SpaceX Surges 9% After Record Q3 Profit and Musk Confirms Tesla Merger Talks

SpaceX reported third-quarter revenue of $14.58 billion, a 161% year-over-year jump, and net income of $4.4 billion, its first quarterly profit since going public in June 2026, reversing a $1.1 billion loss from a year earlier and far exceeding the $1.88 billion analysts had expected. The company's Super Intelligence AI segment generated $7.6 billion in the quarter, an approximately 830% increase, and now produces more revenue than SpaceX's combined space launch and Starlink connectivity businesses. Shares rose roughly 9% in premarket trading, extending an 8% after-hours gain, and lifted Nasdaq futures and broader AI-related stocks including Nvidia, AMD and Intel.

The larger news driving markets was Elon Musk's public endorsement of a potential merger between SpaceX and Tesla, which he called a good idea, disclosing that both companies have formed independent special committees to assess a combination. Bloomberg reported the potential tie-up could represent a roughly $3.5 trillion combination, which would be the largest corporate merger in history. Tesla shares also rose on the news, while Wall Street noted the deal is far from certain, with Musk himself cautioning it is not guaranteed.

JPMorgan doubled its SpaceX price target from $240 to $500, maintaining an Overweight rating, and now forecasts $254 billion in 2027 revenue alongside 10 gigawatts of computing capacity by year-end. Morgan Stanley reiterated Overweight with a $300 target, Wells Fargo raised its target to $274 from $214, Citi raised to $240 from $200 and added SpaceX to its 90-day upside catalyst watch list, while KeyBanc kept its cautious Sector Weight rating citing capital expenditure pressure. Stifel maintained Buy but held its $190 target unchanged.

Musk also told investors on the company's second earnings call since its IPO that SpaceX could reach annual recurring revenue exceeding $500 billion by the end of 2027, with a potential ceiling of $1 trillion, driven largely by AI data-center demand that the company says still outruns supply even as it cannot source sufficient Nvidia, Google or Amazon chips. Starlink is now contracted for service on 12,000 aircraft. SpaceX retained all of its bitcoin holdings through the quarter, a position now worth approximately $1.57 billion, and a combined SpaceX-Tesla entity would hold more than 30,000 bitcoin. Separately, roughly 1.3 billion SpaceX shares become eligible for sale on October 22, a lockup expiry that DeFi risk analysts flagged as a liquidity concern for a proposal to use tokenized SpaceX shares as collateral on Aave.