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SpaceX won’t remove all of xAI’s unpermitted turbines for another year
8:16 AM PDT · July 31, 2026
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SpaceX said on Thursday that it will remove the unpermitted turbines powering its xAI data centers near Memphis as it transitions to a permanent, 1.2 gigawatt natural gas power plant.
The turbines won’t be completely removed until July 2027, though. SpaceX said that it’s currently operating 69 gas turbines to power the Colossus data centers, of which many have been operating for months. The NAACP and Southern Environmental Law Center have sued xAI over the use of unpermitted turbines.
SpaceX acquired xAI in February. In its IPO filing, SpaceX said it plans to buy $2.8 billion worth of gas turbines for its data centers over the next three years.
The company claims that it is allowed to operate the existing turbines without permits because they remain on the trailers they were shipped on. But federal regulations say that the turbines xAI has been using, regardless of what they sit on, require permits because of their size and how they’re being used.
The turbines are currently located south of Memphis in Mississippi, just over the border with Tennessee. The region is among the most polluted in the U.S., and xAI has been operating gas turbines that have the potential to emit more than 2,000 tons of smog-forming NOx per year.
Last month, the Department of Justice sided with SpaceX in the NAACP’s lawsuit, saying the unpermitted turbines were a matter of “national, economic, and energy security.”
The new power plant that SpaceX is building will consist of 41 gas turbines ranging in size from 16.48 megawatts to 50 megawatts, according to permit documents issued by the state of Mississippi. They appear to be different from those currently in use, though TechCrunch could not verify the specific models of the 69 existing turbines.
Sam Altman isn't the only one who wants to pump the brakes on AI | Equity Podcast
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Earlier this year, Elon Musk bought APR Energy, a company that specializes in temporary natural gas power. Based on an archive of the company’s site before it was taken down, the turbines in the company’s fleet also appear to be different from those cited in permits for the new, permanent power plant.
Given that APR Energy’s turbines aren’t likely to be part of the new Colossus power plant, the new turbine fleet is likely intended for another, unannounced project.
Topics
AI, air pollution, Climate, data centers, SpaceX, xAI
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Tim De Chant
Senior Reporter, Climate
Tim De Chant on TwitterTim De Chant on BlueskyTim De Chant on Linkedin
Tim De Chant is a senior climate reporter at TechCrunch. He has written for a wide range of publications, including Wired magazine, the Chicago Tribune, Ars Technica, The Wire China, and NOVA Next, where he was founding editor.
De Chant is also a lecturer in MIT’s Graduate Program in Science Writing, and he was awarded a Knight Science Journalism Fellowship at MIT in 2018, during which time he studied climate technologies and explored new business models for journalism. He received his PhD in environmental science, policy, and management from the University of California, Berkeley, and his BA degree in environmental studies, English, and biology from St. Olaf College.
You can contact or verify outreach from Tim by emailing tim.dechant@techcrunch.com.
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Investors love AI, as long as you’re a cloud host
3:41 PM PDT · July 30, 2026
Amazon reported better-than-expected second-quarter earnings on Thursday, and investors loved what they saw. Net sales rose 20%, and cloud revenue stood out as a particular bright spot. This combination of positive results was enough to send Amazon’s stock up nearly 10% in after-hours trading.
Crucially, Amazon isn’t slowing down on data center spending, despite the conventional wisdom that investors want companies to rein it in.
One line item, in particular, illustrates Amazon’s appetite for investing in infrastructure. Amazon spent $173 billion for the fiscal year ended June 30 on property and equipment — a category that covers GPUs, natural gas turbines, and plots of land — up from $107.65 billion from the year before.
It also raised its 2026 capex forecast from $200 billion to $220 billion — even as it has begun dipping into its cash reserves to help cover the cost. The company ended the quarter with $7.6 billion less cash than it had 12 months ago, marking its first period of negative free cash flow this year.
Under normal circumstances, ballooning expenses would be a tough pill for investors to swallow. But Amazon has a revenue engine that helps justify the spending. AWS revenue rose 37% year over year, clocking $42 billion for the quarter. That’s not enough to balance out the capex spending in raw arithmetic, but it shows that demand is growing alongside supply. Given the years-long time lag between breaking ground on a data center and selling its capacity, that’s reassuring for investors.
Critically, Amazon’s AI play isn’t limited to building large data centers. The company is also making serious long-term bets on chips like the Trainium and Graviton processors. Those projects don’t show up in capex numbers, but they can meaningfully improve margins for the company’s cloud business.
“We see the AI business following very much the same margin trajectory we saw in the core business before,” Jassy said during the company’s Q2 earnings call. “AWS and Amazon Bedrock can have a wildly successful business without its own frontier model, and the reason is that there’s not going to be a single model to rule them all.”
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This dynamic isn’t unique to Amazon. We saw similar patterns at Microsoft and Google, whose shares also popped after reporting strong cloud revenue. By the same token, companies like Meta which have significant capex and no clear revenue source, are still experiencing intense skepticism from investors. Meta’s stock fell 8% after reporting quarterly earnings this week, as investors focused on its cash flow crunch and continued spending.
