Anthropic to Pay xAI $1.25 Billion Monthly for Compute Through 2029
Anthropic agreed to pay xAI $1.25 billion per month through May 2029 for access to the Colossus 1 data center. The deal includes a discounted rate for the first two months while capacity ramps up.
techjuice.pkAnthropic will pay xAI $1.25 billion per month through May 2029 for access to 300 megawatts of compute capacity at the Colossus 1 data center near Memphis, Tennessee. The agreement covers the full output of the facility, with a reduced fee for May and June 2026 during the ramp-up period. The total value of the contract could exceed $40 billion if it runs to term.
The contract emerged from SpaceX’s S-1 filing with regulators. Either party may terminate the agreement with 90 days’ notice. The filing stated the arrangement “allows us to monetize unused compute capacity in our infrastructure.” The company added that it expects to enter into additional similar services contracts.
The transaction gives xAI a hybrid position in the AI market by selling excess capacity to another developer. Usage of xAI’s Grok assistant has declined in recent months, freeing servers for external use. SpaceX described the approach as a dual monetization strategy that provides multiple pathways to generate returns on invested capital.
“We believe our dual monetization strategy provides multiple pathways to generate returns on invested capital.”
Key Facts
Story Timeline
2 events- May 20, 2026
Details of the Anthropic-xAI compute deal surfaced in SpaceX’s S-1 filing.
3 sourcesTechCrunch · @SawyerMerritt · @WatcherGuru - Earlier this month
Anthropic secured the entire output of the Colossus 1 data center.
1 sourceTechCrunch
Potential Impact
- 01
Anthropic secures large-scale compute for model training through 2029.
- 02
xAI gains revenue from unused compute capacity ahead of potential public offering.
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