SpaceX's $15.8 Billion AI Spending Shakes Investors Despite Strong Revenue in First Public Earnings

SpaceX spooks investors with debut earnings report

SpaceX shares dropped on Wednesday after Elon Musk's plans for blockbuster spending to position his AI and rocket company as a data center developer spooked investors. SpaceX surpassed analysts' expectations in Tuesday's debut earnings report, posting quarterly revenues of $7.8 billion, well above analysts' estimates of $6.82 billion and up 92 percent from a year earlier. It posted a net loss of about $541 million, better than estimates of $2.12 billion. But shares in SpaceX fell 10 percent in early trading after it reported capital expenditure of almost $16 billion on AI, double the previous quarter and well above Wall Street's expectations. It said spending would persist at current levels for at least two more quarters. The earnings report comes after SpaceX raised $86 billion in a historic initial public offering in June that was underpinned by expectations that it will generate meteoric revenue growth in coming years. SpaceX's shares initially surged but they have shed around half their value, from a peak of $225 in the week after going public to $112 on Wednesday. Musk told investors on an earnings call that the group planned to increase its computing capacity from 2 gigawatts at the end of this year to "closer to 10GW [than 5GW]" by the end of 2027. Each gigawatt of new capacity costs tens of billions of dollars to develop, with the bulk of that spent on chips. Musk announced that he would rely exclusively on Nvidia hardware in future infrastructure development. At the highest end of Musk's estimate, the company's data centers would be consuming as much power as New York City at the peak of summer by the end of 2027. Musk, whose commercial success at Tesla and SpaceX has come from developing hardware, is betting that his company can capitalize on insatiable demand for computing power. Bret Johnsen, SpaceX's chief financial officer, told investors that the group would generate more than $100 billion in annual recurring revenue by the end of the year, with cloud services accounting for the bulk of its growth. "I think what the investment community wasn't overly excited about was the capex number in the AI segment," said Melissa Otto, global head of Visible Alpha research at S&P Global. "It's ambitious." SpaceX's AI revenue more than trebled from the previous quarter to $2.56 billion, with the majority of that coming from deals to lease data center capacity to rival AI groups including Anthropic and Google. That approach has boosted SpaceX's short-term revenues while limiting its capacity to train and run its own competitive AI models. Dec Mullarkey, managing director of SLC Management, said SpaceX's data center leasing could hamper it. "Their margins are going to be capped if they are primarily a cloud company," he said. SpaceX's $1.65tn market capitalisation also hinges on Musk achieving ambitious goals such as reaching Mars with reusable rockets, putting data centers into orbit and playing a critical role in developing AI. Goldman Sachs, a bookrunner on SpaceX's offering, expects the company's AI revenue to increase 100-fold by 2030. Musk said on Tuesday that SpaceX could hit $1tn in revenue by the end of the decade. On the earnings call, Musk said SpaceX had made progress on its first generation of orbital data centers, dubbed Starmind AI-1. "This is not some sort of far-future, distant thing. We expect to start launching these next year." The latest series of Grok AI models are being trained on SpaceX data, which Musk said would give his company's tools an edge in engineering. Musk also argued that the potential of the group's Starlink unit -- which provides satellite internet -- was "under-appreciated." Some traders have been putting on bets against SpaceX shares in recent weeks. Short interest in the company has risen to the equivalent of 220 million shares, or roughly 34 percent of the shares that are freely trading, according to data provider S3 Partners. Analysts at Deutsche Bank said the end of the stock's initial lock-up period for employees on Thursday was weighing on SpaceX's equity price. The German bank also said "lower than expected" buying by passive funds that track indices was affecting SpaceX's shares after it was added to the Nasdaq 100 index last month. Investors are also weighing the probability of Musk merging SpaceX with Tesla after previously consolidating parts of his business empire. Musk said the electric-car maker was increasingly collaborating with SpaceX, including through Terafab, a semiconductor manufacturing initiative, during Tesla's earnings call last month. He added that any merger would have to take place under the "appropriate process."

SpaceX's Future Plans Hinge Heavily on Starlink and Grok - CNET

Tyler is a writer for CNET covering laptops and video games.... Read full bio SpaceX hosted its first-ever public earnings call since its record-breaking IPO on Tuesday. And while billionaire CEO Elon Musk spun a web of lofty promises (as he is wont to do) about a future moon catapult and a space-based economy, it seems the company's more practical businesses are the immediate focus now that it has a responsibility to shareholders. The future of SpaceX is directly tied to its satellites and large language models. SpaceX's Starlink connectivity business, AI data centers and future Grok models are the primary focus over the next year of business, as they generate the greatest amount of revenue for the company. The Starship and Falcon rockets received far less time in the spotlight. Since its founding, SpaceX has never posted a profit. The company's massive valuation is based on ballooning revenue projections for the next half-decade of operations. Now that public investors have entered the picture, it's becoming more important to actually deliver on some of these promises sooner rather than later. Musk's big numbers and lofty promises During the earnings call on Tuesday, Musk threw out a whole bunch of big numbers and vague promises about how SpaceX plans to expand its Starship, Starlink and AI businesses over the next 10 years. By his own admission, many of the rapid-fire claims Musk listed during the earnings call sounded "super sci-fi" and "totally nuts," especially when he started talking about building a hardware catapult on the moon. It's always good to take Musk's promises with a shaker's worth of salt. But sifting through the billionaire's lofty promises still usually reveals a kernel of truth about the direction his companies are heading, even if the final product never comes to fruition. Musk reiterated that SpaceX's Starship and Falcon projects are important to the company. The CEO said he wants the company's rockets to deliver 10 million tons of hardware into orbit per year, though he didn't provide a timeline for that goal. SpaceX rockets currently deliver 2,500 tons of hardware into orbit per year, according to Musk. But the lion's share of his prepared statement focused on Starlink V3 satellite technology and future Grok AI capabilities, echoing the more grounded financial realities espoused by SpaceX's other key executives during the call. Musk said the latest generation of Starlink satellites is 10 times more capable than the V2 satellites, but didn't provide any specific performance metrics. He said that SpaceX expects to launch 10 times as many V3 satellites, which "would mean a roughly two-order-of-magnitude increase in delivered bandwidth." Within the next decade, Musk said, "Starlink will deliver a majority of the world's internet, at least in countries where [SpaceX] is allowed to operate." It's a bold prediction without much backing, despite the fact that the service reached its 12 million subscriber milestone this quarter. Musk said SpaceX's physical computing power -- its AI data centers and the supercomputers housed within them -- is being built out and deployed faster than competitors and that the company is "providing compute to others," likely referring to the data center deal inked between SpaceX and Anthropic. SpaceX expects to end the year with over two gigawatts of computing capacity, but Musk initially said during the call that the company will end 2027 with "closer to 10 gigawatts of compute than 5 gigawatts of compute." Later, during the investor Q&A, Musk said the company was aiming to have 15 gigawatts of AI computing capacity online by the end of next year. Grok AI is also an outsized focus for SpaceX, even amid litigation surrounding the LLM's reported creation of more than 4.4 million nonconsensual sexual images. Musk said that two more Grok models would launch within the next two months, after which he promised that the company would dramatically improve its AI development cadence. According to Musk, Grok 5 will come out sometime this year. Musk told one investor that the expected timeline for SpaceX to reach $1 trillion of yearly revenue has been moved up from 2031 -- he now believes that figure could be achieved as early as 2029. That claim would require the company to achieve unseen exponential growth numbers to come true. Though Musk's specific claims are dubious at best, SpaceX is definitely adding a lot of hardware to its balance sheet and creating avenues to earn additional money. The here and now: How is SpaceX making money? SpaceX president Gwynne Shotwell and chief financial officer Bret Johnsen shared details about Starlink and Grok's revenue numbers and performance metrics. While the combined yearly revenue of all of SpaceX's business tallies up to roughly $7.8 billion, the aerospace and AI units are operating at a loss. SpaceX's connectivity business is the only part of the company to turn a profit -- Starlink brought in $1.66 billion more than it cost to operate this year. Connectivity growth was due to record Starlink subscriber numbers as well as a "sharp increase in enterprise and government revenue," according to Johnsen. Starlink added more than 1.7 million new subscribers during this quarter, a figure representing over 10% of the service's total customers. SpaceX will likely try to ink more contracts with corporations and governments for internet service in the near future. "We believe revenue from these [enterprise] markets has the potential to reach a scale at least comparable, but likely to exceed our consumer business as we continue to gain market share," Shotwell said. She pointed to recent airline partnerships as examples of the type of deals SpaceX will continue to pursue. Shotwell said the planned rollout of Starlink Mobile next year will make the company's connectivity segment even more financially viable. "The big three [mobile providers] in the United States, AT&T, Verizon and T-Mobile, make roughly $600 billion between them a year," said Shotwell. "I anticipate us to be able to acquire quite a few of their customers because I think our service will be better." Despite the controversies surrounding xAI and the net losses incurred by SpaceX's AI unit, Grok is another of the primary driving forces behind SpaceX's revenue growth. Johnsen said X subscriptions have increased as more people adopt Grok into their daily activities. It's still unclear how SpaceX plans to make its AI unit profitable, despite the fact that Musk told an investor that he thinks his models will be able to handle any digital job by the end of next year. If the company decides to pivot in the future, however, its physical computing capacity might be leveraged to create another stream of revenue in a deal not dissimilar to the one SpaceX struck with Anthropic. The future of SpaceX The first SpaceX earnings call provided a much clearer path forward for the company. While its IPO valuation largely hinged on Musk's cult of personality and ambitious plans for a mission to Mars, immediate investment in satellites and AI hardware put some grounded physical assets on the balance sheet. Despite bringing in $2.56 billion in revenue, SpaceX's AI unit has bled $1.26 billion so far this year. That loss alone accounts for more than 75% of Starlink's yearly profits. Now, SpaceX is becoming increasingly ingrained in the circular AI economy. During the call, Musk announced that all of his company's future AI computing power will be derived from Nvidia hardware. A partnership with what is potentially the linchpin company for the AI industry indicates that SpaceX's AI spending will only ramp up in the coming years.

SpaceX slides as AI spending worries overshadow early returns

SpaceX's first earnings call today really affirmed that the company is very serious about all the plans that it wants to do in the artificial intelligence sector with building data centers. More Videos 0 of 1 minute, 58 secondsVolume 0% Press shift question mark to access a list of keyboard shortcuts Keyboard ShortcutsEnabledDisabled Shortcuts Open/Close/ or ? Play/PauseSPACE Increase Volume↑ Decrease Volume↓ Seek Forward→ Seek Backward← Captions On/Offc Fullscreen/Exit Fullscreenf Mute/Unmutem Decrease Caption Size- Increase Caption Size+ or = Seek %0-9 Next Up How the Iran war threatens global airlines Subtitle Settings OffEnglish Font Color White Font Opacity 100% Font Size 100% Font Family knowledge-bold Character Edge None Edge Color Black Background Color Black Background Opacity 85 Window Color Black Window Opacity 0% Reset WhiteBlackRedGreenBlueYellowMagentaCyan 100%75%50%25% 200%175%150%125%100%75%50% ArialCourierGeorgiaImpactLucida ConsoleTahomaTimes New RomanTrebuchet MSVerdana NoneRaisedDepressedUniformDrop Shadow WhiteBlackRedGreenBlueYellowMagentaCyan WhiteBlackRedGreenBlueYellowMagentaCyan 100%75%50%25%0% WhiteBlackRedGreenBlueYellowMagentaCyan 100%75%50%25%0% Auto180p1080p720p576p540p480p360p288p180p 00:02 01:55 01:58 Aug 5 (Reuters) - SpaceX (SPCX.O), opens new tab touted faster-than-expected returns from its AI spending on its first-ever earnings call as a public company. But investors remained concerned about how long its profitable Starlink business could continue to bankroll costly investments in data centers and Nvidia (NVDA.O), opens new tab chips. The company's shares fell 9% in premarket trading on Wednesday, dropping well below their $135 IPO price in less than two months since the company's blockbuster debut. SpaceX reported AI revenue that more than tripled from a year earlier and disclosed several new cloud computing agreements, even as quarterly capital spending on AI climbed to $15.8 billion. Chief Financial Officer Bret Johnsen said the economics of those investments were improving rapidly, but also signaled that AI spending would remain elevated. "The current economics have translated into a less than one-year payback on our ⁠new capital deployments for compute," Johnsen said, adding that SpaceX had signed another $6.7 billion in cloud computing contracts since the end of the second quarter and was on track to reach a $100 billion annualized revenue run rate by the end of the year. That stands in contrast to traditional data center investments, which typically take years to recover their upfront costs. "Elon has continued to surprise investors on what innovation and technology can do, but there has always been a mismatch in terms of the time frame of when that execution is going to occur," David Wagner, portfolio manager at Aptus Capital Advisors, said, referring to Musk's often-rosy outlook at his EV company Tesla (TSLA.O), opens new tab that he has regularly missed. "I believe the numbers. I would say that yes, those numbers are aggressive, but it's not a fantasy. The pieces exist, they just require flawless execution." Item 1 of 2 SpaceX leadership members and guests celebrate on a balcony at the Nasdaq MarketSite on the day of SpaceX's initial public offering (IPO), in New York City, U.S., June 12, 2026. REUTERS/Brendan McDermid/File Photo [1/2]SpaceX leadership members and guests celebrate on a balcony at the Nasdaq MarketSite on the day of SpaceX's initial public offering (IPO), in New York City, U.S., June 12, 2026. REUTERS/Brendan McDermid/File Photo Purchase Licensing Rights, opens new tab THE AI PAYBACK BET The comments at the post-earnings call marked a shift in the investment debate surrounding SpaceX. Before the earnings release, investors largely viewed ⁠Starlink's growing cash flows as the primary source of funding for the company's AI ambitions. Management is now arguing that AI infrastructure itself is beginning to generate enough revenue to finance further expansion. To be sure, the company spent about $18.4 billion on capital expenditures during the quarter, roughly a fifth of the $85.7 billion it raised in its June IPO, and remained deeply free cash flow negative as it continued investing heavily in AI infrastructure. SpaceX's AI business generated $2.6 billion in second-quarter revenue, up more than three-fold from a year earlier although it ⁠remained loss-making on an operating basis. Even so, the company is not easing off its spending. Johnsen said capital expenditures over the next two quarters would likely remain at levels similar to the second quarter as SpaceX continues expanding AI compute capacity, Starship production and next-generation Starlink satellites. "New compute capital monetizes so fast it behaves more like cost of goods than capex," ⁠said Michael Monaghan, portfolio manager of the Founders 100 ETF, which holds SpaceX shares. SpaceX executives said demand for AI computing continues to outstrip supply and that they expect to end the year with more than two gigawatts of compute capacity. If demand remains strong enough to keep that infrastructure fully utilized, AI could increasingly ⁠fund its own growth rather than relying on Starlink's cash generation. "The relationship between capex and revenue is unsustainable, so capex has to fall or revenue has to grow tremendously, and that is where faith in Musk's vision, engineering leadership and execution track record separates the bulls from the bears," said Drew Cupps, portfolio manager at Polen Capital, which holds a position in SpaceX. Reporting by Akash Sriram in Bengaluru; Editing by Sweta Singh and Saumyadeb Chakrabarty Our Standards: The Thomson Reuters Trust Principles., opens new tab * Suggested Topics: * Artificial Intelligence Akash Sriram Thomson Reuters Akash reports on technology companies in the United States, electric vehicle companies, and the space industry. His reporting usually appears in the Autos & Transportation and Technology sections. He has a postgraduate degree in Conflict, Development, and Security from the University of Leeds. Akash's interests include music, football (soccer), and Formula 1.