Of course, investors like revenue and don’t like expenses — that’s how markets work. But it’s important not to miss the broader lesson about the AI economy. Right now, investors are treating cloud hosts as the most reliable part of the AI stack, while remaining skeptical about the underlying economics for AI labs and AI startups.
But Amazon’s hosting revenue is someone else’s AI bill. In Anthropic’s case, it’s literally the same money.
If that spending isn’t sustainable for the big labs and their clients, the revenue won’t be stable for Amazon and the other cloud hosts. There’s real competition and differentiation at every level of the stack, but if demand for AI doesn’t hold up, it’s going to be a bad time for everyone.
In the end, it all comes back to David Cahn’s $3 trillion question. There’s either enough demand to justify this buildout or there isn’t. Cloud-hosting services like AWS may be a few steps removed from that demand problem, but that doesn’t mean they’re insulated from it.
Correction: An earlier version of this piece inaccurately referred to Amazon’s Tranium chip as a TPU; in fact, it is a purpose-built AI processor. TechCrunch regrets the error.
Topics
AI, Amazon, Cloud Computing, earnings, TC
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Russell Brandom
AI Editor
Russell Brandom has been covering the tech industry since 2012, with a focus on platform policy and emerging technologies. He previously worked at The Verge and Rest of World, and has written for Wired, The Awl and MIT’s Technology Review. He can be reached at russell.brandom@techcrunch.com or on Signal at 412-401-5489.
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Image Credits: Commonwealth Fusion Systems
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Fusion power darling Commonwealth Fusion Systems raises another $1B
8:17 AM PDT · July 30, 2026
Commonwealth Fusion Systems (CFS) has long been the best-funded fusion power startup. Now, it’s extending its lead.
CFS announced Thursday that it raised $1 billion in a new round that included “significant institutional investors, such as pension funds, sovereign wealth funds, and infrastructure and industrial corporate partners,” the company said. When asked by TechCrunch, the company declined to name the specific investors. To date, CFS has raised $4 billion.
The funding arrives as the company’s spending ramps up. CFS is currently building Sparc, its demonstration reactor, and finalizing the design of Arc, its first commercial power plant.
The company said the new funding will go toward commercializing fusion, and CEO Bob Mumgaard has hinted that CFS will continue to raise more capital.
CFS hasn’t disclosed either Sparc’s or Arc’s price tag, though in 2024, Virginia’s former governor Glenn Youngkin said that Arc would be a “multi-billion-dollar fusion power plant.”
This is CFS’s largest round since raising $1.8 billion in 2021. The startup’s previous fundraise, announced in August, added $863 million to its coffers and included Nvidia, Google, Khosla Ventures, and Breakthrough Energy Ventures among its investors.
CFS is pursuing a form of fusion known as magnetic confinement, in which powerful magnetic fields confine plasma inside the reactor, keeping the plasma dense and hot enough to spark fusion reactions. When atomic nuclei from the fusion fuel fuse, the reaction releases enormous amounts of energy. CFS plans to harvest the heat thrown off by the reaction to power a steam turbine.
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The company has made significant progress on its Sparc reactor, which it now expects will achieve scientific breakeven in 2027.
Scientific breakeven is a key milestone at which fusion reactions release more energy than the reactor consumes to ignite them. It’s not enough to generate electricity for export to the grid, but hitting the mark will show investors that CFS’s approach is likely to bear fruit. To date, only one fusion device, at the Lawrence Livermore National Laboratory’s National Ignition Facility, has achieved scientific breakeven.
Alongside work on Sparc, CFS has been finalizing the design for Arc, the commercial-scale power plant planned for Virginia. Italian energy company Eni said it will buy more than $1 billion worth of electricity from Arc, while Google has committed to buying 200 megawatts of electricity, or half of Arc’s total output.
Topics
Climate, Commonwealth Fusion Systems, fusion power, nuclear fusion, Startups
When you purchase through links in our articles, we may earn a small commission. This doesn’t affect our editorial independence.
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Tim De Chant
Senior Reporter, Climate
Tim De Chant on TwitterTim De Chant on BlueskyTim De Chant on Linkedin
Tim De Chant is a senior climate reporter at TechCrunch. He has written for a wide range of publications, including Wired magazine, the Chicago Tribune, Ars Technica, The Wire China, and NOVA Next, where he was founding editor.
De Chant is also a lecturer in MIT’s Graduate Program in Science Writing, and he was awarded a Knight Science Journalism Fellowship at MIT in 2018, during which time he studied climate technologies and explored new business models for journalism. He received his PhD in environmental science, policy, and management from the University of California, Berkeley, and his BA degree in environmental studies, English, and biology from St. Olaf College.
You can contact or verify outreach from Tim by emailing tim.dechant@techcrunch.com.
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