How Do You Get to $2 Trillion?

Hunt, Jason, and Mike break down the freshly filed SpaceX S-1 and ask the only question that matters: how do you justify a $2 trillion valuation on a company with almost no free cash flow? They work through the AI stack, the Starlink connectivity business, and the launch economics that quietly underwrite all of it. The Cashflow Memo Key Takeaways * SpaceX filed its S-1 targeting a ~$2T valuation against negligible free cash flow; Hunt frames it next to Tesla (~$1.5T on ~$6B FCF) as proof you can pile on valuation with no EBITDA or FCF, set against NVIDIA’s new record ~$163B FCF run-rate and Apple’s ~$120B. * The promotional $22T TAM rests mostly on the least-proven leg — AI (Macrohard agentic workloads, applications not yet invented), a Tesla/SpaceX JV pairing Tesla’s world model with xAI’s language models, plus a ~$55B Terafab chip-production plan. * The Anthropic lease puts a mark on the data centers: xAI leasing Colossus-1 to Anthropic at ~$1.5B/month against a Open & Disclaimer Welcome and the standard informational disclaimer. [00:30] Exhibits A, B & C: Energy and the Government’s Books Hunt on oil and gas pricing through the Iran disruption, weak Waha gas curtailing Permian supply, and a fiscal ’27 federal deficit that stays stuck near $1.5T. [05:51] Macro Grab Bag: Grid Curtailment, Taiwan, and Reshoring DOE clears PJM to curtail data-center power in a grid stress event; the hosts reject Chamath’s nobody cares about Taiwan in 18 months call; Gavin Baker’s point that the Iran war helps US reshoring by raising energy costs more abroad than at home. [09:55] NVIDIA & Apple: Free Cash Flow Records NVIDIA at a ~$163B FCF run-rate (new all-time record, eclipsing old Exxon peak), Apple at ~$120B, against $5.6T and ~$4.5T market caps. [11:34] The SpaceX Question: $2T With No Cash Flow Framing the S-1 alongside Tesla — huge valuations attached to businesses not yet generating EBITDA, income, or free cash flow. [12:51] The AI Stack: xAI, Colossus, the Anthropic Lease, Cursor & Macrohard The $22T TAM and its least-proven leg; xAI’s record build speed; Anthropic leasing Colossus-1 at ~$1.5B/month; the Cursor acqui-hire; Macrohard agentic workloads as a Tesla/SpaceX JV; the $55B Terafab plan. [19:05] Starlink: The Supposed Crown Jewel $11.4B 2025 revenue, 39% operating / 63% EBITDA margin, 10.3M subscribers — and why the hosts think the conventional crown jewel label is misplaced. [19:43] Launch Economics: The Real Crown Jewel 122 SpaceX vs. 43 customer launches; backing Starlink out at market rate to reveal true space economics; 65-75% and rising customer-launch margins; cost/kg from Falcon ~$850 toward Starship ~$100 vs. NASA’s ~$19,000. [22:52] Data Centers in Orbit Why a space data center is a distributed network of ~125kW AI racks in sun-synchronous orbit, not a monolith; the physics of power and heat; latency math vs. terrestrial fiber. [25:54] Q&A: Would You Switch? The Choke-Point Thesis, T-Mobile & Space Junk Whether you’d prefer Starlink inference in 24 months; routing frontier-model inference through Starlink as a negotiating choke point; Starlink V3 + T-Mobile direct-to-cell; Kessler-cascade space-junk risk. [32:18] Next Week Healthcare deep dive, then a future episode on Musk’s TSMC-replacement / Terafab vision and space junk. Subscribe and grab the Cashflow Memo at telltales.us. Cashtags $$SPCX $NVDA $AAPL $GOOGL $TSLA $XOM $MSFT $AMZN $TMUS $TSM This post and the information herein are intended for informational purposes only. The views expressed herein are the author’s alone and do not constitute an offer to sell, or a recommendation to purchase, or a solicitation of an offer to buy, any security, nor a recommendation for any investment product or service. While certain information contained herein has been obtained from sources believed to be reliable, neither the author nor any of his employers or their affiliates have independently verified this information, and its accuracy and completeness cannot be guaranteed. Accordingly, no representation or warranty, express or implied, is made as to, and no reliance should be placed on, the fairness, accuracy, timeliness or completeness of this information. The author and all employers and their affiliated persons assume no liability for this information and no obligation to update the information or analysis contained herein in the future. This is a public episode. If you would like to discuss this with other subscribers or get access to bonus episodes, visit telltales.substack.com