SpaceX is said to overhaul AI infrastructure team as data center delays mount

SpaceX has initiated a major reorganization of its artificial intelligence data center division, bringing in senior executives from its rocket and Starlink programs after facing engineering and reliability challenges across facilities in Tennessee and Mississippi. Reports indicate that several sites operated for months without standard backup power and cooling systems during rapid capacity expansion efforts. Consequently, SpaceX has postponed several planned data center developments outside its primary Memphis hub, including proposed locations in Texas. This infrastructure shake-up highlights emerging operational hurdles for SpaceX's aggressive AI ambitions, which are central to its long-term valuation and growth strategy. Reliable data center infrastructure is critical for fulfilling capacity rental contracts with key customers such as Google and Anthropic, as well as powering internal AI tools following its $60 billion acquisition of startup Cursor. Delays and system instability risk elevating operational costs, constraining future revenue growth, and dampening investor enthusiasm. Despite the operational headwinds, SpaceX recorded approximately 1.4 gigawatts of operational capacity in June and aims to reach over 2 gigawatts by the end of the year. Driven by substantial compute lease agreements, the company's AI-related revenue surged to $2.6 billion in the second quarter of 2026, up sharply from $737 million in the prior-year period.