobs for Americans. Masayoshi Son, the CEO of SoftBank, is set to chair the project's efforts.

Future Implications

The announcement of Project Stargate presents a landmark moment in the drive toward AI advancement, yet raises significant concerns regarding its financial backing. Companies involved will need to demonstrate that the necessary funding is secured to realize the project's ambitious goals.

Ultimately, Musk's public questioning of SoftBank's financial commitments could lead to increased scrutiny over the viability of Project Stargate.

Elon, SoftBank, AI