SpaceX shares upgraded. Argus says AI investments will pay off, and don't bet against Musk

Space Exploration Technologies is likely to continue to bounce back, boosted by its artificial intelligence-focused corporate strategy under CEO Elon Musk, despite investors' handwringing over outsized captial spending commitments, according to Argus Research. SpaceX is up 10% in early trading Friday, and after four straight weekly declines has rallied about 17% in the past five trading days. Argus raised its investment opinion on SpaceX to buy from hold Friday and repeated its 12-month price target of $160, implying 39% upside from Thursday's close. "Despite an outlook for higher-than-expected capital expenditures -- mostly for its AI infrastructure -- we are encouraged by the rapid payback on these investments, given the robust growth in computing capacity," analyst Steve Silver wrote in a report to clients. SpaceX launched its initial public offering at $135 a share on June 15 to much fanfare, gaining 20% in its first day of trading . But, SpaceX plunged 37% in July, and 14% on Wednesday after issuing its first earnings report as a public company. Late Tuesday, SpaceX reported second-quarter earnings and revenue that beat Wall Street expectations, at the same time as it revealed capital expenditures had increased six-fold to more than $18 billion during the same period, largely due to its deepening push into artificial intelligence. Despite the latest rebound, SpaceX was recently trading roughly 50% below its record high of $225.64 hit in mid-June, shortly after the IPO. SPCX mountain 2026-06-16 SpaceX has been cut in half since the mid-June top The Argus analyst noted that looming lockup expirations allowing long-time holders to sell their shares could add more selling pressure. More than 300 million shares could unlock and become eligible to trade later this month, according to a recent SpaceX prospectus. And, several hundred million more shares could become available for sale in September and October, too. But investors should view any near-term pullbacks as buying opportunities, given SpaceX's strong fundamentals, Argus said. "We expect the shares to remain volatile given the initial lockup expiration for insider shares, and expect several additional tranches over the next year," Silver wrote. "Nevertheless, SPCX's strong operational performance in [the second quarter of 2026] and robust growth outlook over the coming years mitigate these factors." The SpaceX "forward multiple has compressed significantly and much faster than we had expected," given the slumping share prices, allowing for a cheaper entry point for would-be SpaceX investors. Argus projects that SpaceX will see revenue more than double in 2026 and 2027, and its shares surge under Elon Musk, going by the entrepreneur's track record at Tesla . "The shares [of SpaceX] merit a BUY rating, in part, based on the track record of Elon Musk's other IPO, Tesla (TSLA). For reference, a $10,000 investment made in TSLA in 2010 is worth $2.5 million today, even after a double-digit decline year-to-date," the analyst wrote. The Argus call matches the Wall Street consensus. Of 36 analysts covering SpaceX, 28 rate it buy or strong buy, LSEG data shows.

SpaceX's first public earnings statement shows the financials of an AI company in 2026 - Engadget

SpaceX has published its first earnings report since going public on June 12. The company's Q2 topline is broadly positive. As a whole, SpaceX increased revenue by 92 percent year-over-year, bringing its total revenue for the quarter to $7.8 billion. The company also shaved the gap between its revenue and operating expenses by more than half, reducing net losses to $541 million, down from $1 billion a year ago. But digging deeper, the financials reveal just how expensive is to run an AI company. Over the past three months, the division previously known as xAI generated $2.56 billion in revenue, an increase of 247 percent from $737 million one year ago. SpaceX attributes that increase primarily to "Cloud Services Agreements" like the highly publicized deals with Anthropic and Google to use its data centers. The company also managed to cut its operating loss to $1.25 billion, down from $1.54 billion. However, SpaceX significantly ramped up CapEx spending. Year over year, that number increased by a whopping 2,013 percent to $15.8 billion for the quarter. For context, the rocket launch part of SpaceX's business by comparison spent a paltry $1.17 on maintaining and improving its fixed assets. While we had an idea of just how expensive it was to run an AI company thanks to reporting from people like Ed Zitron, SpaceX's financials give us our first definitive look at the inside of an AI startup. And keep in mind this is all coming from the company that many consider the fourth horse in the AI race behind Anthropic, Google and OpenAI. Further complicating those numbers is that Anthropic has agreed to pay $1.25 billion per month through May 2029 to use SpaceX's Colossus 1 data center for its compute needs. It will be interesting to see how SpaceX's Cursor acquisition affects the AI division's bottom line when that deal closes sometime this quarter.

SpaceX, in First Earnings After IPO, Reports Soaring AI Spending

Elon Musk's rocket company said its capital expenditures jumped nearly seven times from a year ago. Revenue also rose. SpaceX went public in June in the largest-ever initial public offering, turning its founder Elon Musk into the world's first trillionaire. Since then, the rocket maker has had a rocky ride in the stock market, and Mr. Musk has returned to mere billionaire status, amid questions about the company's spending on artificial intelligence and whether it can achieve its ambitious ideas, such as launching A.I. data centers into space and building a rocket powerful enough to reach Mars. On Tuesday, SpaceX showed just how much it was investing to hit those goals. In its first earnings report as a public company, SpaceX said its capital expenditures jumped to $18.4 billion in the second quarter, up nearly seven times from $2.8 billion a year ago. The spending overshadowed a 92 percent increase in revenue to $7.8 billion. SpaceX also posted a quarterly loss of $541 million, narrower than the $1 billion loss in the same period a year ago. In an investor call, Mr. Musk, who has often made predictions that he does not achieve, doubled down on his bold claims for SpaceX, indicating that the spending was not about to end. He said his company would launch data centers into space starting next year and hastened his timeline for when SpaceX would generate $1 trillion in revenue. "Our internal projects for achieving $1 trillion in revenue have moved up from 2031 to 2030," he said. The results and Mr. Musk's comments sent SpaceX's shares down more than 10 percent in after-hours trading, underlining how drumming up excitement for the company's public offering may have been easier than keeping that excitement going. SpaceX is trying to balance displaying near-term financial progress while spending on its expensive, long-term aspirations of building orbital data centers, factories on the moon and sending humans to Mars. How SpaceX fares on the stock market may affect the A.I. start-ups Anthropic and OpenAI, which have also filed to go public. So far, the rocket company may not be inspiring confidence. In recent weeks, its stock has fallen below its I.P.O. price. More bumpiness may be ahead, when insiders are released on Thursday from a "lockup" period that prevented them from selling their shares, potentially flooding the market with more of the stock. SpaceX is one of several tech giants that are ramping up A.I. spending. This year and next, Amazon, Google, Meta and Microsoft are projected to spend a staggering $1.5 trillion building data centers and stuffing them with advanced chips, according to Wall Street estimates compiled by FactSet. And from April through June, those four companies' capital expenditures totaled $170 billion, up 72 percent from a year earlier. Paul Golding, an analyst at Macquarie, cautioned that people should not read too much into SpaceX's stock performance or its short-term financial results. The focal point, he said, should be on the company's outlook for its cutting-edge A.I. models, orbital data centers, its satellite internet service Starlink, and Starship, its largest-ever rocket that completed a largely successful test flight last month. With investments in rockets, satellite internet and A.I. infrastructure, SpaceX has a "moat" that leaves it "uniquely positioned to achieve these big-picture goals," Mr. Golding said. On Tuesday, SpaceX showed it had made progress in some of its businesses. Starlink increased subscribers to 12 million, up from 6 million in the same period last year. Its revenue rose 66 percent to $4.3 billion. On the investor call, Mr. Musk predicted that Starlink would "deliver the majority of the world's internet" in "less than 10 years." Gwynne Shotwell, SpaceX's president and chief operating officer, said she expected Starlink's business with companies and governments to grow substantially, adding, "It really feels like we're just getting started all over again." Revenue from space launches grew nearly 29 percent to $962 million, though losses in that business widened to $542 million. The payoff from SpaceX's A.I. spending is less certain. The company faces stiff competition for its A.I. products, such as its Grok chatbot. In June, it announced a $60 billion deal to buy Cursor, a start-up that develops A.I. tools for writing computer code, as rivals like Anthropic have already pressed ahead with such products. That transaction is expected to close in the current quarter. More recently, SpaceX has developed a business renting out A.I. computing power from data centers it built for its own A.I. efforts. The company has signed deals to lease excess computing capacity to Google, Anthropic and others. Mr. Golding said he expected those deals, which could total in the tens of billions of dollars over the next three years, to be reflected in future earnings. Anthropic, which is paying SpaceX $1.25 billion a month until May 2029 for computing power, started using SpaceX's data centers in May for a reduced fee. Google's deal begins in October. Mr. Musk marveled in the investor call at the rapid rate of A.I. development. He called the engineering problems of land-based data centers "trivial" when compared to the issues faced by his workers building rockets. "By the end of next year, it's not clear to me that there's anything digital that A.I. won't be able to do based on the current rate of improvement," he said.

SpaceX's first earnings: an AI company with a rocket attached

SpaceX reported its first earnings as a public company, and the headline was not about rockets. It made more revenue selling AI compute and satellite internet than from space itself, revenue nearly doubled to $7.8bn, and the stock still fell as much as 11%. SpaceX has reported its first earnings as a public company, and the biggest number was not the one about rockets. The company that launches most of the world's payloads made more money selling AI compute and satellite internet than it did from space. Revenue nearly doubled to $7.8bn. The stock still fell. For a firm named after space travel, that is a striking reordering. SpaceX's AI division brought in $2.6bn in the quarter, up 247% on the year. Its space business made $962m. The Verge put the shift plainly: SpaceX "made more revenue as an AI company than a space company." The rocket company that became a neocloud The AI money came almost entirely from a business SpaceX barely had a year ago: renting out GPUs. It signed deals to sell compute to Anthropic in May and Google in June, and told investors those contracts drove the growth. One buyer, named in the filing only as "Customer B", accounted for 19.5% of all SpaceX revenue, a figure that points to Anthropic. The reframing is more than cosmetic. SpaceX said in its record June IPO documents that most of its value would come from AI, not rockets. Its accounts now read, as Engadget put it, like "the financials of an AI company in 2026": fast growth bought with enormous spending. The AI unit still lost $1.26bn. Starlink is still the only part that makes money Beneath the AI story sits the business that actually pays. Starlink revenue rose 66% to $4.3bn, and its subscriber base doubled to 12 million, GeekWire reported. It was SpaceX's only profitable segment, with $1.7bn in operating income. We have written before that Starlink is the cash machine funding everything else. Elon Musk told analysts people were "really underestimating Starlink", and predicted it could deliver "a majority of the world's internet" within ten years. President Gwynne Shotwell said SpaceX would soon take on "the big three" US mobile carriers, a market she valued at $600bn. Rival satellite networks, for now, remain far behind. Why the stock fell anyway None of it soothed investors. Capital spending jumped more than sixfold to $18.4bn, most of it on AI, and well above what Wall Street expected. CNBC reported the figure "unnerved" the market, even as executives promised each AI investment pays for itself within a year. Shares fell as much as 11%. The reaction fits the season. Investors have punished heavy AI spenders all quarter. SpaceX now trades below its $135 IPO price and near half its June peak, the BBC noted. A separate squeeze lands on Thursday, when a lockup expires and about $101bn of insider stock can be sold, Bloomberg reported. Roughly 35% of the tradable float is already sold short. Musk one-upped his own executives The call followed a familiar pattern: Musk made vast claims, and his executives walked them back. TechCrunch counted several. When the CFO carefully framed a $100bn revenue run-rate target for December, Musk cut in: it "is not a question mark. That's what we would achieve if we basically did nothing." He compared SpaceX's edge in data centres to "the New York Yankees going in and playing a Little League team", and called building them "a trivial problem" next to reusable rockets. Then he described building factories on the Moon staffed by robots, which Fortune reported he admitted "sounds totally nuts". The number that matters For all the theatre, one figure will decide whether the strategy works: the gap between revenue and spending. Musk said SpaceX's internal target for $1trn in annual revenue had moved up a year, to 2030, with a "non-zero chance" of 2029. Reaching it means growing roughly tenfold in four years, from a company still losing money. The next test is nearer. SpaceX aims to catch a returning Starship with its launch tower this month, a genuine engineering milestone. But the market has already priced the company as an AI-infrastructure business with a rocket company attached. Its first results did nothing to change that read. They only sharpened it, days before the lockup lifts.

