SpaceX’s AI Bet Beats Revenue Targets but Spooks Wall Street

SpaceX’s AI Bet Beats Revenue Targets but Spooks Wall Street
SpaceX’s public-market debut delivered the kind of growth Elon Musk promised. It also exposed the price of turning a rocket company into an AI-infrastructure giant.

After June’s blockbuster IPO, investors had been waiting for proof that SpaceX could translate its Starlink reach, launch dominance and AI ambitions into earnings. Wednesday’s first quarterly report cleared the revenue bar: sales rose 92% year on year to $7.81 billion, led by $4.29 billion from connectivity, $2.56 billion from AI and $962 million from space. Yet shares, which had risen during the session, fell sharply after hours as the market focused on a $541 million net loss and the cash demands ahead.

The central tension was clearest in AI. SpaceX’s AI revenue more than tripled to roughly $2.6 billion after compute deals with Anthropic and Google, but that division still lost $1.5 billion in the quarter. Capital spending reached $18.37 billion as the company pursued data centers on Earth and, eventually, in orbit. Critics saw lavish spending and science-fiction-scale plans; Musk framed them as the foundation for a much larger business.

On the earnings call, Musk said SpaceX would build its compute infrastructure exclusively with Nvidia, calling Vera Rubin “the best architecture.” He reinforced that message on X: “SpaceX has committed to using Nvidia GPUs exclusively because they are the best.” The choice tightens a key partnership but leaves the company dependent on a single chip supplier, a strategy that runs against the diversification favored by many large technology groups.

Musk’s confidence did not soften the market’s verdict. He projected a $1 trillion revenue year by 2030 — possibly 2029 — while pitching Starlink as a future provider of most of the world’s internet and promising up to 10 gigawatts of computing power by 2027. For investors, the earnings showed a fast-growing company. The selloff showed they are still unconvinced that its AI buildout will pay for itself.

Continue reading https://foxvector.com/stories/019fd199-0ce0-13f2-708c-3aa474e749a8