On August 14, 2026, NVIDIA Corporation (NASDAQ:NVDA) disclosed that its Space Exploration Technologies Corp. (NASDAQ:SPCX) stake was worth about $21 billion at the end of the second quarter. A position that traces back to a $10 billion investment NVIDIA made in Elon Musk’s xAI as part of a $20 billion funding round in January 2026, before SpaceX acquired xAI for $1.25 trillion that February.
Why This Matters
NVIDIA Corporation (NASDAQ:NVDA)’s stake in Space Exploration Technologies Corp. (NASDAQ:SPCX) wasn’t originally a bet on rockets; it was a bet on Musk’s AI lab that was later folded into SpaceX. Does this circuitous path show Nvidia’s financial entanglements paying off in unexpected ways, or does it reveal just how tangled Nvidia’s relationships with its biggest customers have become?
The Bull and Bear Case: Nvidia
NVIDIA Corporation (NASDAQ:NVDA) owns 122.8 million SpaceX shares. Musk said on SpaceX’s own second-quarter earnings call that the company will exclusively use Nvidia chips in its AI data centers. He caled Nvidia’s graphics processing units the “best architecture” for training and running AI models. Musk added that SpaceX expects a significant allocation of Nvidia’s next-generation Vera Rubin GPUs next year. He plans to grow its computing capacity from 2 gigawatts today to closer to 10 gigawatts by the end of 2027, a large future demand pool locked in almost exclusively for Nvidia’s hardware.
Space Exploration Technologies Corp. (NASDAQ:SPCX) shares closed at $140 on August 14, 2026, after the disclosure, down from $170.86 at the end of June. It means the real-time value of Nvidia’s stake had already fallen to about $17.2 billion from the $21 billion headline figure. Nvidia’s other major disclosed stake, in Intel, fell even more sharply, down to about $22 billion from $30 billion just three months earlier. The Financial Times noted the disclosure highlights the scale of Nvidia’s effort to forge “complex and often circular financial links across the AI industry.” It is a pattern that also shows up in NVIDIA Corporation (NASDAQ:NVDA)’s separately reported talks to invest up to $3 billion in SB Energy, the SoftBank subsidiary building an OpenAI data center project in Ohio.
The Bull and Bear Case: SpaceX
Musk’s exclusive Nvidia commitment gives Space Exploration Technologies Corp. (NASDAQ:SPCX) a clear, singular hardware roadmap for its AI ambitions rather than juggling multiple chip suppliers. The plan to nearly quintuple compute capacity by 2027 shows aggressive expansion already underway.
NVIDIA Corporation (NASDAQ:NVDA) is only Space Exploration Technologies Corp. (NASDAQ:SPCX)’s sixth-largest investor, well behind Musk himself at roughly $850 billion and Alphabet at roughly $78 billion. It shows that even a $21 billion stake is a relatively modest position in a company whose ownership is now dominated by a handful of massive holders.
Insider Monkey’s Hedge Fund Data
NVIDIA Corporation (NASDAQ:NVDA) was held by 275 hedge funds as of Q1 2026, up from 264. SpaceX itself doesn’t appear in Insider Monkey’s hedge fund database, since it only went public in June 2026.
Conclusion
Nvidia is becoming one of the most important financiers in AI infrastructure, not just its biggest supplier. Its Space Exploration Technologies Corp. (NASDAQ:SPCX) stake, born out of an xAI bet that later got absorbed into SpaceX entirely, shows just how unpredictable that role can be.
While we acknowledge the risk and potential of NVDA as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than NVDA and that has 10,000% upside potential, check out our report about this cheapest AI stock.
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Disclosure: None. This article is originally published at Insider Monkey.