SpaceX Stock Drops After First Earnings Call as Musk Fails to Woo Investors With AI Goals

Elon Musk's SpaceX spent an eye-watering $18.4 billion in its first quarter as a publicly traded company and warned investors to expect similarly high spending in the next two financial quarters, sending the stock price down more than 8% in late trading on Tuesday evening. A whopping $15.8 billion of that spending was to power its artificial intelligence efforts, a division that ended the quarter with a $1.3 billion net operating loss. The figure comes from the company's first earnings report since the record-setting initial public offering hit the market in mid-June. Although the IPO was surely an amazing day for Musk, who briefly became the world's first trillionaire, things have not been all peachy since then, with the stock price currently well below its IPO price. As of last week, the company's stock was so far down from its IPO highs that the value it shed was roughly equal to Musk's other company, Tesla's, market capitalization. Tuesday's stock sales are unlikely to help that scenario, and neither is the fact that the company's first lockup period ends on Thursday, meaning some company insiders will be able to sell more than $100 billion worth of stock for the first time since SpaceX went public. To ease some of those worries, Musk promised dramatic AI advancements. "Our rate of growth certainly is faster than anyone else, and our efficiency of compute deployment I think is also the highest," Musk claimed. "So we expect to end this year with over two gigawatts of compute, and probably our cumulative compute online by the end of next year will be several times higher." Those compute plans are ambitious, but Musk struck a defiant tone against any doubters in the earnings call on Tuesday. "The terrestrial data centers are a trivial problem compared to making gigantic reusable rockets which are launched frequently," Musk said. Musk said SpaceX's data centers will be exclusively built on Nvidia chips. The two companies are also partnering to build Starmind AI satellites, a part of SpaceX's even more ambitious plan to put a giant colony of up to a million AI data centers in Earth's orbit. Some experts are hesitant that Musk and his company will be able to pull off the space-based data center colony plan, while many have also raised concerns about the environmental, economic, and social impact of such a huge launch program if it does pan out as promised. On the call, Musk said that SpaceX would begin launching the Starmind AI satellites in 2027. The company will also be unveiling Grok 5 before the end of the year, which Musk said would be trained on "all the data that SpaceX has ever produced," making the chatbot "by far the best engineer." Musk has previously claimed the yet-to-be-unveiled LLM will be AGI-level, aka a contested hypothetical AI that would theoretically equal or beat all human capabilities. "We expect the cadence of AI development to improve dramatically," Musk said. "I think, by the end of next year, it's not clear to me that there's anything digital at least that AI won't be able to do based on the current rate of improvement." All of this comes with a huge, obvious caveat: Musk has long had a penchant for overpromising. His hefty promises extended beyond the AI sphere on Tuesday as well, with the CEO claiming that the company's space business would be launching a rocket a day by next year and that there will be robots working in manufacturing operations on the literal Moon. "I know this sounds totally nuts, but you can probably scale to a thousand times the economy of Earth in terms of intelligence launched to space, but probably maybe even a million times," Musk claimed. "We're going to build the factories on the Moon; the robots will be helpful with that.

Breakingviews - SpaceX preps to separate financial booster rocket

NEW YORK, August 4 (Reuters Breakingviews) - SpaceX (SPCX.O), opens new tab can catch a falling rocket. Its tumbling stock price is another matter. After a meteoric IPO pop, the $1.7 trillion satellites-to-chatbots concern has seen its shares tumble 16% below the $150 their initial opening price. Its first-ever earnings report as a public company, unveiled on Tuesday, offers strong topline growth. Yet that rise is powered by the booster rocket of big, one-off deals. The hand-off to more sustainable propulsion awaits. The company's artificial intelligence division, xAI, drives most of the hype. SpaceX has said that enterprise applications and other AI services account for 90% of its addressable markets. It spent nearly $16 billion on capital expenditures to develop its colossal server racks, even as the unit recorded an ⁠operating loss of $1.3 billion. Impressively, xAI more than tripled revenue year-over-year to $2.6 billion. Yet a future of serving up technically inferior Grok models or renting out spare computing power amid a perhaps-temporary shortage seems questionable. Major deals to provide server grunt to Anthropic and Alphabet (GOOGL.O), opens new tab are a huge fillip. They may not be repeatable. SpaceX's satellite broadband division, Starlink, should be more durable. Revenue grew 66% to $4.3 billion and operating profit hit $1.7 billion. Long-term growth is more uncertain, given that earthbound connections will probably remain faster, cheaper, and easily available for most of the world's population. SpaceX's rocket business, then, is the company's true core. Second-quarter operating loss of $542 million is somewhat misleading: its relatively cheap orbital launches make Starlink possible. The division carried 80% of all mass humans put into space in ⁠the quarter, SpaceX reckons. Analysts at MoffettNathanson estimate the company charges itself $15 million per trip, compared to $70 million for outside customers. If Starlink paid market rates, the rocket division would have made $12.6 billion of revenue last year, rather than $4.1 billion. Getting the ever-delayed, gigantic Starship rocket operational would help lower costs and improve margins. Get cheap enough, and truly off-the-wall science projects, like low-gravity semiconductor, opens new tab or drug manufacturing, opens new tab, might even become conceivable. ⁠SpaceX needs such diversification: 82% of its cargo came from Starlink this quarter. Of course, corporate and geopolitical rivals will not want one company - especially one controlled by the opinionated Musk - to dominate space. If the orbital economy takes off, they may try to loosen his grip. ⁠And all of this remains conditional on solving incredibly difficult engineering problems. At least SpaceX's narrowing overall operating loss makes the spending required to hit its wildly ambitious goals seem ever-so-slightly more plausible. It still has light-years to go. Follow Robert Cyran on Bluesky, opens new tab. CONTEXT ⁠NEWS SpaceX said on August 4 that it generated $7.8 billion in revenue in the second quarter, compared to $4.1 billion for the same period a year prior. Revenue in its connectivity division, which houses satellite broadband business Starlink, grew 66% to $4.3 billion, while the AI unit's top line more than tripled to $2.6 billion. Editing by Jonathan Guilford; Production by Pranav Kiran * Suggested Topics: * Breakingviews * BRVF Breakingviews Reuters Breakingviews is the world's leading source of agenda-setting financial insight. As the Reuters brand for financial commentary, we dissect the big business and economic stories as they break around the world every day. A global team of about 30 correspondents in New York, London, Hong Kong and other major cities provides expert analysis in real time. Sign up for a free trial of our full service at https://www.breakingviews.com/trial and follow us on X @Breakingviews and at www.breakingviews.com. All opinions expressed are those of the authors. Robert Cyran Thomson Reuters Robert Cyran, U.S. tech columnist, joined Breakingviews in London in 2003 and moved four years later to New York, where he continues to cover global technology, pharmaceuticals and special situations. Robert began his career at Forbes magazine, where he assisted in the startup of the international version of the magazine. Before working at Breakingviews he worked as a market researcher and reporter covering the pharmaceutical industry. Robert has a Masters degree in economics from Birmingham University and an undergraduate degree from George Washington University.

SpaceX's AI spending unnerves Wall Street despite promises of quick payoff

Capital expenditures jumped more than sixfold from a year eariler. After SpaceX spent way more on its AI buildout than analysts expected, executives tried to convince investors on Tuesday that it's all worthwhile, claiming that the company is making its money back within a year. The message didn't resonate, as SpaceX shares sank following the company's first earnings report since its IPO in June. While revenue in the second quarter sailed past estimates, jumping 92% from a year prior, capital expenditures soared over sixfold to $18.4 billion, more than double total sales for the quarter. Well over 80% of SpaceX's capex went towards artificial intelligence, where the company is way behind OpenAI, Anthropic and Google when it comes to models and services, and where it's now trying to compete against cloud giants Microsoft, Amazon and Google by selling compute capacity. The capex figure exceeded the $13.22 billion average analyst analyst estimate, according to FactSet. The stock's 7.5% after-hours dropped mostly wiped out its gains from earlier in the day and left the shares more than 20% below the first trade on June 12. Bret Johnsen, SpaceX's CFO, suggested on the earnings call that investors should start thinking differently about capex because of how quickly it's converting into revenue. "We have been very efficient, to date and I think we'll continue to be," Johnsen said. "On the AI compute side, we're able to deploy capital in such a way that we're getting less than a one-year payback." Days before its record IPO, SpaceX inked a deal with Google that will bring in up to $920 million a month by providing AI compute capacity to the search giant. Prior to that, Anthropic announced a deal that would involve paying up to $1.25 billion a month for three years for compute capacity at SpaceX's Colossus data center in Memphis, Tennessee. And SpaceX has a separate agreement to provide computing power to Reflection AI for up to $150 million a month. Johnsen said that in the first few weeks of the current quarter, SpaceX contracted $6.7 billion of cloud services revenue "over a six-month period that begins ramping starting in October." Add it up, and the company is on pace to reach $100 billion in annualized recurring revenue by the end of the year, Johnsen said, noting that his numbers assume closure of the $60 billion Cursor acquisition. In 2025, SpaceX's total revenue came in at below $19 billion. SpaceX CEO Elon Musk said investors can take the 2026 target to the bank. "To be clear, the $100 billion ARR in December is not a question mark," Musk said. "That's what we would achieve if we basically did nothing." SpaceX addressed Wall Street for the first time during a period of heightened scrutiny surrounding AI spending as tech outlays reach into the stratosphere. Alphabet and Amazon could each spend over $200 billion this year, with Microsoft and Meta not too far behind. Companies are watching their cash piles dwindle, betting that all these upfront investments on data centers and costly AI systems from the likes of Nvidia will be profitable in the long run. The particular challenge for SpaceX, which entered the AI market in February through its merger with Musk's xAI, is that reselling AI capacity for short-term revenue is a strategy that's detached from the company's broader ambitions. The company said in its IPO prospectus that its "dual monetization strategy provides multiple pathways to generate returns on invested capital." Musk wants to be an AI pioneer through some combination of his company's Grok model and eventually by building data centers in space. The deals with Anthropic, Google and Reflection indicate that SpaceXAI, as the AI business is now known, built way more capacity at its mammoth data centers in Memphis than it's able to put to use. Musk said on the call that the company has a "series of projects" that cumulatively come to 20 gigawatts of capacity, including power and cooling, by the end of next year. "Some of them won't pan out exactly on time, but I would expect that we'd still probably have, at the power plant level, something close to 15GW," Musk said. There are also potential legal headwinds. SpaceXAI has been sued for using natural gas-burning turbines to power its facilities in Memphis without first installing pollution controls and obtaining federal permits. In its quarterly filing, SpaceX said it's recorded an accrual of $354 million for "litigation losses that are probable." To this point, SpaceX's AI business has been bleeding cash. In the second quarter, the unit generated $2.56 billion in revenue and had a $1.26 billion operating loss. That followed a $2.47 billion loss in the first quarter on $818 million in revenue. The company is trying to change the narrative with the new cloud agreements that Johnsen said helped deliver "significant margin expansion" in the quarter. Choose CNBC as your preferred source on Google and never miss a moment from the most trusted name in business news.

SpaceX tops revenue expectations in first earnings report after IPO

Why it matters: SpaceX has been under the microscope -- with shares falling below their IPO price of $135 -- as investors look for Elon Musk to deliver AI advancements. Driving the news: SpaceX's revenue soared 92%, to $7.81 billion, in the period ended June 30, compared with a year earlier, topping S&P Visible Alpha expectations of $6.9 billion. That included: * $4.29 billion in its connectivity division, which includes the Starlink satellite internet service, up 66% from a year earlier. * $2.56 billion in AI revenue, which includes xAI and Grok subscriptions, up 247%. * $962 million in space revenue, up 29%. Zoom in: SpaceX shares had been suffering in recent weeks amid concerns about an AI bubble. They remain below June's IPO and far below Wall Street's consensus target price of $293, according to S&P Visible Alpha. * "The weakness has been partially driven by concerns about overgrowth around AI and data centers," according to Melissa Otto, head of Visible Alpha Research. "There is increasing concern in the market that AI infrastructure investments will not be able to generate a return in line with the level of cash needed." What to watch: How quickly SpaceX burns through its $100 billion stockpile of cash and marketable securities, plus how quickly it can fulfill its $47.5 billion order backlog. * The company's net loss fell from $1 billion a year ago to $541 million in the period ended June 30. * The company is projecting a 99% decline in the cost to orbit as it invests heavily in its Starship rocket program. * "This financial strength gives us substantial capacity to invest in Starship, Starlink Broadband and Mobile satellites, and our AI platform, while maintaining a disciplined long-term capital allocation framework," SpaceX chief financial officer Bret Johnson said in a statement. What's next: On the earnings call, Musk said that SpaceX would build out its data centers exclusively with Nvidia chips: "We've decided to build exclusively on Nvidia because we think the Vera Rubin is the best architecture. We think it's the best AI computer and we greatly value our close cooperation."

