Elon Musk has indicated he would support a merger between SpaceX and Tesla, just as his rocket and artificial intelligence company reported its first quarterly profit since its stock market debut. The turnaround was driven by a surge in demand for computing power rented out to AI firms.
Speaking on a conference call with analysts on Tuesday, Musk described the prospect of combining the two companies as “tap dancing through a minefield,” but added that a tie-up would be “a good idea.” His comments sent SpaceX shares up nearly 5% in after-hours trading.
Musk said that at the request of shareholders, special committees of independent directors at both SpaceX and Tesla had been formed to study the proposal. He noted that he would not take part in their deliberations because of a conflict of interest, given his roles as chief executive of both companies and chairman and chief technology officer of SpaceX.
According to a regulatory filing, Musk owned 48.4% of SpaceX as of 30 June and controls more than 82% of its voting power through shares with enhanced voting rights. He holds about 20% of Tesla.
Musk cautioned that the committees had not agreed on terms and that there was no guarantee a deal would materialise. Any merger would require the approval of a majority of all Tesla shares, not just those voted, which he called “quite a high hurdle.” He suggested the two companies could collaborate on AI software, chip design, robotics, and space-based computing.
AI drives SpaceX's first profit
The comments came after SpaceX reported net income of $4.4 billion (€3.8bn) for the July–September period, compared with a loss of $1.1 billion (€0.95bn) a year earlier. Revenue jumped 161% to $14.6 billion (€12.6bn).
SpaceX began trading on the Nasdaq on 12 June after an initial public offering priced at $135 per share, raising about $85.7 billion (€73.9bn). Its first earnings report as a listed company showed second-quarter revenue of $7.8 billion (€6.7bn) and a net loss of $541 million (€466m).
The AI division, now called “Super Intelligence” — a term favoured by US President Donald Trump — was the main driver of the turnaround. Revenue from the unit rose more than ninefold year-on-year to $7.6 billion (€6.6bn), overtaking the Starlink satellite internet business as SpaceX's largest source of sales.
SpaceX credited new cloud services agreements, wider adoption of its Grok chatbot, and its acquisition of Cursor, an AI coding start-up. Among its cloud customers is Anthropic, which agreed in May to pay nearly $45 billion (€38.8bn) over three years for computing power at SpaceX's Colossus data centres. Google signed on in June, committing to pay $920 million (€793m) a month from October through June 2029.
The AI unit reported an operating profit of $431 million (€371m), compared with a loss of $1.7 billion (€1.5bn) a year earlier. However, spending remains heavy: SpaceX invested $19.6 billion (€16.9bn) in the quarter, of which $16.4 billion (€14.1bn) went into AI, bringing capital spending for the first nine months of the year to $48 billion (€41.4bn).
Computing capacity reached 1.7 gigawatts, up from 0.6 gigawatts a year earlier. Musk said he was “fairly confident” that SpaceX could bring an additional 10 gigawatts of computing capacity online in 2027, on top of the roughly 2.5 to 3.0 gigawatts expected by the end of this year. He added that power, cooling, and electrical equipment were “somewhat of a limiting factor.”
Starlink revenue grew 69% to $5.2 billion (€4.5bn), with consumer subscribers reaching 13.6 million. Average monthly revenue per consumer, however, fell to $69 (€59) from $83 (€72) a year earlier. SpaceX also completed the first revenue-generating flight of Starship, the giant rocket central to Musk's Mars ambitions and to deploying satellites at scale, carrying 26 next-generation Starlink satellites into orbit.
While the merger talk is speculative, it highlights Musk's growing influence across the tech and space sectors. For European observers, the development underscores the accelerating competition in AI infrastructure, where US firms dominate but European players are seeking to carve out their own role. The potential tie-up also raises questions about regulatory scrutiny, particularly in Brussels, where competition authorities have shown increasing interest in big tech deals.
