Elon Musk Questions SoftBank's Financial Viability in Stargate AI Project

Elon Musk, CEO of Tesla and SpaceX, has raised concerns about the financial viability of the Stargate AI project, questioning the ability of SoftBank Group's CEO Masayoshi Son to fund the ambitious initiative. In a tweet on March 2, 2025, Musk stated, "Masa is already overleveraged," suggesting that SoftBank may struggle to secure the necessary funding for the project.

The Stargate AI project, announced by President Donald Trump in January 2025, aims to build a robust AI infrastructure across the United States, with SoftBank's Son serving as chairman. The project involves a $500 billion investment over four years, with an initial deployment of $100 billion. However, Musk's comments have reignited concerns about the project's financial backing, as SoftBank is reportedly in talks to secure a $16 billion loan for AI investments, with an additional $8 billion potentially sought in early 2026.

Musk's skepticism about the project's financial viability is not new. In January 2025, he claimed that SoftBank had "well under $10B secured" for the project, adding, "They don’t actually have the money. I have that on good authority." Musk's criticism of the project comes despite the involvement of his close ally and mentor, Larry Ellison, who is serving as the initiative's chairman.

The Stargate AI project has significant market implications, with technology partners such as Microsoft, NVIDIA, and ARM Holdings seeing stock gains following the initial announcement. The project plans immediate deployment of $100 billion, beginning with a 500,000-square-foot data center in Abilene, Texas, with nine additional facilities planned and potential expansion to 20 locations.

While the project has the potential to create hundreds of thousands of American jobs and secure American leadership in AI, financial concerns loom large. Analysts have raised questions about SoftBank's ability to fund such a large-scale project, with some suggesting that Trump's reliance on emergency declarations to fast-track the initiative underscores its scale and urgency.

The Stargate AI project comes as the US faces stiff competition in AI development from China. In December 2024, SoftBank pledged $100 billion to US investments, responding to Trump's call for increased commitment. OpenAI CEO Sam Altman has emphasized the project's transformative potential, stating that it could revolutionize healthcare and improve quality of life globally.

In conclusion, Elon Musk's concerns about SoftBank's financial viability in the Stargate AI project have raised questions about the project's long-term sustainability. While the project has the potential to create jobs and maintain US leadership in AI, financial concerns and competition from China may pose significant challenges. As the project progresses, investors and stakeholders will closely monitor SoftBank's ability to secure the necessary funding and deliver on its ambitious goals.