SpaceX reported its first profit as a public company Tuesday, recording $4.4 billion in net income as well as large third-quarter revenue gains, reflecting a trifecta of growth in its launch, communications and artificial intelligence businesses.
Founder Elon Musk also disclosed that the company and electric automaker Tesla have formed special committees to explore a potential merger, which would rank as the largest of all time.
“I do think there’s a lot of merit to combining the companies,” Musk, the chief executive officer of both companies, said Tuesday on SpaceX’s earnings webcast. “There’s a lot to be gained from cooperating on developing superintelligence software.”
Musk said he isn’t participating in the committee discussions because he is a conflicted party, and that the committees have yet to agree on terms. There has been widespread speculation on Wall Street of such a move.
The news sent SpaceX shares up nearly 8%, or $1.71, to $159.50 in after hours trading. Tesla climbed 1.2%.
The disclosure followed a stellar earnings announcement by the Texas rocket, internet and AI company that easily beat analysts net-income estimates of $1.88 billion for the quarter ended Sept. 30. It was a swing from a $1.1 billion net loss in the second quarter.
Revenues totaled $14.6 billion, nearly double the $7.8 billion second quarter figure. Capital expenditures hit $19.59 billion, mainly for artificial intelligence computing, where SpaceX is competing with OpenAi, Anthropic and other AI leaders.
“Our business is experiencing extremely strong momentum across all three segments,” said President Gywnne Shotwell, in an investors presentation that was live streamed on X and featured a video highlighting the most recent flight of its massive Starship rocket on Sept. 28.
The big earner for the company was its artificial intelligence division, which the company has renamed as its “super intelligence” business, in line with President Trump’s decision in September to rebrand the entire industry.
The division recorded operating income of $431 million for the quarter on revenue of $7.56 billion, reversing a $1.26 billion loss in the second quarter on $2.56 billion in revenue.
The connectivity segment — which includes its lucrative Starlink satellite internet service — reported an operating profit of $2.37 billion on revenue of $5.25 billion, with both figures topping second quarter results.
The business was driven by expansion of its Starlink service, which added 1.6 million subscribers worldwide, excluding enterprise contracts. Shotwell said it is now available in 174 markets with nearly 14 million customers.
The company is also making a play to become a major mobile communications provider, buying up spectrum from other companies. Shotwell said SpaceX has 22 million mobile users worldwide, up 37% from the second quarter.
The space business featured 35 launches in the quarter, including 21 that sent more Starlink satellites into orbit, as well as others for commercial and government customers. It recorded revenue of $5.25 billion, up from $4.29 billion in the second quarter. Losses were cut to $7 million from $542 million in the second quarter.
Musk has said the SpaceX’s future success hinges on its Starship rocket, slated to carry astronauts to the moon and launch hundreds of thousands of communications satellites and orbiting data centers to power its AI ambitions.
The September test flight, its 14th from its south Texas launch site, sent the rocket into orbit for the first time but was cut short due to safety concerns.
Musk spent much of his time during the earnings call touting the Starship program, noting that despite the flight being aborted last month, the massive rocket was able to deploy Starlink satellites with the equivalent data capacity of 10 launches of its smaller Falcon 9 fleet.
On Starship’s next flight, he said, the plan is to capture both the rocket’s first and second stages on the launch pad, a key goal to making Starship fully reusable.
“This is a massive technology milestone,” Musk said. “The only way that we can extend consciousness beyond Earth on a sustained basis is with a fully reusable orbital launch vehicle.”
He also predicted that by the end of next year, the company will be able to launch the rocket weekly or twice a week. While Starship is key for developing the company’s artificial intelligence business, SpaceX is currently building out capacity on land.
SpaceX reported having 1.7 gigawatts of computer capacity at the end of the quarter and is adding more at giant centers in Memphis and Mississippi. The gola is to add 13 more gigawatts by the end of next year, Musk said.
The centers power the company’s lucrative cloud computing services and AI business, including its newly-launched Grokbot AI agent, which Musk said was fast gaining customers.
The earnings report — only the second since the company went public in June — followed a string of news surrounding Musk and SpaceX.
On Sunday, he posted on X that he would give a share of SpaceX to every child in the country, though he didn’t provide details. The offer was an apparent response to an announcement Sunday by Anthropic, the maker of the Claude chatbot, that it would put 5% of its shares into a new Anthropic Public Benefit Fund.
Last week, the Ukranian government blamed temporary speed restrictions imposed by the country’s military grade Starlink communications network for slowing its drones network. Musk said the company had nothing to do with that. There have been reports the U.S. government may have been behind the move.
Founded in 2002 in El Segundo, SpaceX moved its headquarters from Hawthorne to Texas in 2024. However, it retains large operations in the South Bay city and blasts off regularly from Vandenberg Space Force Base in Santa Barbara County.
Shares of the company have rebounded after a sharp drop during the summer following its June 12 IPO, which offered shares at $135. The stock closed up 19% on the first day of trading but reached a low of $104.83 in July.
In its first quarterly earnings release since its $86-billion initial public offering in June, SpaceX in August reported that it grew its revenue and sharply cut its losses while beating Wall Street estimates.
Bloomberg News contributed to this article.
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