Musk doubts Trump-backed Stargate project: 'They don't actually have the money'

Entrepreneur and X CEO Elon Musk has cast doubt on whether there will be enough funding to pursue a massive $500 billion artificial intelligence (AI) infrastructure project he has announced. President Donald Trump on tuesday

In the new project, called Stargate, Softbank, OpenAI and Oracle will join forces to create data centers in the United States to further develop artificial intelligence, which promises to increase productivity through job automation.

Oracle CEO Larry Ellison also suggested that the project could make it easier to treat diseases like cancer by creating a customized vaccine. Technology With the digital health file

Trump announced the largest AI infrastructure project “in history” involving Softbank, OPENAI and ORACLE.

The initial investment is expected to be 100 billion dollars and can reach five times this amount. Microsoft, Nvidia, investor MGX and chip makers Arm are also partners in this project.

“Project Stargate is a new company that plans to invest $500 billion over the next four years to build a new artificial intelligence infrastructure for OpenAI in the United States,” said OpenAI's announcement at X on Tuesday. We will start deploying $100 billion.”

But the maskAt odds with OpenAI CEO Sam Altman, he suggested on X that the AI ​​company doesn't have the cash to back up its announcement.

“They don't actually have money,” Musk wrote in a tweet on X in response to OpenAI's post.

Musk then followed up his post by writing, “SoftBank is less than $10 billion guaranteed. I have this on good authority.”

But Altman responded to Musk's statement.

Trump called for an end to the TikTok ban, seeking to focus on artificial intelligence in his second term

Wrong, as you surely know. Altman wrote.

“It's great for the country. I understand that what's great for the country isn't always what's best for your companies, but in your new role I hope you'll put more of America first.”

Altman also seems to play down the situation, praising Musk for being one of the “most inspiring entrepreneurs of our time.”

In March, Tesla CEO Musk announced that he had done just that Complaint against ChatGPT developer OpenAI and Altman, among others, said they had abandoned the company's core mission of developing open-source AI technology for the benefit of humanity over profit.

Meanwhile, a source familiar with Stargate told Fox Business that Stargate is ready to deploy $100 billion immediately.

The companies in the venture are well-positioned to raise equity from well-capitalized founding partners, additional equity from co-investors, as well as third-party debt and other sources, the source said.

SoftBank, for example, had $24.3 billion in cash on its balance sheet as of Sept. 30, 2024, per its latest earnings. As income, SoftBank's loan-to-value was 12.5%.

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MGX is said to have $100 billion in capital commitments, Oracle has $11 billion in cash on its balance sheet. While OpenAI It recently announced a capital raise of more than $10 billion, per sources.

CEO of Microsoft Asked on CNBC about Musk's comments on Wednesday, Satya Nadella said Microsoft has committed $80 billion to the project.

“All I know is that I'm good for my $80 billion,” Nadella said. “Customers can count on Microsoft to have OpenAI models everywhere in the world and to provide services to OpenAI and other models.”

Fox Business understands that the companies involved in Stargate are undecided on how to fulfill the $500 billion commitment. Some may invest more in the project than others.