SpaceX quarterly revenue surges in debut results on strong growth in its Starlink business

Aug 4 (Reuters) - SpaceX (SPCX.O), opens new tab reported on Tuesday a 92% rise in revenue for the April-June quarter, in its first earnings since going public, buoyed by strong growth in its Starlink satellite-internet and AI businesses. It reported revenue of $7.8 billion, compared with $4.1 billion a year earlier. Second-quarter revenue beat expectations of $6.93 billion, according to LSEG data. The company posted a net loss of $541 million attributable to shareholders for the three months ended June 30. The company said it invested $18.37 billion in AI infrastructure, Starship and Starlink expansion. The company's stock has declined 8% since its record-breaking initial public offering in June that valued the company at about $1.75 trillion. The stock could face additional pressure from the expiry of SpaceX's post-IPO lock-up period starting on Thursday, which may unleash a wave of insider and early-investor shares on the market. Starlink and SpaceX's broader connectivity operations remain the company's primary financial engine, underpinning CEO Elon Musk's push to build an AI-first business ⁠that extends beyond renting compute capacity to developing frontier models, consumer and enterprise software, and, eventually, data centers in space. The company's satellite-internet unit has continued to expand its global subscriber base, aided by launches of additional satellites and a growing range of consumer, enterprise, aviation, maritime and government services. But that expansion has come with tradeoffs: average revenue per user (ARPU) has dropped as SpaceX has entered more international markets and rolled out lower-priced plans. Investors are watching whether SpaceX can maintain growth while improving the economics of its network, particularly as it spends heavily to expand coverage, increase capacity and develop direct-to-device mobile services. SpaceX's AI business, which includes xAI, Grok, and social-media platform X, and a rapidly expanding data center operation, has been its biggest area of investment. The business is generating revenue from compute contracts with Anthropic, Alphabet's Google and Reflection AI, though a portion of its recurring revenue has yet ⁠to be recognized. Operating losses at the AI business have mounted, and SpaceX has cautioned that the AI unit will require sustained investment before it can generate profits consistently. Starship, SpaceX's next-generation reusable rocket system, is yet to enter commercial service but is expected to enable deployment of higher-bandwidth Starlink satellites and orbital AI-computing infrastructure. The company's ability to turn Starship into a reliably reusable vehicle is central to its longer-term strategy. Investors have closely watched for updates on testing progress, launch cadence, reusability ⁠milestones and the vehicle's satellite-deployment capabilities. Separately, SpaceX said that it had partnered with Nvidia (NVDA.O), opens new tab to use its chips in the Starmind AI1 orbital compute satellites. The space segment, which includes commercial launches, government missions and development of Starship remains a significant source of costs and uncertainty. While launch activity for Falcon -- SpaceX's partially reusable workhorse rocket -- has ⁠remained robust, revenue can vary with the mix of internal Starlink deployments, commercial customer missions and government contracts. In recent years, SpaceX has increasingly prioritized launches for its own satellite network over third-party payloads, while continuing to absorb significant costs tied to Starship's development. Investors will also be keen to hear Musk's ⁠comments on a potential merger between SpaceX and Tesla (TSLA.O), opens new tab after a Wall Street Journal report last week that executives at his electric-vehicle company had been told to prepare for a separation of its China business ahead of a potential deal. Musk dismissed the report as "fake news," but he had previously declined to rule out the possibility, citing growing overlap between the companies. Reporting by Akash Sriram in Bengaluru; Editing by Sriraj Kalluvila Our Standards: The Thomson Reuters Trust Principles., opens new tab * Suggested Topics: * Artificial Intelligence * ADAS, AV & Safety * Software-Defined Vehicle * Sustainable & EV Supply Chain

SpaceX races toward Musk's $1 trillion dream -- just as insiders can start selling | Fortune

SpaceX reported a smaller loss than Wall Street expected along with a surge in revenue in its first quarterly report as a public company as it sharply boosted spending, particularly on artificial intelligence. The company run by Elon Musk posted a loss of $541 million, or 9 cents per share, in the three months through June, less than half what financial analysts had forecast. Revenue jumped to $7.8 billion, up more than 90% from the year-earlier period. A standout in the quarter was the company's big cash source, its "connectivity" business, with revenue jumping 66% from a year earlier as the number of subscribers to its Starlink satellite communications service doubled to 12 million. "It's not out of the question that at some point, Starlink will deliver a majority of the world's internet," Musk said in call with analysts. SpaceX stock rose 9% in regular trading Tuesday, but gave most of the gain back after hours. The rocket, satellite and AI company's stock has fallen by roughly half since peaking in June shortly after an initial public offering that briefly made Musk the world's first trillionaire. Investors are worried Musk has oversold them on the company's future prospects for space travel and its AI chatbot Grok. They're also bracing for volatile trading as some company insiders get the opportunity to sell shares after the expiration of what's known as a lockup provision later in the week. Another area of concern is SpaceX spending on infrastructure and R&D, which jumped to $18 billion from less than $3 billion a year ago. The company's chief financial officer, Bret Johnsen, said to expect similar capital expenditures for the next two quarters. Musk defended the outlays, a concern also weighing on many other technology companies spending heavily on AI, saying the resulting supercharged growth meant the company would reach a trillion dollars in revenue a year faster now, 2030 rather than 2031. Shares jumped 19% on their first day of trading in June, making Musk the first-ever trillionaire. The subsequent drop, as well as a decline in the shares of Musk's electric vehicle company Tesla, have knocked his wealth down to $783 billion, according to Forbes. Musk was asked several times about the prospects for the gigantic Starship rocket that is key to SpaceX realizing his ambitions. Starship successfully deployed satellites in space during a test late last month. Musk said he expected SpaceX will attempt to test the reusability of Starship at the end of the month when it will attempt to grab the spacecraft and its booster with mechanical arms upon their return to their base. NASA hopes to use Starship to put astronauts on the moon again in the near future. "We want to put boots on the ground -- boots on the moon -- in 2028," said SpaceX President Gwynne Shotwell. SpaceX shares could see continued volatility. Some insiders have been barred from selling in the public offering but that prohibition begins to ease on Thursday when more than 900 million shares are released for trading, more than doubling the amount currently available. The lockup release is the first of several tranches of stock that will be freed to trade over the next several months. The company also runs the social media platform X, formerly Twitter.

Why SpaceX stock is falling despite strong revenue growth

Mary Cunningham is a reporter for CBS MoneyWatch. She previously worked at "60 Minutes," CBSNews.com and CBS News 24/7 as part of the CBS News Associate Program. Shares of SpaceX tumbled on Wednesday despite reporting strong revenue growth in its first public quarterly earnings report, as investors questioned the rocket maker's accelerating investment in artificial intelligence. SpaceX shares tumbled $10.06, or 8%, to $115.27 in early afternoon trading on Wednesday. Investors are worried that the company's massive investments in artificial intelligence won't be enough to justify SpaceX's $1.5 trillion valuation. SpaceX's earnings report on Tuesday disclosed $15.8 billion in AI-related capital expenditures during the second quarter, more than double the amount it spent in the first quarter. "The entire market is beginning to suspect that the extraordinary spend on AI might not work out for every firm," David Trainer, CEO of New Constructs, an investment research firm, told CBS News in an email. "They cannot all be winners, yet they are all spending as if they will be." Investors looked past the company's strong quarterly report to instead focus on whether SpaceX can deliver on its ambitious agenda, which includes sending data centers into space. "Elon Musk has a history of overpromising, so investors took some of the optimistic forecasts with a grain of salt," Jay Ritter, an IPO expert and professor at the University of Florida's Warrington College of Business, told CBS News in an email. AI-related investments accounted for 86% of the company's overall CapEx spending from April to June, totaling $18.4 billion. "We're building AI compute capacity at scale faster than anyone else, we believe, and we're significantly improving our AI models, most notably with the release of Grok 4.5 last month," Musk said on Wednesday's earnings call. The company's second-quarter revenue of $7.8 billion exceeded analysts' forecasts, while it narrowed its loss to $541 million from $1 billion a year earlier. "The good news is that revenue and earnings for the quarter were above expectations, and that the company was optimistic about its ability to launch orbital data centers as early as next year," Ritter said. "But the bad news is that the company is spending lots of cash on Earth-based data centers, a business that has a lot of competition." The company's biggest source of revenue is its satellite division, home to Starlink. However, its AI segment has the potential to drive SpaceX's valuation in the future, Nicolas Owens, an equity analyst at Morningstar who covers SpaceX, said in a Wednesday analysis. Despite the stock's decline, Morningstar still views SpaceX shares as overvalued, he noted. SpaceX stock could face further downward pressure on Thursday when up to 911.5 million shares become eligible for sale as a lockup period expires, potentially flooding the market with new shares. Short sellers, who have been betting against SpaceX, could also ramp up their bets that the stock could fall, adding to its volatility. "The lockup expiration does not mean every insider or early investor will sell, but it does increase the potential supply of shares coming to market, which can create near-term pressure on the stock," Paul Karger, co-founder and managing partner at private investment firm TwinFocus, said in an email.

SpaceX posts smaller loss despite scrutiny over rocket and AI spending

The rocket and satellite company beat Wall Street's loss forecasts in its first quarterly report as a public company, even as investors question its heavy AI spending and whether Elon Musk has oversold its prospects. SpaceX has reported a smaller loss than Wall Street expected alongside a surge in revenue in its first quarterly results as a public company. The rocket, satellite and AI firm sharply increased spending in the quarter, particularly on artificial intelligence. The company run by Elon Musk posted a loss of $541 million (€469mn) or 9 cents a share in the three months to the end of June. That was less than half what analysts had forecast. Revenue jumped to $7.8 billion (€6.8bn) up more than 90% from the year-earlier period. The standout performer was SpaceX's biggest cash generator, its "connectivity" business. Revenue there rose 66% year-on-year as subscribers to its Starlink satellite internet service doubled to 12 million. "It's not out of the question that at some point, Starlink will deliver a majority of the world's internet," Musk told analysts on a call. Stock swings on IPO worries SpaceX shares rose 9% in regular trading on Tuesday but gave back most of that gain after hours. The stock has fallen by roughly half since peaking in June, shortly after an initial public offering that briefly made Musk the world's first trillionaire. Investors are concerned Musk may have oversold the company's prospects in space travel and its Grok AI chatbot. Markets are also braced for volatile trading later in the week, when a lockup provision preventing some company insiders from selling shares begins to expire. Shares jumped 19% on their first day of trading in June. The subsequent slide, combined with a drop in shares of Musk's electric carmaker Tesla, has pulled his fortune down to $783 billion (€679 billion), according to Forbes. AI spending under scrutiny SpaceX's spending on infrastructure and research and development jumped to $18 billion (€15.6bn), from less than $3 billion (€2.6bn) a year earlier. Chief financial officer Bret Johnsen said investors should expect similarly high capital expenditure over the next two quarters. Musk defended the spending, an issue also facing other technology companies pouring money into AI. He said the growth it was fuelling meant SpaceX would reach $1 trillion (€870bn) in annual revenue a year earlier than planned, in 2030 rather than 2031. Starship tests loom Musk faced repeated questions about Starship, the giant rocket central to his long-term ambitions for the company. It successfully deployed satellites during a test late last month. He said SpaceX plans to test Starship's reusability at the end of the month, attempting to catch the spacecraft and its booster with mechanical arms on their return to base. NASA hopes to use Starship to return astronauts to the Moon. "We want to put boots on the ground -- boots on the Moon -- in 2028," SpaceX President Gwynne Shotwell said. More than 900 million shares are due to be released for trading on Thursday, more than doubling the amount currently available, as the first of several lockup tranches expires over the coming months. SpaceX also owns the social media platform X, formerly Twitter.

SpaceX hit by surging AI costs as insiders prepare to sell their shares

Elon Musk, founder of Space Exploration Technologies Corp. (SpaceX), on screen during the company's initial public offering at the Nasdaq MarketSite in New York in June. Adam Gray / Bloomberg via Getty Images file For a rocket company, SpaceX is spending a lot of money to build out its AI capacities. Too much, according to investors. The company reported revenues and earnings in its first-ever quarterly update as a public company that the surpassed analysts' expectations. Most of its revenues came from its Starlink satellite offering. But investor focus turned to capital expenditures related to its xAI unit, which runs the Grok AI service. Those hit $15.8 billion, higher than expectations of $13.09 billion, according to Bloomberg News data. The spending also comprised most of SpaceX's overall $18.4 billion quarterly spending on cap-ex. The report caused SpaceX shares to reverse a healthy run-up during regular trading hours Tuesday. The stock fell some 5% in trading after the closing bell, after having surged 9% earlier. SpaceX immediately became a multi-trillion-dollar company after a record-setting IPO on June 12 -- but nearly just as quickly, it erased $1 trillion in value as the stock plunged amid anticipation of insider stock sales and broader jitters about the pace of AI spending. Still, the company continues to enjoy a market valuation of more than $1 trillion, making it one of the most valuable companies in the world. The stock got an additional boost Tuesday after announcing a new deal with Nvidia that will see it provide SpaceX with additional computing power. Investor speculation has grown that SpaceX may attempt to merge with its sister company, Tesla. This would give Elon Musk even more control over his multi-faceted technology empire than he already exerts.

SpaceX revenue jumps 92% in first earnings report

San Francisco (United States) (AFP) - SpaceX's revenue jumped 92 percent in the second quarter, beating analyst expectations by around $1 billion in its first earnings report since going public in June, the company announced Tuesday. AI computing deals and Starlink satellite growth fueled the results, the company said in a statement. But it also continued to spend heavily, with capital expenditures exceeding $18 billion in the three months ending in June. More than 86 percent of that spending went to its artificial intelligence division. Starlink's satellite connectivity service grew to 12 million subscribers, doubling from a year earlier. The company reduced its net loss to $541 million. During a call with analysts Tuesday afternoon, CEO Elon Musk and COO Gwynne Shotwell both sought to reassure investors that SpaceX is successfully evolving from being primarily a rocket company into a conglomerate with AI at its core. SpaceX shares dropped more than 7 percent during after-hours trading. Investors remain skeptical even with SpaceX beating expectations, Emarketer Senior Analyst Gadjo Sevilla told AFP. "I don't think people want to hear promises about the next five years or a mission to Mars," Sevilla said. "Everyone knows that will take time. They want to see how the value can be turned around as quickly as possible."

SpaceX's first results as public company spook investors

Elon Musk's space and AI group posted stronger than expected revenue, but a huge capex bill sent shares lower. SpaceX has posted its first earnings report since going public in June, beating Wall Street's revenue expectations but rattling investors with the scale of its spending on AI infrastructure. Revenue for the second quarter came in at $7.8bn, up 92pc year-on-year and comfortably ahead of the $6.8bn consensus according to Bloomberg. The company also narrowed its net loss to $541m, down from $4.3bn in the first quarter. Despite the progress, shares fell as much as 8pc in after-hours trading once the scale of its AI investment became clear. Capital expenditure jumped to $18.4bn for the quarter, according to Reuters, of which roughly $15.8bn went on AI infrastructure alone, well above the $13.2bn analysts had predicted. Chief financial officer Bret Johnsen told investors on the earnings call that the group's AI compute investments were delivering a payback period of less than a year, and that capital spending would likely hold at similar levels for several more quarters. Elon Musk used the call to defend the group's ambitions, telling analysts that SpaceX's internal target of $1trn in annual revenue had moved forward a year, from 2031 to 2030, with a "non-zero chance" of arriving in 2029, according to Bloomberg. The reaction extends a rocky run for the stock since its record-breaking debut in June, when SpaceX raised $75bn at $135 a share and briefly commanded a market value above $1.7trn. Shares have since fallen well below the IPO price, with the stock shedding more than $1trn in value from its June peak. Investor nerves are likely to remain on edge as a 'lockup period' expires on Thursday, freeing hundreds of millions of insider shares for sale, a moment that will be closely watched for further downward pressure on the stock. Don't miss out on the knowledge you need to succeed. Sign up for the Daily Brief, Silicon Republic's digest of need-to-know sci-tech news.

