SpaceX expands Colossus 2 AI computing complex in Memphis with two new sites
SpaceX is scaling its Colossus 2 AI computing complex in Memphis with two additional sites, Gun Range and Spam, aimed at increasing computational power for xAI’s Grok project. The expansion underscores SpaceX’s rapid growth in AI infrastructure but faces legal and community opposition.
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30 SEC SUMMARY
- SpaceX is expanding its Colossus 2 AI computing complex in Memphis with two new sites, Gun Range and Spam.
- The expansion aims to boost computing power for Grok, xAI’s AI project, with Gun Range set to launch by November and Spam by December.
- SpaceX raised $40 billion in debt to purchase AI chips, and its AI business recently surpassed Starlink in revenue.
- Legal disputes persist, including an NAACP lawsuit over unpermitted methane gas turbines powering the data centers.
TABLE OF CONTENTS
KEY HIGHLIGHTS
- SpaceX is adding two new sites, Gun Range and Spam, to its Colossus 2 AI computing complex in Memphis.
- Gun Range is expected to be operational by the end of November, with Spam following in December.
- The Spam site previously stored Hormel products, while Gun Range was once owned by the local police department.
- Colossus 2 is designed to enhance computing power for Grok, xAI’s AI project.
- SpaceX raised $40 billion in debt to acquire AI chips, and its AI revenue exceeded Starlink’s last quarter.
- The NAACP has sued xAI and MZX Tech, alleging unpermitted methane gas turbines power Colossus 2 in Southaven, Mississippi.
Two new sites to power Grok
SpaceX is adding two sites, Gun Range and Spam, to its Colossus 2 AI computing complex in Memphis. The expansion is intended to increase computing power for Grok, xAI’s AI project.
According to reporting by The Next Web, Gun Range is slated to become operational by the end of November, with Spam following in December. The Spam site previously housed Hormel products, while the Gun Range location was once owned by the local police department.
Colossus 2 builds on the first Colossus supercomputer, which SpaceX constructed in Memphis earlier this year. xAI initiated the Colossus 2 project last year to support Grok’s computational demands.
Funding and revenue growth
SpaceX has raised $40 billion in debt to purchase AI chips, a significant investment in scaling its AI infrastructure. Last quarter, the company’s AI business surpassed Starlink in revenue, reflecting its growing focus on AI-driven projects.
Legal and community challenges
The expansion has faced resistance from Memphis residents, who have protested the Colossus 2 campuses. Legal disputes have also emerged: in April, the NAACP sued xAI and its subsidiary MZX Tech, alleging the operation of unpermitted methane gas turbines at the Southaven, Mississippi, facility powering Colossus 2.
A US district judge recently rejected a bid to dismiss the NAACP’s case, allowing the lawsuit to proceed.
Related context
SpaceX’s push into AI infrastructure follows its broader ambitions in technology and telecommunications. Earlier reporting revealed negotiations with Boost Mobile to challenge US carriers, signaling its intent to diversify beyond aerospace and satellite internet.
Legal challenges like the NAACP lawsuit are not new for SpaceX’s data center projects. A federal judge previously denied xAI’s motion to dismiss a similar case, indicating regulatory scrutiny of its environmental and permitting practices.
What this means
Lazyfounder analysis — our interpretation, not reported fact.
SpaceX’s expansion of Colossus 2 reflects its determination to compete in the AI infrastructure space, where cloud providers and specialized AI startups are racing to build high-performance computing clusters. For founders, the project offers lessons in both opportunity and risk: while repurposing existing facilities can accelerate deployment, regulatory and community pushback can delay or derail even well-funded projects. The legal dispute over methane gas turbines also underscores the importance of compliance for startups scaling energy-intensive operations, particularly in industries under environmental scrutiny.
Key takeaways
- This expansion signals SpaceX’s aggressive push into AI infrastructure, directly competing with cloud providers and AI-focused data center operators.
- The legal challenges highlight regulatory and community risks for startups scaling energy-intensive AI infrastructure in the US.
- The repurposing of existing facilities for AI computing may offer a model for cost-effective expansion, relevant for startups facing high infrastructure costs.
Related on Lazyfounder
Sources
- The Next Web · 2026-11-02
Musk says Colossus 2 is expanding into sites called Spam and Gun Range
This story is an original summary drafted with AI by Lazyfounder from the reporting listed above and checked by automated validation. Facts are attributed to their original publishers; sections marked as analysis are Lazyfounder's. Where a source is in another language, facts were machine-translated and quotations are reported, not reproduced. Read the original coverage via the links, and see our AI policy and corrections policy.
About the author
Editor, Lazyfounder
Tarun Mottlia edits LazyFounders, covering Indian startups, funding rounds, AI and product launches. Every story on the site is AI-assisted and checked against its cited sources before publication.
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