SpaceX Q3 Revenue Surges 161% as AI Division Overtakes Starlink; Musk Confirms Talks on Potential Tesla Merger

SpaceX reported third-quarter results on October 20, 2026, showing total revenue surged 161% year-over-year to $14.58 billion. Notably, the artificial intelligence division—encompassing the Grok chatbot, social media platform X, and cloud computing services—contributed approximately $7.6 billion, accounting for 52% of total revenue. This marks the first time AI has overtaken the Starlink-led connectivity business, which generated about $5.2 billion, as the company's largest revenue source.

During the earnings call, CEO Elon Musk confirmed that both SpaceX and Tesla have formed special committees of independent directors to discuss a possible merger, "at the request of shareholders." Musk stated he cannot participate due to conflicts of interest but voiced support for the deal: "Do I think it would be a good idea? Yes," adding that shareholders would ultimately need to approve it. Following the news and strong results, SpaceX shares jumped 4% to $154 in after-hours trading, bringing its market capitalization to an estimated $2.01 trillion.

The financial data highlights explosive growth in the AI segment: revenue rose from $818 million in Q1 to $2.56 billion in Q2, and finally to $7.6 billion in Q3. Much of this growth stems from leasing computing capacity to external customers. However, this expansion comes with high costs; SpaceX spent $19.6 billion on capital expenditures in Q3, with roughly $16.4 billion dedicated to AI infrastructure. While Starlink remains highly profitable, generating $2.4 billion in operating income, its dominance in revenue composition has shifted.