SpaceX's first results put Musk's AI spending under Wall Street microscope

August 3 (Reuters) - SpaceX's (SPCX.O), opens new tab first earnings report since its record-breaking IPO will provide an early gauge of whether Starlink's profits can sustain the company's rapidly growing spending on AI and space ventures. Due after the market closes on Tuesday, the results will give SpaceX's limited pool of public investors their first chance to judge whether the financial case behind the company's lofty valuation supports CEO Elon Musk's vision of a powerhouse spanning AI, space and telecommunications. Musk has pitched AI as SpaceX's future growth engine, with ambitions extending beyond renting compute capacity to other companies to developing frontier models, consumer and enterprise software, and, eventually, data centers in space. But until its AI business and Starship launch operations can stand on their own, Musk plans to use Starlink's profits to bankroll both ventures, a strategy critics argue is unsustainable. "Starlink is executing beautifully, but it cannot single-handedly fund a $30 billion annualized AI capex program," said Will Rhind, founder and CEO of GraniteShares, an asset manager that offers ETFs tied to SpaceX stock performance. Analysts expect the AI business to nearly triple to $2.33 billion in the April-June quarter, up sharply ⁠from 12.5% growth in the prior quarter, according to LSEG-compiled data. Starlink growth is also expected to accelerate to 52.6% from 31.6%, driven mainly by expansion into more countries. SpaceX's AI expansion consumed $7.72 billion in the January-March quarter, accounting for about three-quarters of the company's total capital spending. Analysts expect SpaceX to report capital expenses of nearly $14.05 billion in the April-June quarter. Capital spending in the AI segment is expected to surge more than six times to $10.2 billion from the same period last year, according to Visible Alpha data. SpaceX shares have pulled back sharply since the company's $86 billion IPO in June, as investors questioned whether its lofty valuation of 77 times expected revenue can be justified. The stock could face additional pressure from the expiry of SpaceX's post-IPO lock-up period starting August 6, which may unleash a wave of insider and early-investor shares on the market. Investors will also be keen to hear Musk's comments on a potential merger between SpaceX and Tesla (TSLA.O), opens new tab after a media report emerged last week that executives at his EV company had been told to prepare for a separation of its China business ahead of a potential deal. Musk dismissed the report as "fake news," but he had previously declined to dismiss the possibility, citing growing ⁠overlap between the companies. COMPUTE REVENUE IN FOCUS Analysts expect revenue from connectivity (Starlink) of $3.82 billion and operating profit of $1.42 billion in the second quarter ended June 30. In the first quarter, operating profit was $1.19 billion. At the end of March, Starlink had 10.3 million subscribers, roughly double the level a year earlier, though average revenue per user fell nearly 25%. SpaceX has signed AI compute agreements with customers including Anthropic, Alphabet's (GOOGL.O), opens new tab Google and Reflection AI, but that may not be enough. "The key question for investors is whether SpaceX can monetize its AI infrastructure through third-party compute fast enough to offset xAI's extraordinary capital intensity," said Michael Monaghan, portfolio manager of the Founders 100 ETF (FFF.Z), opens new tab, which ⁠holds SpaceX shares. MoffettNathanson analyst Julie Zhu expects SpaceX's AI business to generate positive core profit this year, helped by infrastructure agreements, although she said the gains would be tempered by the segment's significantly higher capital spending requirements. "This is not going to be a free cash flow story now, soon, or maybe even ever," said Bill Birmingham, managing director at REX Financial, which offers ETFs tied to SpaceX stock. For the whole company, analysts expect SpaceX to ⁠report second-quarter revenue of about $6.93 billion and loss before interest and taxes of $1.55 billion. STARSHIP REMAINS KEY Many investors still view Starship as SpaceX's most important asset and the key to Musk's long-term vision, underpinning plans to expand Starlink, land astronauts on the moon for NASA by 2028 and eventually deploy AI-processing satellites in orbit. Last month, Starship successfully deployed the first upgraded Starlink V3 satellites after its 13th test flight, ⁠but the Super Heavy booster fell short of a controlled splashdown. Analysts expect SpaceX's launch business to generate $871.4 million in second-quarter revenue, while posting an operating loss of $773 million. In the January-March quarter, operating loss surged ninefold from a year earlier, and revenue fell 28.4% to $619 million. "The progress on Starship is essential for demonstrating to investors that the company is on the desired trajectory," said Micah Walter-Range, a space industry specialist who helped develop the index tracked by the Procure Space ETF (UFO.O), opens new tab. Reporting by Akash Sriram in Bengaluru; Editing by Sayantani Ghosh and Anil D'Silva Our Standards: The Thomson Reuters Trust Principles., opens new tab * Suggested Topics: * Autos & Transportation * Capital Markets * ADAS, AV & Safety * Software-Defined Vehicle * Sustainable & EV Supply Chain Akash Sriram Thomson Reuters Akash reports on technology companies in the United States, electric vehicle companies, and the space industry. His reporting usually appears in the Autos & Transportation and Technology sections. He has a postgraduate degree in Conflict, Development, and Security from the University of Leeds. Akash's interests include music, football (soccer), and Formula 1.

Rockets, Starlink, AI: SpaceX faces its first Wall Street grilling

San Francisco (United States) (AFP) - Less than two months after a record-breaking IPO, SpaceX is set to publish its first quarterly results after markets close on Tuesday, as the share price of Elon Musk's rocket ship and AI company has lost around half its value since peaking in June. With a market valuation hovering around $1.5 trillion, the company must prove that it can, in the long run, turn its various promises -- dominating artificial intelligence, creating data centers in space, colonizing Mars -- into profits for investors. Failing to deliver on those promises would reach far beyond Wall Street; SpaceX was added to the Nasdaq 100 in July, which means it is now embedded in the retirement savings of millions of Americans. For now, no one is expecting profits from its current quarter, which ended in June. Analysts on average expect a loss of $1.9 billion on revenue of $6.8 billion in SpaceX's second quarter, but that loss is around a 50 percent improvement compared to the previous quarter. SpaceX could also break even by the end of September. That improvement is thanks, in particular, to the mega-contract signed with AI lab Anthropic, which since July has been paying $1.25 billion dollars a month to use SpaceX's Colossus data center near Memphis, Tennessee. Above all, Tuesday's results will show the extent of SpaceX's evolution from being primarily a rocket company to a conglomerate with AI at its core. Rocket launches, historically the core of SpaceX's business, now account for only a fifth of its revenue and lose money. Starlink, its satellite internet business, provides more than half of revenue and remains the only profitable segment. But the AI division -- which encompasses the social network X, the Grok conversational robot, and data center leasing -- is expected to become the group's leading source of revenue as early as the current quarter. Because in addition to Anthropic, Google is preparing this fall to pay SpaceX $920 million a month to use its computing power, and the startup Reflection AI has signed a similar deal. SpaceX thus rents out its machines to its own competitors as its AI model Grok struggles to gain commercial traction against OpenAI's ChatGPT and Anthropic's Claude. These contracts, however, can be terminated with just three months' notice. Google itself describes its deal as short-term "backup capacity." "AI is the growth story but rests on computer contracts that expire by end-2029," Phillip Securities, one of the few firms to recommend selling the stock, said in an analyst note. - Merger with Tesla? - Another closely watched issue: spending. For every dollar it takes in, SpaceX invests nearly two, both in its data centers and in Starship, its mega-rocket still in testing and on which a large part of the whole business depends. The group is expected to keep burning tens of billions of dollars in cash for at least three more years, according to observers. Uncertainty will also linger this week until a lockup period expires on Thursday, allowing a portion of SpaceX employees to sell their shares post-IPO. That could more than double the already limited number of shares in circulation, which currently sits at around 5 percent. "We believe the quarterly results should not matter," analysts at the firm Bernstein said in a note. Rather, it will be Musk's remarks that will move the stock, depending on what he says about capital expenditures, a potential $60 billion-dollar buyout of AI startup Cursor or even a rumored merger with his carmaker Tesla.

Elon Musk Projects $1T in SpaceX Revenue After Spending $16B on A.I. in 3 Months

Revenue nearly doubled and losses narrowed, but Wall Street punished SpaceX for pouring billions into xAI data centers and other capital-intensive bets. After its historic IPO in June, Elon Musk's SpaceX yesterday (Aug. 4) reported its first earnings as a public company. Revenue for the quarter ended June 30 came to $7.8 billion, up 92 percent year over year and ahead of estimates. Meanwhile, the net loss narrowed to $541 million from about $1 billion a year earlier, also better than expected. However, SpaceX shares fell about 8 percent in after-hours trading as investors worried about the company's heavy spending on A.I. infrastructure. Sign Up For Our Daily Newsletter Sign Up Thank you for signing up! By clicking submit, you agree to our <a href="http://observermedia.com/terms">terms of service</a> and acknowledge we may use your information to send you emails, product samples, and promotions on this website and other properties. You can opt out anytime. See all of our newsletters During the quarter, SpaceX spent $18.4 billion on capital expenditures (CapEx), exceeding Wall Street's expectations of roughly $13-14 billion. The majority of the spend -- $15.8 billion -- was tied to SpaceX's A.I. operations, largely through its xAI unit, as it built out data centers. Last year, SpaceX disclosed about $21 billion in CapEx, driven by A.I. investments. SpaceX has three main business segments: Space, Connectivity and A.I. * Space, which consists mainly of its launch business, generated $962 million in revenue during the April-June quarter. * Connectivity, its only profitable segment and home to Starlink, generated $4.29 billion in revenue, helped by subscriber growth to 12 million at quarter end. * A.I., which includes xAI compute, cloud services and related offerings, generated $2.56 billion in revenue. During the earnings call, CFO Bret Johnsen said the company was on track to reach a $100 billion annualized revenue run rate (ARR) by the end of 2026, citing strong early third-quarter results so far and the expected contribution from Cursor, the A.I. coding startup SpaceX agreed to acquire in June for $60 billion (the deal is expected to close in Q3 2026, pending approvals). Elon Musk added that "the $100 billion ARR in December is not a question mark. That's what we'd achieve if we basically did nothing." Some analysts warn that if spending remains at similar levels in Q3 and Q4, full-year CapEx could approach $65 billion. Musk also said on the call that people were "underestimating" Starlink. "It's not out of the question that at some point, Starlink will deliver a majority of the world's internet, at least in countries where we're allowed to operate," he said, suggesting that A.I., humanoid robotics and vehicle robotics will increase demand for bandwidth. He also shared internal projections that the company could reach $1 trillion in revenue by 2030. Before the earnings release, SpaceX shares were down nearly 30 percent from their June debut, underperforming the S&P 500, partly due to concerns about overexpansion in A.I. and data centers, and worries that A.I. infrastructure investments may not generate returns commensurate with the cash deployed. The company has also moved into hyperscaler-like territory, selling compute to third parties and operating large facilities such as the Colossus and Colossus 2 data centers. SpaceX has secured major contracts with Anthropic and Google: Anthropic agreed to pay $1.25 billion per month for compute capacity (announced in late May, with terms through 2029), and Google entered a $920 million-per-month commitment running from October 2026 through June 2029. SpaceX also has several wild-card initiatives in the pipeline, including Starmind, an A.I. satellite megaconstellation aimed at orbital compute, and Terafab, a chip manufacturing project in East Texas announced in March 2026.

SpaceX shares tumble 12%, fall below IPO price as AI spending concerns mount

SpaceX has demonstrated accelerated returns on its AI investments, though investors express concerns regarding future funding for data centers. Following its IPO, the company's stock saw a significant drop. Despite this, AI revenue surged over threefold, and new cloud agreements were announced. The capital invested in AI is still high, promising returns in under a year. SpaceX shares fell about 12% on Wednesday as concerns over heavy AI spending overshadowed the company's faster-than-expected returns from those investments in its first earnings call since going public, Reuters reported. The stock dropped to below $110 in early trading, well below its $135 IPO price less than two months after the company's blockbuster market debut. US MarketsPowered By As on 05 Aug 2026, 10:21 PM IST S&P 500 Top Gainers Charles River258.65(10.48%) Intl Flavors & Fragrances87.61(8.30%) Newmont104.78(7.21%) Wynn Resorts104.26(6.83%) Gainers" S&P 500 Top Losers Insulet133.42(-20.02%) DaVita186.99(-17.98%) CDW138.61(-9.99%) Match Group37.66(-8.68%) Losers" Investors questioned how long the profitable Starlink business could continue funding costly investments in data centres and Nvidia chips. "With capex expected to remain elevated and investor enthusiasm cooling, I believe the stock could remain under pressure ahead of the lock-up expiration," Carolane de Palmas, market analyst at brokerage ActivTrades, told Reuters. "That could translate into significant volatility as markets reassess SpaceX's valuation and cash-burn trajectory." SpaceX said its AI revenue more than tripled from a year earlier and announced several new cloud-computing agreements, even as quarterly AI-related capital expenditure rose to $15.8 billion. Chief Financial Officer Bret Johnsen said returns from those investments were improving rapidly, but indicated that AI spending would remain high. "The current economics have translated into a less than one-year payback on our new capital deployments for compute," Johnsen said. He added that SpaceX had signed $6.7 billion in additional cloud-computing contracts since the second quarter ended and remained on track to reach an annualised revenue run rate of $100 billion by year-end. That compares with traditional data-centre investments, which typically take several years to recoup their initial costs. "Elon has continued to surprise investors on what innovation and technology can do, but there has always been a mismatch in terms of the ⁠time frame of when that execution is going to occur," David Wagner, portfolio manager at Aptus Capital Advisors, said, referring to Musk's often-rosy outlook at his EV company Tesla that he has regularly missed. "I believe the numbers. I would say that yes, those numbers are aggressive, but ⁠it's not a fantasy. The pieces exist, they just require flawless execution." The post-earnings commentary marked a shift in the investment narrative around SpaceX. Before the results, investors largely saw Starlink's growing cash flow as the main source of funding for the company's AI ambitions. Management now says the AI infrastructure business is generating enough revenue to help finance its own expansion. To be sure, the company spent about $18.4 billion on capital expenditures during the quarter, roughly a fifth of the $85.7 billion it raised in its June IPO, and remained deeply free cash flow negative as it continued investing heavily in AI infrastructure. SpaceX's AI division brought in $2.6 billion in second-quarter revenue, more than three times its year-earlier figure, but remained unprofitable at the operating level. The company nevertheless plans to sustain its heavy spending. Johnsen expects capital expenditure in each of the next two quarters to stay broadly in line with the second quarter as SpaceX builds out AI computing infrastructure, increases Starship production and develops its next generation of Starlink satellites. "New compute capital monetises so quickly that it behaves more like cost of goods sold than capital expenditure," said Michael Monaghan, portfolio manager of the Founders 100 ETF, which owns SpaceX shares. SpaceX executives said demand for AI computing capacity continues to exceed supply and that the company expects to have more than two gigawatts of capacity by year-end. If demand remains strong enough to keep that infrastructure fully utilised, the AI business could increasingly finance its own expansion instead of depending on Starlink's cash flow.

