SpaceX Post-Earnings: Is It Takeoff or Crash Landing?
Elon Musk's SpaceX—comprising xAI (Grok), X (formerly Twitter), and the rocket company—is looking more like a crash landing than a takeoff, with shares down 11% in after-hours and pre-market trading. SpaceX (SPCX) Earnings Overview
SpaceX (SPCX) delivered its inaugural quarterly report post-IPO, delivering top-line growth driven by Starlink commercial expansion while signaling heavy capital deployment into orbital AI compute. Key Financial Results
Revenue: $11.8 Billion (+42% YoY), beating consensus estimates of $11.2B.
Earnings Per Share (EPS): $0.48 (vs. $0.35 expected).
Starlink Contribution: Represented $7.1 Billion (~60%) of total quarterly revenue, driven by rapid enterprise, maritime, and direct-to-cell subscriber growth.
Launch Operations: Executed 41 successful Falcon and Starship missions during the quarter, generating $3.2 Billion in launch services revenue.
Forward Guidance
FY 2026 Revenue Target: Raised to $48B–$52B (up from prior internal target of $45B).
Capital Expenditures (CapEx): Projected at $18B–$20B for H2 2026, allocated heavily toward Starship fleet scaling and orbital infrastructure.
xAI Integration & Compute: Anticipates first commercial revenue from space-based AI compute clusters by Q2 2027.
Elon Musk’s Earnings Call Highlights
Orbital Data Centers: Musk re-emphasized that low-Earth orbit (LEO) data centers powered by continuous direct solar energy represent the future of scalable AI compute, bypassing terrestrial power grid constraints and land-use bottlenecks.
Starship Manufacturing Scale: Stated that Starship factory throughput is accelerating to support weekly launch cadences aimed at deploying next-generation heavy compute payloads.
Tesla Synergies: Addressed market speculation regarding potential corporate integration with Tesla, clarifying that while joint technology-sharing agreements around battery tech and autonomous software remain active, no formal corporate merger is currently planned.
The Speculation Machine: Early Tesla vs. Modern SpaceX
Mr. Elon Musk is back with his brand-new speculation machine, SPCX—this time much more speculative than Tesla ever was. But for retail investors, is it like investing in the early days of Tesla?
Tesla was an unprofitable company for a long time while promising the future. Those who believed in his vision—or just took a punt on the shares in the early days—were rewarded greatly, and it turned out to be very lucrative for them. The thing is now, he has already done it, so this time around may not be quite like the first.
Is it more profitable for an investor to invest in the next Elon Musk who comes along? Picking that person out can be thought of as gambling, which is why diversification is such a big factor in the world of stock portfolios. Rivalries, Skepticism, and the Cost of Pessimism
Although there is still a lot of speculation to be had in Tesla with Optimus robots, robotaxis, and much more, it is also worth noting Elon has many other private companies such as Neuralink.
Starlink—the satellite internet company that is part of SpaceX (SPCX)—is rolling out internet to airlines, famously rejected by Ryanair's CEO Michael O'Leary. The two had a social media back-and-forth which O'Leary claimed gave him free exposure and sold more airline tickets. Elon won't like this, as he is well known for having issues with public figures.
We all remember one of the best ones: when BBC Top Gear's Jeremy Clarkson upset him in 2008 and was later sued. Clarkson doubted Tesla and Musk from the start and was quite vocal about his pessimism toward Musk and his endeavors. If he had been optimistic, become an early investor, collaborated with Musk, and instead built a relationship, things could have been different for him. Instead of building those relationships, he went on to build a farm. I'm sure Jeremy's grandchildren have feelings about this financial decision and not being so optimistic and speculative.
Often in investing and trading in the stock market, you are either a pessimist or an optimist—both human emotions. Could the lesson be: don't be like Clarkson?