SpaceX third-quarter revenue doubles on AI boom, shares rise
SpaceX reported third-quarter revenue of US$14.58 billion, more than double expectations, driven by surging AI and Starlink growth. AI revenue jumped ninefold to US$7.6 billion, though heavy compute spending weighed on profits. Shares rose about 3 per cent in extended trading.
Elon Musk's SpaceX on Tuesday reported third-quarter revenue of US$14.58 billion, more than double the same period last year and above analyst estimates of US$12.72 billion, according to LSEG data. The company posted a net profit of US$4.4 billion for the three months ended September 30, compared with expectations of US$1.57 billion. Shares rose about 3 per cent in extended trading.
AI revenue surged more than ninefold to US$7.6 billion, mostly from renting out computing capacity to developers such as Anthropic, Google and Reflection AI, rather than from its own models. The AI business, which spans the Grok chatbot, social-media platform X and a fast-growing data-centre operation, accounted for US$16.4 billion of the company's US$19.6 billion in capital spending. SpaceX said it expects capital spending to stay near that level in the near future.
Starlink, the satellite-internet unit, reached 13.6 million subscribers in the quarter, above the 12.19 million analysts expected. However, average monthly revenue per subscriber fell to US$69 from US$99 in 2023 as the company expands abroad with cheaper plans. SpaceX has cautioned that geographic expansion beyond the wealthiest countries could push average revenue per user lower over time.
The AI unit has recorded large operating losses, and SpaceX has warned it will need sustained investment before it can consistently generate profits. Investors are also watching whether the company can improve the economics of its network while spending heavily on coverage, capacity and direct-to-device mobile services.
Starship, SpaceX's next-generation reusable rocket system, has yet to enter commercial service. It is expected to enable deployment of higher-bandwidth Starlink satellites and orbital AI-computing infrastructure. Last month, SpaceX successfully deployed several Starlink satellites in Starship's first orbital test flight, which ended hours earlier than expected after an engine issue.
The space segment, including commercial launches, government missions and Starship development, remains a significant source of costs and uncertainty. Falcon launch activity has stayed robust, but revenue can vary with the mix of internal Starlink deployments, commercial customer missions and government contracts.
Investors will also be keen to hear Musk's comments on a much-talked-about potential merger between SpaceX and Tesla, which reports results on Wednesday.