SpaceX Is a 'Potential Generational Compounder,' Morgan Stanley Says as $101 Billion Unlock Fails to Trig

SpaceX (NASDAQ:SPCX) rose Thursday on the very day more than 900 million insider-held shares became eligible for sale, a tranche worth around $101 billion at midday prices. The supply-driven collapse some feared has not arrived, at least not yet. Morgan Stanley's Adam Jonas framed the lockup expiration as an entry point rather than a warning, calling SpaceX a "potential generational compounder that converts energy into a networked/swarming intelligence at scale." He carries an Overweight rating and a $300 mid-2027 target, implying the stock could nearly triple from current levels. Why Jonas Thinks SpaceX Can Nearly Triple Jonas argues SpaceX's launch, satellite-connectivity and AI assets give it "the pieces to build an industry-leading intelligence per watt, per dollar, per second." More than half of Jonas's $300 target is attributed to SpaceX's AI segment, with the remainder largely reflecting its launch and satellite-connectivity businesses. His bull case requires the company's enormous AI spending to translate into durable revenue and cash flow. Prediction-market traders remain skeptical that Musk's own AI models will finish the year with the best model. A Polymarket contract with more than $556,000 traded gives xAI roughly a 3% chance of having the best AI model at year-end, compared with 67% for Anthropic and 11% for OpenAI. That may make SpaceX's infrastructure role more important. As Benzinga reported Wednesday, veteran analyst Bob O'Donnell believes the company is increasingly operating like a "neocloud," leasing computing capacity to outside AI developers. SpaceX could therefore benefit from AI demand even if Grok does not win the model race. Renting out spare computing capacity could generate revenue from infrastructure that might otherwise sit underused, but it risks leaving SpaceX with the costs while customers retain the models and customer relationships. Morgan Stanley was one of the banks that helped take SpaceX public in June. The $101 Billion Unlock That Didn't Break the Stock Up to 911.5 million shares became eligible Thursday, more than doubling the tradable float. Eligibility does not mean insiders sold, and there is no evidence most did. Some of the pressure may have been priced in beforehand. The stock dropped 13.6% Wednesday, but on Thursday is up almost 3% at the time of writing. Thursday's trading offered little evidence of the immediate supply shock bears had feared, although insiders can now sell over time. Image: Shutterstock Market News and Data brought to you by Benzinga APIs To add Benzinga News as your preferred source on Google, click here.

SpaceX's AI splurge puts a damper on debut earnings after IPO

SpaceX stock fell Tuesday after the company disclosed higher-than-expected spending on its artificial intelligence business, dampening an inaugural quarterly report that broadly surpassed Wall Street forecasts. Shares of entrepreneur Elon Musk's rocket, satellite and AI conglomerate tumbled as much as 8.8% in U.S. post-market trading after it said capital spending jumped to about $18.4 billion in the second quarter. "We expect the cadence of AI development to improve dramatically," Musk told analysts on a conference call after the company reported results that beat forecasts for revenue, AI losses and Starlink subscriber growth.

SpaceX shares slump 12% as AI spending worries overshadow early returns

SpaceX has demonstrated accelerated returns on its AI investments, though investors express concerns regarding future funding for data centers. Following its IPO, the company's stock saw a significant drop. Despite this, AI revenue surged over threefold, and new cloud agreements were announced. The capital invested in AI is still high, promising returns in under a year. SpaceX touted faster-than-expected returns from its AI spending on its first-ever earnings call as a public company. But investors remained concerned about how long its profitable Starlink business could continue to bankroll costly investments in data centers and Nvidia chips. US MarketsPowered By As on 05 Aug 2026, 07:10 PM IST S&P 500 Top Gainers Charles River259.56(10.87%) Wynn Resorts107.66(10.31%) Eli Lilly1,195(7.13%) Intl Flavors & Fragrances86.33(6.73%) Gainers" S&P 500 Top Losers Insulet134.01(-19.67%) CDW126.12(-18.10%) DaVita188.67(-17.25%) Coterra Energy32.56(-8.62%) Losers" The company's shares fell about 12% on Wednesday, dropping well below their $135 IPO price in less than two months since the company's blockbuster debut. "With capex expected to remain elevated and investor enthusiasm cooling, I believe the stock could remain under pressure ahead of the lock-up expiration," said Carolane de Palmas, market analyst at brokerage ActivTrades. "That could translate into significant volatility as markets reassess SpaceX's valuation and cash-burn trajectory." SpaceX reported AI revenue that more than tripled from a year earlier ⁠and disclosed several ⁠new cloud computing agreements, even as quarterly capital spending on AI climbed to $15.8 billion. Chief Financial Officer Bret Johnsen said the economics of those investments were improving rapidly, but also signaled that AI spending would remain elevated. "The current economics have translated into a less than one-year payback on our new capital deployments for compute," Johnsen said, adding that SpaceX had signed another $6.7 billion in cloud computing contracts since the end of the second quarter and was on track to reach a $100 billion annualized revenue run rate by the end of the year. That stands in contrast to traditional data center investments, which typically take years to recover their upfront costs. "Elon has continued to surprise investors on what innovation and technology can do, but there has always been a mismatch in terms of the ⁠time frame of when that execution is going to occur," David Wagner, portfolio manager at Aptus Capital Advisors, said, referring to Musk's often-rosy outlook at his EV company Tesla that he has regularly missed. "I believe the numbers. I would say that yes, those numbers are aggressive, but ⁠it's not a fantasy. The pieces exist, they just require flawless execution." THE AI PAYBACK BET The comments at the post-earnings call marked a shift in the investment debate surrounding SpaceX. Before the earnings release, investors largely viewed Starlink's growing cash flows as the primary source of funding for the company's AI ambitions. Management is now arguing that AI infrastructure itself is beginning to generate enough revenue to finance further expansion. To be sure, the company spent about $18.4 billion on capital expenditures during the quarter, roughly a fifth of the $85.7 billion it raised in its June IPO, and remained deeply free cash flow negative as it continued investing heavily in AI infrastructure. "We've watched the same scrutiny land on Big Tech this earnings season, where investors have questioned open-ended wallets and started demanding a visible return on them," said Josh Gilbert, lead analyst at trading platform eToro. "SpaceX faces that test with an added degree of difficulty because it's asking shareholders to bankroll data centres in orbit." SpaceX's AI business generated $2.6 billion in second-quarter revenue, up more than three-fold from a year earlier although it remained loss-making on an operating basis. Even so, the company is not easing off its spending. ⁠Johnsen said capital expenditures over the next two quarters would likely remain at levels similar to the second quarter as SpaceX continues expanding AI compute capacity, Starship production and next-generation Starlink satellites. "New compute capital monetizes so fast it behaves more like cost of goods than capex," said Michael Monaghan, portfolio manager of the Founders 100 ETF, which holds SpaceX shares. SpaceX executives said demand for AI computing continues to outstrip supply and that they expect to end the year with more than two gigawatts of compute capacity. If demand remains strong enough to keep that infrastructure fully utilized, AI could increasingly fund its own growth rather than relying on Starlink's cash generation. "The relationship between capex and revenue is unsustainable, so capex has to fall or revenue has to grow tremendously, and that is where faith in Musk's vision, engineering leadership and execution track record separates the bulls from the bears," said Drew Cupps, portfolio manager at Polen Capital, which holds a position in SpaceX.

Argus upgrades SpaceX and calls its AI spending a strength

Two days before Argus Research spoke, investors were heavily selling SpaceX (SPCX) stock. The company had just posted its first earnings report as a public firm, and the market focused on one number: how much SpaceX is spending on artificial intelligence. The stock fell. Then Argus looked at the same report and reached the opposite conclusion. On August 7, the firm upgraded SpaceX to Buy from hold. The market had been treating AI spending as a problem. Argus decided it was the reason to own the stock. Shares responded fast. SPCX rose 15.8% in a single session, closing at $133.11. For investors, the difference in views raises a practical question. When a stock drops on the same news that makes one firm bullish, who is reading it correctly, and what should you do about it? What the Argus upgrade actually says about SpaceX stock Argus analyst Steven Silver moved SpaceX to Buy and set a $160 price target, according to CNBC. That target sits well above where the stock trades now. From the $133.11 close on August 7, $160 implies room to rise further. Silver's reasoning is direct. He said he is encouraged by the fast payback on SpaceX's AI spending, because the company is adding computing capacity quickly. The $160 target values SpaceX at about 20 times its estimated 2027 revenue, TipRanks reported. Argus expects that revenue to reach $110 billion in 2027. That is a high multiple. It only holds if SpaceX keeps growing at the pace it just showed. Why SpaceX's AI spending scared the market first SpaceX spent $18.4 billion on capital projects in the second quarter. About $15.83 billion of that went to AI infrastructure, far above what analysts had modeled, CNBC reported. Wall Street had estimated roughly $13 billion. The real figure was much larger, and management signaled similar spending ahead. SpaceX is pouring cash into data centers and computing power now, and the payoff comes later. When a company spends that far ahead of its earnings, investors worry the returns may never catch up. That fear drove the sell-off. The AI segment still lost money in the quarter. Its operating loss was about $1.3 billion. NurPhoto / Getty Images How Argus reads the same numbers differently Argus did not get new data. It weighed the numbers already released and judged the spending as an investment that is working. The key figure is a comment from SpaceX finance chief Bret Johnsen. He said the company is getting less than a one-year payback on some of its AI computing spending, according to Benzinga. A one-year payback means the money spent on a data center is earned back within about 12 months. That is fast for infrastructure this large. The demand behind it is real. SpaceX signed $14.1 billion in new cloud contracts during the quarter, then added $6.7 billion more early in the third quarter. Its AI revenue rose 247% from a year earlier, to about $2.56 billion. Customers already include Google and Anthropic. The revenue growth that supports the bull case Behind the AI debate is a business growing quickly. SpaceX reported second-quarter revenue of $7.81 billion, up 92% from a year earlier. That beat the $6.93 billion analysts expected. Its net loss narrowed to $541 million. Starlink, the satellite internet service, remains the engine. It posted a $1.66 billionoperating profit in the quarter and now serves 12 million subscribers across more than 160 markets. The company projects an annualized revenue rate approaching $100 billion by the end of 2026. Elon Musk moved his $1 trillion annual revenue goal forward to 2030 from 2031. Those are targets, not results. But the quarter gave the bulls, including Argus, a concrete reason to believe the growth is arriving. SpaceX stock since its IPO SpaceX went public on June 12 at $135 a share. It climbed above $225 within its first week, then fell for five straight weeks. Since the public offering SPCX is down about 17%. The stock sits well below its June high of $225.64, which is also its 52-week high. The broader market went the other way. The S&P 500 is up about 13% for the year, as of early August. So a buyer of SPCX at the IPO is still losing money on that trade, while a buyer of an index fund has made a gain. That gap is exactly what Argus is betting will close. What still has to happen for the $160 target to work An upgrade is a forecast, not a guarantee. Several things must go right for SpaceX to reach $160. Four things the bull case needs * AI revenue keeps scaling. The $2.56 billion needs to keep climbing to justify the spending. * The AI segment turns profitable. It reached positive adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA), but still loses money on an operating basis. * Selling pressure fades. On August 6, a lockup ended and freed 911.5 million insider shares, more than doubling the tradable float. * Spending stays disciplined. Full-year capital spending is tracking toward roughly $65 billion. Other firms remain more cautious. Piper Sandler holds a neutral rating with a $140 target, citing valuation and the end of the share lockup. What investors should take from the Argus call Argus's upgrade is not a guarantee that SpaceX stock will climb back up soon. It tells you that at least one experienced firm sees SpaceX's AI spending as a good move, and it puts a target of $160 on that view. However, the stock is volatile, and more shares will keep unlocking through December. That means further price swings are likely, regardless of what the long-term outcome may be. A practical approach lies in these two questions: First, do you believe SpaceX can turn its spending into profit over several years? Second, is today's price a reasonable entry point given the possibility of more near-term selling? Argus answered yes to the first. The second is a decision only you can make. The Arena Media Brands, LLC THESTREET is a registered trademark of TheStreet, Inc. This story was originally published August 9, 2026 at 5:37 PM.

