Musk loses billions in net worth after backing failed Republican campaigns

One of the first things Elon Musk said after the midterms result was not about what it meant for his on-and-off friend Donald Trump, but about data centres.

"Data centres in space looking pretty appealing right now," he wrote on X, about an hour after the Democrats' sweeping victory was called.

The cryptic comment was likely a reference to several big tech-friendly Republican seats that flipped to the Democrats, despite having millions of Musk's dollars behind them.

Nowhere were his losses greater than in Texas, where the trillionaire poured about $US212 million ($302 million) into the failed campaign of Republican Senate candidate Ken Paxton.

According to The New York Times, Musk donated another $US12.3 million ($17.74 million) to Texas political groups. Added together, it was almost half of his total donations during the 2026 midterms cycle.

Texas is where Musk lives (on a compound outside Austin) and is home to the corporate headquarters of Tesla and SpaceX.

The state also accounted for 25 per cent of the US's planned data centre capacity, according to investment bank Goldman Sachs.

But that idea may now be dead in the water after voters overwhelmingly voted blue in the long-time red stronghold, installing a Democrat governor and senator who campaigned heavily against data centres.

Governor-elect Gina Hinojosa, who beat the Republican incumbent Greg Abbott, promised to ban all data centre approvals until the state had passed laws to "to protect Texans, so that Texans have a seat at the table to decide if and how data centres come into our community".

James Talarico, who beat Paxton in the Senate race by a stunning 12 points, pledged to "rein in" the industry by scrapping tax breaks for developers and forcing them to pay for their own energy and water.

He also promised to push for the creation of an "AI dividend" for Americans to share in AI companies' profits.

"What I want to ensure is that it is a two-way street, because right now a lot of these giant data centre companies are running over local communities … popping up in people's backyards and there's no input," he said in the lead-up to the election.

That anti-data centre sentiment was shared by millions of Americans at this year's midterms.

An NBC News exit poll found a majority of voters said AI and data centres were a crucial or major factor in their vote for Congress.

More than three in four voters said they were against data centres being built in their community, the poll found.

Alongside the governor, Senate and House elections, some states also held ballot measures, which allowed voters to have their say on specific issues.

Of the 41 ballot measures about data centres put to voters in 10 states, all but one are on track to be defeated.

In Ohio, where more than half of the data centre ballot measures were held, Sherrod Brown flipped a Senate seat in favour of the Democrats after framing his Republican opponent as the "face" of the industry.

Throughout his campaign, he pointed to $US2.5 billion ($3.6 billion) in tax breaks for 226 data centres built across the state in seven years. Republican incumbent Jon Husted supported the tax incentives during his time as lieutenant governor.

Husted was another Republican candidate who lost despite Musk's financial backing, as was Mike Rogers in Michigan, who polled seven points behind Democrat progressive Abdul El-Sayed.

In fact, the Democrats won all five Senate seats that Musk's political action organisation, America PAC, had invested the most in keeping red.

The NYT reported Musk spent about $US474 million ($684 million) at this year's midterms, more than any donor has ever spent in a single election cycle.

But ultimately, that figure is a pittance to the world's richest man — the equivalent of a millionaire contributing $US400 ($477), according to the Financial Times.

As the opposition's sweeping victory became clear earlier this week, Musk joked on X that his "election-interfering space lasers didn't work".

But other than that and his tweet about building data centres in space, Musk was unusually quiet online on election night, posting mostly about his company's AI agent, Grok Bot.

He even deleted an earlier post that said "Vote red today", multiple US media outlets reported, and removed an October 29 post he had pinned to the top of his profile that warned against a Democrat election victory.

Global tech stocks plummeted on Thursday after the midterm elections, with Tesla falling nearly 11 per cent and SpaceX by 9 per cent. Musk himself lost $US45 billion ($65 billion) of his net worth, according to Forbes.

Analyst Jake Dollarhide, the head of Oklahoma-based Longbow Asset Management, said he expected a slowdown in the "wild, wild west growth figures" of the industry Musk reigns over, as Democrats work to lower cost-of-living pressures.

"A Democratic sweep of Congress would put pressure on tech and potentially bring regulatory pressure on everything AI," he told Reuters.

"Musk was the Hail Mary for Republicans leading down to the wire.

"Unfortunately, his large infusion of cash to back red states could not overcome higher utility bills, prices at the grocery store and prices at the gas pump."