SpaceX posts first operating profit as AI revenue hits $7.6 billion

SpaceX reported third-quarter revenue of $14.6 billion on Tuesday, up 161% year over year and far above the $12.86 billion analysts expected, according to Visible Alpha consensus from S&P Global Market Intelligence.

Net income came in at $4.4 million, or 35 cents a share. That compares with a net loss of $541 million in the second quarter and a loss of $5.5 billion a year ago. Operating income rebounded to $2.79 billion from a loss of $143 million in the second quarter, beating the $2.33 billion analysts expected. The result marks SpaceX's first operating profit as a public company.

The driver was the company's AI segment, renamed "Super Intelligence."

What powered the profit?

Super Intelligence, which leases computing capacity to Claude-maker Anthropic, Google, Grok and X, generated $7.56 billion in revenue. Analysts had expected $6.47 billion. The segment's revenue nearly tripled from $2.56 billion in the second quarter, and it now outpaces Starlink as SpaceX's largest business.

Connectivity revenue, mostly from Starlink, rose 69% to $5.25 billion, beating the $4.92 billion analysts expected. Connectivity operating income nearly doubled to $2.37 billion. Starlink added 1.6 million consumer subscribers, falling short of the 2.29 million analysts predicted.

Space revenues rose 6% to $1.77 billion, above the $1.46 billion expected.

What about spending and debt?

Capital spending reached $19.6 billion in the quarter. The release did not include a full-year forecast, leaving analysts without a key input for modeling the outlook.

The spending curve is steep. Melissa Otto, global head of Visible Alpha research at S&P Global, said SpaceX's capital investments are expected to nearly triple from about $70 billion this year to $197.4 billion in the 2028 fiscal year.

In a note before the third-quarter numbers were released, Otto wrote that consensus projections pegged connectivity capex surging from $4.2 billion in fiscal 2025 to $22.8 billion in fiscal 2028. SpaceX's debt is expected to rise nearly sevenfold from $50.7 billion in 2025 to $350 billion in 2029, according to Otto.

What deals sit behind the numbers?

Earlier this month, SpaceX agreed to buy investment firm Grain Management's 800 megahertz-band licenses to strengthen its Starlink Mobile phone service indoors. Grain Management is a global investment firm that specializes in digital infrastructure. The deal is subject to FCC approval. Financial terms were not disclosed, but Wall Street Journal reporting put the amount SpaceX will pay at $8 billion.

What did Musk promise shareholders' children?

The Q3 results landed a day after Elon Musk posted on X that he planned to offer a share of SpaceX stock to "every kid in America" next year, calling the donation the first of many. Census figures show roughly 72 million children under 18 in the U.S., which would value the gift at about $10.5 billion.

Musk's hands are tied for now. All of his SpaceX shares are locked up until 2027 under an extensive agreement he signed before the company's IPO in June.

The quarter shows the mechanism behind the profit: rented compute, not rockets, now carries the company. Whether first-ever operating income survives a capex ramp toward $197.4 billion by 2028 is the question Otto's debt projections put squarely in front of investors.