The world’s richest man spent at least $446m backing Republicans, but Democrats won every Senate race his main political group targeted most heavily. Shares in his companies fell sharply as markets digested the result.
Elon Musk spent a record sum backing Republicans in the US midterm elections, but the candidates he supported most heavily lost, and shares in his companies fell sharply as markets reacted to the Democrats’ sweep.
The SpaceX and Tesla chief executive gave at least $446m to Republican-aligned super PACs and groups, according to campaign finance records, far more than the nearly $290m he spent in 2024.
Democrats won all five Senate races where Musk’s America PAC spent the most money backing Republicans: Texas, Michigan, Maine, Ohio and Iowa, according to US media projections.
Texas, where Musk’s businesses are based, was the centre of his effort. Republicans lost the Senate race and the governor’s office there, and are expected to lose control of the state House.
America PAC spent at least $28m on adverts and messaging against Democrat James Talarico, who beat Republican Ken Paxton for the Senate seat. Talarico is the first Democrat to win a Senate race in Texas since 1988.
Musk also repeatedly attacked Talarico on X, his social media platform, warning in the closing days of the campaign that he would “open the borders”.
“We just proved that all the money in the world is no match for the people of Texas,” Talarico said in his victory speech in Austin, adding that “power belongs to the people”.
He said he had raised $155m for his campaign, mostly from individual donors, and has promised to ban super PACs and political pardons.
Musk’s donations flowed into at least eight Republican-aligned super PACs. The largest sum, at least $216m, went to his own America PAC, while $168m went to the Senate Leadership Fund, which backed candidates including Paxton.
The spending helped make several contests among the most expensive in US history, and is likely to set a benchmark for the 2028 presidential race.
On X, Musk responded to the results with jokes. “Guess my election-interfering space lasers didn’t work this time,” he wrote. He later added: “Data centres in space looking pretty appealing right now.”
Shares in SpaceX fell more than 7% in early trading on Thursday, while Tesla dropped more than 9%. The tech-heavy Nasdaq Composite was down more than 5% at one point.
Investors are reacting to the prospect of tougher scrutiny of data centres and the AI industry after Democrats won in key data centre states, including Texas.
Chip stocks have been hit hardest over the past five days. AMD has fallen nearly 17%, Micron more than 20%, Intel more than 18% and Nvidia more than 10%, while the Philadelphia Semiconductor index is down more than 13%.
Some investors were already worried that AI shares could be in a bubble due for a correction.
Texas governor-elect Gina Hinojosa and the state’s new agriculture commissioner, Clayton Tucker, both campaigned for a moratorium on new data centres until more research on their impact has been done. Both are the first Democrats in their posts for decades.
Hinojosa has also been in a legal battle to see unredacted emails between Musk and the office of outgoing Governor Greg Abbott.
Exit polling suggested that 57% of voters nationally saw AI and data centres as a crucial factor in their vote, and that two-thirds of those voters backed Democrats.
Tech leaders admitted they had been caught off guard. “You can’t just tweet and say: ‘This is going to be good.’ You need to be in those communities,” OpenAI president Greg Brockman told a technology conference in California on Wednesday.
Dina Powell McCormick, Meta’s president, said the industry needed to “double and triple down on telling the story” of AI’s benefits.
With Democrats set to control both houses of Congress, Musk faces the prospect of investigations.
House Democrats have called for inquiries into his conduct while leading the Department of Government Efficiency, or Doge, last year, and have vowed to scrutinise federal funding for his companies. Some Democrats have also said they want to examine any role he played in the Starlink speed limits imposed on Ukraine’s military in October.
Robert Garcia, a senior Democrat on the House Oversight Committee, warned Republicans to “lawyer up”. Senator Ed Markey said tech executives would “need to plant new forests for all of the subpoenas we’ll be printing”.
Musk’s companies have benefited from federal contracts and a light-touch approach to regulating AI under the Trump administration, and from a business-friendly environment in Texas. Talarico has said wealthy corporations should pay more tax.