US stocks: SpaceX quarterly revenue surges in debut results on strong growth in its Starlink business

SpaceX has announced an impressive 92% increase in revenue for the latest quarter, primarily fueled by the growth of Starlink and its AI initiatives. Despite this surge, the firm faced a net loss due to significant capital allocated towards infrastructure and future projects. After a strong IPO, its stock is now under scrutiny, especially with the impending lock-up expiration. SpaceX reported on Tuesday a 92% rise in revenue for the April-June quarter, in its first earnings since going public, buoyed by strong growth in its Starlink satellite-internet and AI businesses. It reported revenue of $7.8 billion, compared with $4.1 billion a year earlier. US MarketsPowered By As on 05 Aug 2026, 01:12 AM IST S&P 500 Top Gainers Palantir Technologies162.60(29.41%) Zebra Technologies365.35(25.27%) Gartner187.59(23.79%) Intel100.75(10.71%) Gainers" S&P 500 Top Losers NRG Energy114.49(-17.32%) Aptiv47.76(-16.56%) Coterra Energy32.56(-8.62%) Chipotle Mexican Grill34.29(-8.48%) Losers" Second-quarter revenue beat expectations of $6.93 billion, according to LSEG data. The company posted a net loss of $541 million attributable to shareholders for the three months ended June 30. The company said it invested $18.37 billion in AI infrastructure, Starship and Starlink expansion. The company's stock has declined 8% since its record-breaking initial public offering in June that valued ⁠the company at ⁠about $1.75 trillion. The stock could face additional pressure from the expiry of SpaceX's post-IPO lock-up period starting on Thursday, which may unleash a wave of insider and early-investor shares on the market. Starlink and SpaceX's broader connectivity operations remain the company's primary financial engine, underpinning CEO Elon Musk's push to build an AI-first business that extends beyond renting compute capacity to developing frontier models, consumer and enterprise software, and, eventually, data centers in space. The company's satellite-internet unit has continued to expand its global subscriber base, aided by launches of additional satellites and a growing range of consumer, enterprise, aviation, maritime and government services. But that expansion has come with tradeoffs: average revenue per ⁠user (ARPU) has dropped as SpaceX has entered more international markets and rolled out lower-priced plans. Investors are watching whether SpaceX can maintain growth while improving the economics of its network, particularly as it spends heavily to expand coverage, increase ⁠capacity and develop direct-to-device mobile services. SpaceX's AI business, which includes xAI, Grok, and social-media platform X, and a rapidly expanding data center operation, has been its biggest area of investment. The business is generating revenue from compute contracts with Anthropic, Alphabet's Google and Reflection AI, though a portion of its recurring revenue has yet to be recognized. Operating losses at the AI business have mounted, and SpaceX has cautioned that the AI unit will require sustained investment before it can generate profits consistently. Starship, SpaceX's next-generation reusable rocket system, is yet to enter commercial service but is expected to enable deployment of higher-bandwidth Starlink satellites and orbital AI-computing infrastructure. The company's ability to turn Starship into a reliably reusable vehicle is central to its longer-term strategy. Investors have closely watched for updates on testing progress, launch cadence, reusability milestones and the vehicle's satellite-deployment capabilities. Separately, SpaceX said that it had partnered with Nvidia to use its chips in the Starmind AI1 orbital compute satellites. The space segment, which includes ⁠commercial launches, government missions and development of Starship remains a significant source of costs and uncertainty. While launch activity for Falcon - SpaceX's partially reusable workhorse rocket - has remained robust, revenue can vary with the mix of internal Starlink deployments, commercial customer missions and government contracts. In recent years, SpaceX has increasingly prioritized launches for its own satellite network over third-party payloads, while continuing to absorb significant costs tied to Starship's development. Investors will also be keen to hear Musk's comments on a potential merger between SpaceX and Tesla after a Wall Street Journal report last week that executives at his electric-vehicle company had been told to prepare for a separation of its China business ahead of a potential deal. Musk dismissed the report as "fake news," but he had previously declined to rule out the possibility, citing growing overlap between the companies.

Bank of America reiterates Buy rating on SpaceX after earnings

SpaceX (SPCX) stock investors are still reeling from a post-earnings sell-off, digesting a quarter dominated by soaring CapEx and growing questions over cash generation. Before the report, Wall Street was looking for strong headline numbers but remained mostly skeptical of its ability to expand AI, satellite, and mobile ambitions to justify the sheer amount of investment. Management's plan to maintain similar spending levels through the back half confirmed those fears. Yet in a note shared with me, Bank of America saw something the market did not. Investors continued punishing the stock for its lofty capex numbers, but the bank materially lifted its long-term forecasts post-earnings, pointing to an unexpectedly powerful growth engine. Why is Bank of America still bullish on SpaceX after earnings? BofA analyst Ronald Epstein and his team remained bullish on SpaceX stock post earnings. The bank reiterated its Buy rating and $235 price target, representing 87.5% upside from the report's reference price of $125.33. The core of what's driving the bank's conviction is mainly SpaceX's AI economics, instead of its traditional rocket-launch business. BofA says SpaceX's AI segment posted the main Q2 upside, spearheaded by third-party computing sales. Elon Musk's aerospace giant wrapped up the quarter with 1.4 gigawatts of computing capacity, plans to exceed 2 gigawatts by year-end, and expects to reach 5 to 10 gigawatts in 2027. At the top end of that range, capacity may be more than seven times its Q2 level. The bank expects AI sales of nearly $24.5 billion in 2026, equal to over 50% of revised companywide sales forecasts. Put simply, that means AI is no longer a speculative side business inside the SpaceX valuation; it's becoming the core driver of the earnings model. BofA sees further growth because SpaceX's Anthropic agreement only began contributing in May, while its Google computing contract is expected to start firing in October. Siskin/McMullan via Getty Images Earnings estimates were transformed, not merely raised BofA bumped its 2026 sales forecast on SpaceX stock by roughly 15%, to $46.9 billion. Moreover, its 2027 estimates jumped roughly 29% to $100.7 billion, while its 2028 forecast shot up 29% to $184.8 billion. On top of that, its earnings revisions were even more dramatic. BofA moved its 2026 EPS estimate from a 2-cent loss to a 91-cent profit. Additionally, its 2027 EPS forecast jumped more than 50% to $3.19, while the 2028 estimate climbed approximately 93% to $7.29. EBITDA forecasts were raised by 40% to 46% across those three years. That said, the model assumes remarkable operating leverage. BofA expects SpaceX's operating margin to improve from negative 13.9% in 2025 to 24.9% in 2026, then reach 41.9% in 2027 and 51.8% in 2028. Yet the company is still expected to burn a ton of cash. BofA projects negative free cash flow of $43.6 billion in 2026, $45.4 billion in 2027, and $37.4 billion in 2028, as capex rises toward $167.5 billion. BofA therefore expects earnings and operating profits to improve far quicker than actual cash generation. Why BofA is less alarmed by the capex surge SpaceX dropped a massive $18.4 billion on capex during the quarter. Though that was slightly behind BofA's estimate, its management indicated that spending will remain close to that level through the second half. That forecast compelled BofA to raise its 2026 CapEx forecast to $67.3 billion from $48.2 billion, a 40% revision. The new estimate implies nearly $13 billion over second-half spending, compared to consensus expectations, and $18 million higher than what BofA previously modeled. It's important to note, though, that BofA distinguishes SpaceX's spending from conventional long-duration infrastructure investment. Roughly 86% of Q2 CapEx, or nearly $15.8 billion, went toward AI. Management said those investments are reaching cash break-even in less than one year as demand sped past available supply, backing up unusually strong pricing for third-party capacity. That claim is critical to BofA's bullishness. A sub-one-year cash payback makes the current capex surge economically rational, even if it appears alarming on the cash-flow statement. At the same time, it introduces a major risk. Those returns depend heavily on today's shortage of computing capacity. As SpaceX, hyperscalers, and specialized cloud providers add supply, pricing will likely normalize and lengthen those payback periods. How much value has SpaceX lost, and could selling worsen it? SpaceX shares traded at $108.27, following a 14% post-earnings plunge on Aug. 5, according to Yahoo Finance. The stock ended the previous day near $125.28, which meant the earnings fallout erased roughly $223 billion in market value at the Aug. 5 close. Since pricing its IPO at $135 and a $1.8 trillion valuation, SpaceX has dropped about 17% at $112, wiping out $300 billion in equity value. Moreover, it remains roughly 50% below its post-IPO peak. The next pressure point arrived Aug. 6, when up to 911.5 million insider shares, worth roughly $100 billion, become eligible for sale. Not every holder will sell, but it unlocks double the thin public float, raising supply and volatility. In addition, according to Barchart data, SpaceX stock has tanked 28.3% over the past 20 trading days and another 2.8% over five days. Its 20-day average true range is $11.28, meaning the shares have moved by nearly 10.3% per session, underscoring incredible volatility. Meanwhile, its nine-day relative strength index sits near 38, indicating sluggish momentum. What investors need to see for the $235 target to hold BofA's $235 price target is based on a discounted cash-flow analysis of bull, base, and bear scenarios stretching through 2045. Apart from being an unusually long period of time, it uses a 5% long-term growth rate and discount rates ranging from 14% to 28%, underscoring high uncertainty surrounding the business. Even after the stock's decline, SpaceX remains remarkably expensive based on near-term earnings. BofA's estimates imply a 137.7x PE ratio, but that figure drops to 17.2x if the company can deliver quadruple-digit earnings growth from 2026 levels (a tall order, to say the least). The next big catalyst is Starship Flight 14, expected in late August or early September. BofA will be monitoring whether the upper stage can potentially reach orbit, survive reentry, and demonstrate a controlled tower landing. Success will strengthen the case for rapid reusability, lower launch costs, and eventual orbital computing infrastructure. So Starlink Mobile offers a major opportunity, but it's not without its caveats. SpaceX is looking to deploy its own terrestrial infrastructure and compete head-on with U.S. wireless carriers instead of relying entirely on mobile-network partners. Going alone would improve long-term unit economics but would entail a lot more capital and expose SpaceX to greater regulatory and competitive risks. The Arena Media Brands, LLC THESTREET is a registered trademark of TheStreet, Inc. This story was originally published August 6, 2026 at 6:47 PM.

SpaceX Revenue Hits $7.8B as AI Investment Push Weighs on Stock Price

The company reported second-quarter revenue of $7.8 billion, marking a 92% increase from the same period last year. However, SpaceX recorded a net loss of $541 million as capital expenses and research costs increased. Meanwhile, SpaceX reported growth across its three main business areas, including space operations, connectivity services and artificial intelligence. The company's revenue increased from $4.02 billion in the second quarter of 2025 to $7.81 billion in the same period of 2026. Starlink remained the largest revenue contributor during the quarter. The satellite internet business generated $4.29 billion in revenue, up from $2.59 billion a year earlier. The company said Starlink's subscriber base reached 12 million users, supported by growing demand for satellite internet services. Elon Musk said during the earnings call that Starlink could eventually provide internet access to a large share of the global population. "It's not out of the question that, at some point, Starlink will deliver a majority of the world's internet," Musk said. SpaceX's artificial intelligence business also recorded strong revenue growth. AI-related revenue increased to $2.56 billion in the second quarter from $737 million a year earlier. The company provides computing capacity for AI projects and works with companies including Google and Anthropic. SpaceX said it currently operates 1.4 gigawatts of capacity and plans to expand that capacity to at least 10 gigawatts next year.

SpaceX shares tank 10% as jaw-dropping AI spending jump spooks investors

SpaceX shares tanked nearly 10% Wednesday after it revealed a massive jump in spending on AI investments - adding to Wall Street jitters over a possible "AI bubble" in the market. In its first earnings report as a public company Tuesday, Elon Musk's rocket-launch firm said its capital expenditures jumped sixfold in the second quarter to $18.4 billion, with the majority going toward AI infrastructure. The stock fell to roughly $113.27 Wednesday morning - below its $135 IPO price and its roughly $200 all-time high that was hit shortly after its record-breaking market debut in June, which raised $86 billion. SpaceX also disclosed a 92% surge in revenue and a smaller-than-expected loss of $541 million in the second quarter - but investors were more concerned about its massive spending plans. Tech and chip stocks, particularly those with the most exposure to AI, have suffered choppy trading sessions for months as traders panic that massive spending might not see commensurate returns, potentially recreating the "dot-com bubble" of the early 2000s. Since its IPO, SpaceX's stock has plummeted more than 20%, wiping out roughly $500 billion in value. During an earnings call Tuesday, SpaceX CFO Bret Johnsen tried to reassure investors, saying the company has been "efficient" with its spending. "On the AI compute side, we're able to deploy capital in such a way that we're getting less than a one-year payback," Johnsen said. OpenAI's ChatGPT and Anthropic's Claude models are the top contenders in the AI sphere, but SpaceX has attempted to carve out its own niche by renting out the computing capacity it is building with Nvidia chips. Other tech giants, like Meta, have also floated the idea of renting out their compute as a way to generate revenue in the near-term. After its earnings report, SpaceX - which has touted grand ambitions like building data centers in space and colonizing Mars - also served up an optimistic forecast as Musk said the company would hit $1 trillion in annual revenue in 2030, sooner than a previous forecast of 2031. But the company is expected to suffer more volatility this week as millions of SpaceX shares will become eligible for sale on Thursday. Insider lock-ups on roughly 911.5 million shares held by employees and early investors will expire Thursday, potentially resulting in a wave of share sales. SpaceX opted for a staggered expiration of lock-ups, so more restrictions will be lifted in the coming months. By December, an additional 40% of the company could be tradable, while the remaining 60% - including Musk's stake - will face restrictions until the middle of 2027.

