SpaceX Stock Rockets Nearly 10% as Revenue Soars 161% and Elon Musk Opens Door to Possible Merger With Tesla

NEW YORK — SpaceX shares jumped nearly 10% in early trading Wednesday. The rocket and satellite company reported third-quarter results well above Wall Street expectations, and CEO Elon Musk said SpaceX and Tesla have formed committees to study a possible merger.

The stock rose $14.34 to $162.13 shortly after the opening bell, up 9.7%. The gain lifted SpaceX's market value to about $2.1 trillion.

Blowout quarter

SpaceX reported third-quarter revenue of $14.58 billion after the market closed Tuesday. That was up 161% from $5.6 billion a year earlier and well above the $12.72 billion analysts expected, according to LSEG.

Adjusted earnings were 45 cents per share, compared with expectations of 13 cents. The company reported net income of $4.4 billion, compared with a net loss of about $1.1 billion a year earlier. Operating income was $2.8 billion, and adjusted earnings before interest, taxes, depreciation and amortization rose 306% to $8.8 billion.

"We delivered another strong quarter in Q3," SpaceX's chief financial officer told analysts on the earnings call.

AI business leads growth

The biggest driver was SpaceX's Super Intelligence segment. That business includes a cloud service that rents AI computing power to companies such as Anthropic. Segment revenue rose to about $7.6 billion, up roughly $5 billion from the second quarter and up about ninefold from a year earlier. The total included $608 million from the acquisition of coding company Cursor, which closed about halfway through the quarter.

SpaceX said it ended the quarter with 1.7 gigawatts of computing capacity, and more data centers came online in early October.

Musk said on the call that large cloud companies and smaller firms have been asking to rent more computing power. He said SpaceX could rent out its capacity several times over if it accepted every request. The comment boosted AI infrastructure stocks in after-hours trading.

Starlink, SpaceX's satellite internet service, also continued to grow. Subscribers reached 13.6 million, and connectivity gross margins were about 55%. The company completed 12 customer launches in the quarter, including the first revenue-generating flight of its Starship rocket.

Heavy spending

The growth requires enormous investment. SpaceX spent $19.6 billion on capital projects in the third quarter, mainly for AI computing, Starship infrastructure and satellite production. The company expects fourth-quarter spending of $35 billion to $40 billion, roughly double the third quarter.

Tesla merger question

The earnings call also raised the possibility of a much bigger deal. Musk said a merger between SpaceX and Tesla, his electric vehicle company, would be a "good idea." He said both boards have formed special committees of independent directors to evaluate a combination.

Musk said talks are at an early stage, no terms have been set, and he is not on either committee. He said the companies could work together in AI software, chip design, robotics and connectivity, and that any deal would need shareholder approval.

Tesla shares rose more than 2% in premarket trading. Tesla reports its own third-quarter results after the market closes Wednesday, and investors are expected to press executives about the merger idea.

A combination would bring together two of the world's most valuable companies and would likely face close scrutiny from regulators and shareholders, particularly over governance and Musk's large ownership stakes in both.

A volatile start as a public company

SpaceX went public on Nasdaq on June 12 in the largest initial public offering ever. The stock has been volatile since then. By late July, it had fallen about 50% from the peak it reached in the week after the IPO.

This was SpaceX's second quarterly report as a public company. Its results helped lift the broader AI trade Wednesday, along with Super Micro Computer's stronger-than-expected preliminary revenue.

Other space stocks rose more modestly. Rocket Lab and AST SpaceMobile edged higher in morning trading.

Some analysts said SpaceX's strong AI cloud revenue provided early evidence for the bullish case on AI cloud providers during this earnings season. Others warned that the stock could be exposed if merger talks stall or if demand for AI computing weakens, given how quickly the company is spending.