Morgan Stanley's Adam Jonas says SpaceX's distributed inference cloud is the most overlooked growth story, and Elon Musk calls it a very big deal
Morgan Stanley's Adam Jonas in new @SpaceX note: "The part of the SpaceX story that we believe holds the greatest growth potential, and that is being largely ignored/not contemplated by investors, is the Distributed Inference Cloud. Investors are already witnessing some degree of corporate/regulatory/social angst toward data centers. We see SPCX's efforts as instrumental in helping to get the Super Intelligence Economy and the Physical Intelligence Economy on the next leg of growth and economic development. As the 'density' of physical agents increases, we expect incrementally greater intelligence capability of the collective mobile swarm. We ask investors to be prepared to hear about the Distributed Inference Cloud and physical AI swarms in the coming year. From our seat, we think this subject is very close to breaking out in the investor discussion. Gradually… then suddenly."
Context
A major bank analyst arguing that fleets of robots and devices could become a giant AI computing network adds to the case investors are building for SpaceX's AI ambitions.
Sawyer Merritt is quoting a Morgan Stanley research note, so this is secondhand; the full note is not public. Elon Musk, who leads SpaceX, quote posted it saying True, this is a very big deal. Details of the note beyond the quote come from secondary summaries and could not be checked against the original.
Deep dive
On October 13, Sawyer Merritt posted a quote from Morgan Stanley analyst Adam Jonas in a new SpaceX note.
In the quote, Jonas wrote that the part of the SpaceX story with the greatest growth potential, and that is being largely ignored by investors, is the Distributed Inference Cloud. He wrote that investors are already seeing corporate, regulatory and social angst toward data centers, and that as the density of physical agents increases, he expects greater intelligence capability from the collective mobile swarm.
Jonas asked investors to be prepared to hear about the Distributed Inference Cloud and physical AI swarms in the coming year, adding that the subject is very close to breaking out in investor discussion: Gradually, then suddenly.
Elon Musk replied: True, this is a very big deal.
KuCoin and Bitget summaries of the note reported that it imagines about 2.2 billion robots with 500 watts of computing each, about 1.1 terawatts in total, linked through Starlink by 2040, as SpaceX's fastest route to a terawatt of compute. Those figures come from secondary summaries and could not be confirmed against the original note.
What to expect next
Watch whether SpaceX describes a distributed inference plan in its own materials, which would show whether the idea is company strategy or analyst speculation.
Also watch whether other analysts pick up the theme, and whether Tesla's cars and robots are formally tied into such a network, as some summaries of the note suggest. SpaceX's own disclosures, including any public filings, would be the best way to test the analyst's claims against company plans.