Elon Musk slams Trump-backed ‘Stargate’ deal between OpenAI and SoftBank

Elon Musk is already casting doubt on OpenAI’s new investment deal of up to $500 billion with SoftBank (SFTBY+10.28%) and Oracle (ORCL+6.70%)despite the support of his allies – including President Donald Trump.

The companies are merging what they call the “Stargate Project”, probably named after sci-fi franchisewhich aims to spend $500 billion over the next four years to build artificial intelligence infrastructure in the United States. The companies said Tuesday they would begin implementing $100 billion “immediately,” which will “generate massive economic benefit for the entire world.”

When the deal was announced Tuesday at the White House, Trump — along with Oracle Chairman Larry Ellison, OpenAI CEO Sam Altman and SoftBank CEO Masayoshi Son — said the group would create a “new American company” that would generate more than 100,000 American jobs . Ellison said the group’s first project, a million-square-foot data project, is already underway in Texas.

There’s just one problem with Stargate, according to Musk, an OpenAI co-founder who has the site sued to block it and Altman’s plans: They don’t have the cash.

“They don’t actually have the money,” the Tesla (TSLA-0.26%) The CEO and close Trump ally said shortly before midnight Tuesday in a post on his social media X. “SoftBank has well under $10 (billion) secured. I have that on good authority,” Musk added just before 1 ET.

His comments marked a rare split between the world’s richest man and Trump, who Joined Monday. Musk was one of Trump’s biggest financial backers during the 2024 presidential campaign and has been given its own task force, called DOGEand staff. The Trump administration already faces at least four legal proceedings over DOGE.

Musk’s remarks also show that despite Altman and Amazon founder Jeff Bezos’ comments last month, Musk is not content to sit on the sidelines as his rivals profit from the new Trump administration. Altman said in December that he means “pretty strongly that Elon would do the right thing and that it would be profoundly un-American to use political power” against business rivals.

In addition to Musk’s long-running feud with Altman and lawsuits, he also founded an AI startup, xAI, to compete with OpenAI and other firms. xAI last month raised $6 billion at a $50 billion valuationless than two years after he founded the company. That cash is expected to help xAI expand its Colossus supercomputer in Memphis, which it developed with Nvidia (NVDA+3.49%) chips.

xAI also works closely with Musk’s X. His social media platform, formerly Twitter, employs Grok, a chatbot developed by his xAI startup. Ellison is one investor in X, respectively served on Tesla’s board, and the pair of billionaires have a long-standing friendship.

Stargate will be led by Son, while SoftBank will have financial responsibility for the company, while OpenAI will handle operations. These companies, along with Oracle and MGX, are the first equity backers. SoftBank-backed arm Microsoft (MSFT+1.93%)and Nvidia will work with Oracle and OpenAI on the technology.

“We all look forward to continuing to build and develop AI – and especially AGI – for the benefit of all humanity,” OpenAI said in a declaration. “We believe this new step is critical down the road and will enable creative people to figure out how to use AI to uplift humanity.”