Travis Hoium

Is this something that investors should be thinking about?

that maybe there's a new supplier in town, that maybe this is going to be this vertically integrated company that's going to take on a Google.

I mean, where does your head go?

Because it seems wild on the surface.

But like Tim said, there is some logic to it.

So you got to take it seriously.

So you think that Musk building out this chip capacity just makes sense in the long-term Musk vision?

And I want to put some numbers to this.

SpaceX is not public yet, but it could go public later this year and definitely is a stock that a lot of people in the Motley Fool universe are probably going to at least be interested in.

But Tesla is going to be at least a partial funder of this TerraFab if it ends up happening.

They have $44 billion worth of cash right now, but they also have almost $8 billion worth of debt.

And their free cash flow, I believe they're going to spend $25 billion this year in CapEx, is likely to go negative this year.

You also need a lot of money to be a car company.

So, you know, Dan, the thing that we have to throw into this, too, is that this is the vertically integrating is very risky because if you don't have the demand, then you just are stuck with a whole bunch of fixed costs and a whole bunch of capex that you've spent.

By the way, we found out this week that XAI, which bought all these NVIDIA chips, didn't have demand for their Grok AI tool.

So now they're just selling that to Anthropic.

That may end up working out.

But if we get to a world five years from now where you're suddenly building all this CapEx and we do have some sort of bubble, that seems like a really tough place to be.

Tim, let's speculate a little bit.

When you think about the investment landscape and this kind of an announcement, the one company that came to mind for me is, I mentioned early on, TSMC has been this break on the AI build-out.