SpaceX posts loss in first report as a public company but less than expected

NEW YORK -- SpaceX reported a smaller loss than Wall Street expected along with a surge in revenue in its first quarterly report as a public company as it sharply boosted spending, particularly on artificial intelligence. The company run by Elon Musk posted a loss of US$541 million, or 9 cents per share, in the three months through June, less than half what financial analysts had forecast. Revenue jumped to $7.8 billion, up more than 90 per cent from the year-earlier period. A standout in the quarter was the company's big cash source, its "connectivity" business, with revenue jumping 66 per cent from a year earlier as the number of subscribers to its Starlink satellite communications service doubled to 12 million. "It's not out of the question that at some point, Starlink will deliver a majority of the world's internet," Musk said in call with analysts. SpaceX stock rose 9 per cent in regular trading Tuesday, but gave most of the gain back after hours. The rocket, satellite and AI company's stock has fallen by roughly half since peaking in June shortly after an initial public offering that briefly made Musk the world's first trillionaire. Investors are worried Musk has oversold them on the company's future prospects for space travel and its AI chatbot Grok. They're also bracing for volatile trading as some company insiders get the opportunity to sell shares after the expiration of what's known as a lockup provision later in the week. Another area of concern is SpaceX spending on infrastructure and R&D, which jumped to $18 billion from less than $3 billion a year ago. The company's chief financial officer, Bret Johnsen, said to expect similar capital expenditures for the next two quarters. Musk defended the outlays, a concern also weighing on many other technology companies spending heavily on AI, saying the resulting supercharged growth meant the company would reach a trillion dollars in revenue a year faster now, 2030 rather than 2031. Shares jumped 19 per cent on their first day of trading in June, making Musk the first-ever trillionaire. The subsequent drop, as well as a decline in the shares of Musk's electric vehicle company Tesla, have knocked his wealth down to $783 billion, according to Forbes. Musk was asked several times about the prospects for the gigantic Starship rocket that is key to SpaceX realizing his ambitions. Starship successfully deployed satellites in space during a test late last month. Musk said he expected SpaceX will attempt to test the reusability of Starship at the end of the month when it will attempt to grab the spacecraft and its booster with mechanical arms upon their return to their base. NASA hopes to use Starship to put astronauts on the moon again in the near future. "We want to put boots on the ground -- boots on the moon -- in 2028," said SpaceX President Gwynne Shotwell. SpaceX shares could see continued volatility. Some insiders have been barred from selling in the public offering but that prohibition begins to ease on Thursday when more than 900 million shares are released for trading, more than doubling the amount currently available. The lockup release is the first of several tranches of stock that will be freed to trade over the next several months. The company also runs the social media platform X, formerly Twitter.

UBS reiterates SpaceX stock rating on strong AI revenue growth By Investing.com

Investing.com - UBS reiterated a Buy rating and $210.00 price target on SpaceX (NASDAQ:SPCX) following the company's first earnings report. The space company reported total revenues of $7.8 billion, up 92% year-over-year, exceeding UBS's estimate of $7.1 billion and the Street consensus of $6.8 billion. EBITDA rose 192% year-over-year to $3.5 billion, compared to UBS's estimate of $2.2 billion and Street expectations of $2.0 billion. AI cloud service deals drove the revenue and EBITDA outperformance. Capital expenditures totaled $18.4 billion, resulting in total cash burn of $16 billion, slightly above UBS's estimate of $15 billion. The stock, which trades at a market cap of $1.54 trillion, jumped over 11% in the past week following the earnings release, though InvestingPro analysis suggests the shares are currently overvalued relative to its Fair Value. SpaceX completed Starship Flight 13 during the quarter. Management indicated the company will attempt to catch Ship 41 on its next test flight, tentatively scheduled for the end of August. UBS analyst John Hodulik maintained the Buy rating and $210.00 price target on the stock. While the company remains unprofitable over the last twelve months, InvestingPro Tips indicate analysts predict profitability this year -- one of 13+ exclusive tips available to subscribers, along with comprehensive Pro Research Reports covering SPCX and 1,400+ other US equities. In other recent news, SpaceX reported impressive second-quarter earnings, with revenue reaching $7.8 billion, marking a 92% increase year-over-year and surpassing expectations by about $1 billion. The company also posted an adjusted EBITDA of $3.5 billion, significantly exceeding the $1.99 billion estimate, with a margin of 44.9%. Analysts from Raymond James have reiterated a Strong Buy rating with an $800 price target, reflecting confidence in the company's performance. Stifel also maintained a Buy rating, noting the substantial revenue growth and contributions from Cloud Service Agreements, which added $1.6 billion in the second quarter. BofA Securities reiterated a Buy rating, highlighting SpaceX's outperformance in revenue and profitability metrics. Wolfe Research emphasized the strength of SpaceX's AI division, which generated $1.1 billion in EBITDA, swinging to a profit and exceeding their expectations. Mizuho maintained an Outperform rating with a $200 price target ahead of a significant lockup expiration, where 911.5 million shares will become eligible for sale. These developments underscore SpaceX's robust financial health and growth potential. This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.

SpaceX's first results put Elon Musk's AI spending under Wall Street microscope

SpaceX is poised to reveal its next earnings report, signaling Starlink's profitability and its pivotal role in financing AI and space initiatives. Analysts predict notable advancements in Starlink and AI ventures for the April-June quarter. A key area of interest for investors is SpaceX's sizable investments in AI technology, while Starship's development is integral to the company's future aspirations and investor confidence. SpaceX's first earnings report since its record-breaking IPO will provide an early gauge of whether Starlink's profits can sustain the company's rapidly growing spending on AI and space ventures. Due after the market closes on Tuesday, the results will give SpaceX's limited pool of public investors their first chance to judge whether the financial case behind the company's lofty valuation supports CEO Elon Musk's vision of a powerhouse spanning AI, space and telecommunications. Musk has pitched AI as SpaceX's future growth engine, with ambitions extending beyond renting compute capacity to other companies to developing frontier models, consumer and enterprise software, and, eventually, data centers in space. But until its AI business and Starship launch operations can stand on their own, Musk plans to use Starlink's profits to bankroll both ventures, a strategy ⁠critics argue ⁠is unsustainable. "Starlink is executing beautifully, but it cannot single-handedly fund a $30 billion annualized AI capex program," said Will Rhind, founder and CEO of GraniteShares, an asset manager that offers ETFs tied to SpaceX stock performance. Analysts expect the AI business to nearly triple to $2.33 billion in the April-June quarter, up sharply from 12.5% growth in the prior quarter, according to LSEG-compiled data. Starlink growth is also expected to accelerate to 52.6% from 31.6%, driven mainly by expansion into more countries. SpaceX's AI expansion consumed $7.72 billion in the January-March quarter, accounting for about three-quarters of the company's total capital spending. Analysts expect SpaceX to report capital expenses of nearly $14.05 billion in the April-June quarter. Capital spending in the AI segment is expected to surge more than six times to $10.2 billion from the same period last year, according to Visible Alpha data. SpaceX shares have pulled back sharply since the company's $86 ⁠billion IPO in June, as investors questioned whether its lofty valuation of 77 times expected revenue can be justified. The stock could face additional pressure from the expiry of SpaceX's post-IPO lock-up period starting August 6, which may unleash a wave of insider and early-investor shares on the market. Investors will also be keen ⁠to hear Musk's comments on a potential merger between SpaceX and Tesla after a media report emerged last week that executives at his EV company had been told to prepare for a separation of its China business ahead of a potential deal. Musk dismissed the report as "fake news," but he had previously declined to dismiss the possibility, citing growing overlap between the companies. Compute revenue in focus Analysts expect revenue from connectivity (Starlink) of $3.82 billion and operating profit of $1.42 billion in the second quarter ended June 30. In the first quarter, operating profit was $1.19 billion. At the end of March, Starlink had 10.3 million subscribers, roughly double the level a year earlier, though average revenue per user fell nearly 25%. SpaceX has signed AI compute agreements with customers including Anthropic, Alphabet's Google and Reflection AI, but that may not be enough. "The key question for investors is whether SpaceX can monetize its AI infrastructure through third-party compute fast enough to offset xAI's extraordinary capital intensity," said Michael Monaghan, portfolio manager of the Founders 100 ETF, which holds SpaceX shares. MoffettNathanson analyst Julie Zhu expects SpaceX's AI business to generate positive core profit this year, helped by infrastructure agreements, although she said the gains would be tempered by the segment's significantly higher capital spending requirements."This is not going to be a ⁠free cash flow story now, soon, or maybe even ever," said Bill Birmingham, managing director at REX Financial, which offers ETFs tied to SpaceX stock. For the whole company, analysts expect SpaceX to report second-quarter revenue of about $6.93 billion and loss before interest and taxes of $1.55 billion. Starship remains key Many investors still view Starship as SpaceX's most important asset and the key to Musk's long-term vision, underpinning plans to expand Starlink, land astronauts on the moon for NASA by 2028 and eventually deploy AI-processing satellites in orbit. Last month, Starship successfully deployed the first upgraded Starlink V3 satellites after its 13th test flight, but the Super Heavy booster fell short of a controlled splashdown. Analysts expect SpaceX's launch business to generate $871.4 million in second-quarter revenue, while posting an operating loss of $773 million. In the January-March quarter, operating loss surged ninefold from a year earlier, and revenue fell 28.4% to $619 million. "The progress on Starship is essential for demonstrating to investors that the company is on the desired trajectory," said Micah Walter-Range, a space industry specialist who helped develop the index tracked by the Procure Space ETF.

SpaceX's AI ambitions burning through Starlink revenue

STORY: :: Joey Roulette, U.S. Business of Space Correspondent :: Washington, D.C./ August 4, 2026 "SpaceX's first earnings call really affirmed that the company is very serious about all the plans that it wants to do in the artificial intelligence sector building data centers in space and on land. And it affirmed that Starlink remains the primary driver of the company's overall revenue that's going to fund all of these expensive projects." "So SpaceX's overall revenue roughly doubled, and that was driven mainly by Starlink, which accounted for about 66% of its quarterly revenue. And so overall that's $7.8 billion in revenue this quarter, which is up from about $4.1 billion from the previous year." "While SpaceX is bringing in that much money, it's also spending a lot more. $18 billion in spending overall, which is up from $2.8 billion a year prior. They're building out lots of data centers and AI infrastructure on Earth. And then they're also investing heavily in their plans to move all of those systems into space with their Starmind AI satellites, which is a longer term goal." "But AI aside, Starlink is still the most powerful unit within SpaceX that's funding these giant development efforts." "Subscribers have jumped to 12 million, which is millions more than last year. And we're expecting those numbers to even grow, because SpaceX wants to put thousands of other upgraded Starlink satellites in space that Elon Musk says will expand the network's capacity by like 10 times." "However, one thing Elon said on the earnings call was that they aim to launch some of those first AI satellites as soon as next year. But it's going to take a lot more to actually build up enough power to have a data center that rivals those on Earth, and that can take several years. So what SpaceX is focused on right now is competing in the AI industry as an infrastructure provider."

SpaceX's first quarterly results as a public company beat expectations, but AI costs hit stock

NEW YORK, Aug 4 (Reuters) - SpaceX on Tuesday posted its first quarterly results as a public company, highlighting a 92% rise in revenue on strong growth in its Starlink satellite-internet and AI businesses. Revenue for the second quarter ended in June rose to $7.8 billion from $4.1 billion a year earlier, beating the $6.9 billion consensus estimate. The firm lost 9 cents a share, beating the 26-cent loss expected by analysts. Shares fell 4% in late trading on Tuesday after rising 9.4% in regular action. The report has been widely anticipated on Wall Street in part because the earnings release will be followed this week by the unlock of 911 million shares previously subject to restrictions -- an event that stands to add to the already significant pressure on the shares of Elon Musk's rockets-and-AI firm. SpaceX has risen more than 10% this week but remains below the $135-a-share price at which it raised $75 billion in June in the largest-ever public offering. The stock's decline means that an additional 455 million shares that could have been unlocked this week had SpaceX shares risen above certain stated thresholds will remain ineligible for release for now. COMMENTS: BRIAN MULBERRY, CHIEF MARKET STRATEGIST AT ZACKS INVESTMENT MANAGEMENT, GOLDEN, COLORADO: "The two things that stood out to me are the doubling of Starlink subscriptions from 6 million to 12 million...and then the actual AI revenue was up 350%. ... Those two numbers were absolutely the biggest outperforming data points. "I think that's a tremendous upside surprise today alone is the fact that AI is already monetizing itself. They're not relying on Starlink to fund operations there. I think that's a huge part of the story. "If they can continue to build on this number and continue to monetize AI directly, then it really does soften our concerns about the capex being a little bit too heavy. I think that this is one of those types of results that will change our thinking and might move up our scale in terms of when we want to take a position." ADAM SARHAN, CHIEF EXECUTIVE, 50 PARK INVESTMENTS, NEW YORK: "They made it very clear this is not a quarter-by-quarter play. Elon's mission is a long-term mission... it's perfectly normal to see fluctuations around highly anticipated IPOs within the first year, if not the first two years, of coming out and starting to trade. "Revenue jumped 92% but AI costs were high. But revenue jumped, so clearly they're doing something right. "But they have to meet and exceed Wall Street's already lofty expectations, and that becomes a very difficult thing for any company to do let alone an extremely popular IPO." (Reporting by Akash Sriram, Caroline Valetkevitch; editing by Colin Barr)

SpaceX posts a strong market debut powered by Starlink and artificial intelligence

SpaceX reported revenue of $7.8bn in the second quarter, up 92% year over year, thanks to progress at Starlink and growth in its artificial intelligence operations. Despite the numbers, the stock fell nearly 5% in after-hours trading. The shares could also face additional pressure as the lockup period for legacy shareholders ends. Starlink remains SpaceX's main financial engine, supported by the expansion of its global satellite internet network across consumers, businesses, the aviation and maritime sectors, and government customers. That growth, however, has come with a decline in average revenue per user, the result of an international expansion strategy built on more competitive offers. Investors are now watching whether the group can improve the network's profitability while continuing to scale it. The artificial intelligence activities, which include xAI, Grok, the social network X and a rapidly expanding data center infrastructure (Colossus), now represent SpaceX's largest investment line item. The division is already generating revenue through contracts signed with Anthropic, Alphabet and Reflection AI, but its operating losses continue to widen. The group says substantial investment will remain necessary before it can reach sustainable profitability. On the space side, the development of Starship remains a key part of SpaceX's long-term strategy, with the goal of deploying next-generation Starlink satellites and AI-dedicated orbital computing infrastructure (the Terafab project). The group also announced a partnership with Nvidia to integrate its chips into Starmind AI1 satellites. Markets will also be watching Elon Musk's comments about a potential merger with Tesla, a possibility he has declined to rule out despite a denial of recent press reports.