SpaceXAI is focusing on expansion of its Colossus 2 data center across two additional campuses in Southaven, Mississippi. CEO Elon Musk announced the sites, dubbed Gun Range and Spam, in reference to their former uses. Both should run by the end of the year.
Gun Range sits on a 55.9-acre parcel that once held a police and fire training center. It will host two single-story buildings and a high-performance AI training cluster. Spam occupies 53 acres and reuses a warehouse that once stored products from Hormel Foods, the maker of Spam. Musk said the company is optimising it for inference work.
The two campuses will hold approximately 420,000 Nvidia GB300 GPUs between them, according to Musk. “I walked the whole Colossus 2 site around midnight and again this morning. Good progress by the SpaceX team and contractors,” he wrote on X. “Gun Range is tracking to be operational by end of November and Spam in December.”
Other Projects
The advancements of data centers are continuously relying on the advancement of power projects as well such as the Long Matt SMR Generating station. The $2.4 billion Long Mott Generating Station Plant in Texas has moved to the final permitting stage. The US Nuclear Regulatory Commission released its Final Safety Evaluation Report for the project. Consequently, a construction permit announcement is expected soon. The safety review covered the Xe-100 plant’s principal design criteria, preliminary design and safety analyses. It also examined the probabilistic risk assessment and research programmes. NRC staff concluded that the proposed plant and site provide the safety basis to begin construction under US nuclear regulations.
Scope of implementation on the Colossus 2 data center expansion
The new sites join three existing Colossus 2 locations named Macrohard, Macroharder, and Minihard. Musk has assigned them 330,000, 220,000, and 220,000 GPUs respectively. He said roughly 1.2 million Blackwell GPUs in total will run at Colossus 2 by the end of 2026.
The build-out forms part of a cluster that keeps growing. SpaceXAI announced its third data center, also in Southaven, in January 2026. In March, the company filed a construction permit for a $659 million building on an adjacent parcel. Minihard followed in July 2026, rising on Tulane Road near the Tennessee border.
The portfolio started in Memphis in 2024. SpaceXAI launched Colossus inside a former Electrolux factory in the Boxtown district. The company bought the Colossus 2 site in March 2025, and the facility came online in January. Musk claimed it offered 1GW of capacity at launch. However, Tom’s Hardware reported that satellite imagery from January showed cooling equipment for only 350MW.
Challenges facing the Colossus 2 data center expansion
Regulators are circling the cluster. Last month, the Mississippi Department of Environmental Quality issued a notice alleging that “disturbing construction activities at sites occurred prior to coverage under Mississippi’s Large Construction Stormwater General Permit.” The notice went to MZX Tech LLC, a SpaceXAI subsidiary, and seeks civil penalties of up to $25,000 per day, with claimed exposure of approximately $6.1 million across three sites. SpaceXAI said it is cooperating and negotiating a single agreed order.
Meanwhile, a judge rejected the Justice Department attempt to block an NAACP lawsuit over the Southaven gas-fired power plant. The group alleges SpaceXAI built and ran the plant without permits. It also counts 57 illegally installed gas turbines. In its filing, the NAACP wrote that “the Colossus Gas Plant emits significant amounts of harmful pollutants, including nitrogen oxides (“NOx”) and formaldehyde, which are tied to increases in asthma, respiratory diseases, heart problems, and certain cancers in persons exposed to them.”
The turbine record complicates the defence. The company once ran as many as 35 turbines without a permit through a Clean Air Act loophole. Local regulators granted a permit for 15 turbines in 2025, running until 2027.
Outlook for the Colossus 2 data center cluster
Commercially, the expansion supports a new rental business. In recent months, SpaceXAI has signed major compute agreements with Reflection, Anthropic, and Google. Per DCD, Google will pay $920 million monthly for AI capacity.
Both campuses therefore carry weight beyond GPU counts. They must open on schedule, satisfy regulators, and outlast the court fight.
Project Overview
- Permit Value: $659 million adjacent development
- Location: Southaven, Mississippi
- Developer: SpaceXAI
- Status: Two campuses near completion
Scope
- Gun Range: two buildings, 55.9 acres
- Spam: one warehouse, 53 acres
- Roughly 420,000 Nvidia GB300 GPUs
- Training and inference workloads split
Project Highlights
- About 1.2 million GPUs by end 2026
- Five campuses in Colossus 2 cluster
- Former industrial sites repurposed
- Inference capacity added at Spam
Key Developments
- Colossus launched Memphis in 2024
- Colossus 2 online January 2026
- Third data center announced January 2026
- Gun Range and Spam due by December
Key Challenges
- MDEQ seeks up to $6.1 million
- NAACP lawsuit over gas turbines
- 1GW claim contested by imagery
- Permit covers only 15 turbines
Outlook
- Gun Range operational by November
- Spam operational by December
- Compute rentals expand to third parties
- Regulatory cases still unresolved
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