SpaceX’s AI Boom Delivers Profit, but Its Spending Spree Raises the Stakes
SpaceX’s AI Boom Delivers Profit, but Its Spending Spree Raises the Stakes
SpaceX entered the third quarter still trying to reverse a steep slide. After its June public debut, the company reported a $541 million loss in the prior quarter and said it had accumulated $13 billion in losses since the start of 2023.
Tuesday’s results marked a sharp turn. Revenue jumped 161% year over year to $14.6 billion, while net income reached $4.4 billion and operating income rebounded to $2.79 billion from a second-quarter loss. The key engine was the newly branded “Super Intelligence” division: revenue nearly tripled quarter over quarter to $7.56 billion, exceeding both forecasts and Starlink-led connectivity revenue of $5.25 billion.
That performance has strengthened Musk’s case that SpaceX is no longer merely a rocket-and-satellite company. In a post after the report, he argued that “$1T in SpaceX revenue in 2028 is no longer impossible.” On the earnings call, he set a similarly audacious target, saying annual recurring revenue by the end of 2027 could land “somewhere between $500 billion and a trillion.”
The company’s own figures, however, underline the cost of that ambition. Capital spending reached $19.6 billion in the quarter as it builds Colossus II, expands compute capacity and presses ahead with Starship. CFO Bret Johnsen said new capital investment could run to $35 billion to $40 billion in the fourth quarter.
Musk frames the spending as a competitive edge rather than a financial drag. “The constraint on deployment of super intelligence is more in power and cooling and infrastructure than it is in chips,” he said, claiming SpaceX’s industrial capabilities can deploy that capacity faster than rivals. For now, the profit validates the pitch. Whether AI revenue can sustain the outlay is the next, much larger test.
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