SpaceX Swings to $4.4 Billion Profit as AI Revenue Surges
SpaceX reported $14.6 billion in third-quarter revenue and $4.4 billion in net income, reversing a loss in the previous quarter. Its renamed “Super…
SpaceX reported $4.4 billion in net income for the third quarter, a sharp reversal from its $541 million loss in the second quarter. The company said Tuesday that revenue climbed 161% year over year to $14.6 billion, led by rapid growth in its artificial intelligence business.
The results put SpaceX above analysts’ revenue and operating-income expectations, but its consumer subscriber additions at Starlink came in below forecasts. The earnings offer investors a look at how the company’s expanding AI and connectivity businesses are performing as it spends heavily on capital projects.
AI business leads revenue growth
SpaceX’s renamed “Super Intelligence” segment generated $7.56 billion in revenue, up from $2.56 billion in the second quarter and above analysts’ $6.47 billion estimate, according to Fortune. The segment includes computing capacity leased to Anthropic, Google, Grok and X.
Operating income reached $2.79 billion, rebounding from a loss of $143 million in the prior quarter. Analysts had expected $2.33 billion, based on Visible Alpha consensus from S&P Global Market Intelligence.
The improvement matters because the company’s latest report shows AI contributing a substantial share of its quarterly revenue. Fortune reported that the segment’s revenue nearly tripled in the quarter. The source did not provide a breakdown of how much each customer contributed.
Connectivity revenue, mostly from Starlink, rose 69% to $5.25 billion, topping analysts’ $4.92 billion estimate. Connectivity operating income nearly doubled to $2.37 billion.
Subscriber growth was less robust. Starlink added 1.6 million consumer subscribers, below the 2.29 million analysts had predicted. For users and investors watching the satellite service, that gap separates strong revenue growth from a weaker-than-expected pace of new consumer sign-ups.
Spending remains a major factor
SpaceX spent $19.6 billion on capital projects during the quarter. The company’s release did not include a full-year forecast, Fortune reported, leaving analysts without a company projection for the year.
Fortune cited figures from Melissa Otto, global head of Visible Alpha research at S&P Global, that put SpaceX’s capital investment at about $70 billion this year and projected it could reach $197.4 billion in the 2028 fiscal year. The figures are projections, not company guidance.
Otto’s note also pointed to expected changes in connectivity investment and debt. Consensus projections cited in the note put connectivity capital spending at $4.2 billion in fiscal 2025 and $22.8 billion in fiscal 2028. SpaceX’s debt was expected to rise from $50.7 billion in 2025 to $350 billion in 2029, according to Otto.
The scale of spending sits alongside the quarter’s return to profit. SpaceX reported net income after a second-quarter loss of $541 million and a $5.5 billion loss a year earlier. Those comparisons show a major swing in reported results, though the figures alone do not explain what drove each change.
Starlink expansion and a pending deal
Earlier this month, SpaceX agreed to buy 800-megahertz-band licenses from investment firm Grain Management to improve Starlink Mobile phone service indoors. The deal requires approval from the Federal Communications Commission. Financial terms were not disclosed in the announcement, Fortune reported, while The Wall Street Journal put the amount SpaceX would pay at $8 billion.
That proposed purchase comes as connectivity revenue grows, but subscriber additions fall short of analyst expectations. The license deal’s effect will depend on regulatory approval; the sources do not give a timeline for that decision or say when any improved indoor service would launch.
A day before the earnings results, Elon Musk posted on X that he planned to offer a share of SpaceX stock to “every kid in America” next year, Fortune reported. Musk described the donation as the first of many.
Fortune said Census figures put the number of children under 18 in the United States at roughly 72 million and valued the proposed gift at about $10.5 billion. It also reported that Musk’s SpaceX shares are locked up until 2027 under an agreement he signed before the company’s IPO in June.
SpaceX’s capital spending reached $19.6 billion in the third quarter.
Source: fortune.com
