Elon Musk said on Tuesday that he would back a merger of SpaceX and Tesla, as his rocket and AI company reported its first quarterly profit since going public, driven by deals to rent out computing power to AI firms.
Asked about a possible tie-up on a call with analysts, Musk said he felt he was “tap dancing through a minefield”, but that a combination would be “a good idea”.
Shares in SpaceX shot up nearly 5% in after-hours trading following the comments.
Musk said special committees of independent directors at both SpaceX and Tesla had been established to study the idea at the request of shareholders.
He added that he could not take part in their talks because he had a conflict of interest.
Musk is chief executive of both companies and also serves as chairman and chief technology officer of SpaceX.
He owned 48.4% of SpaceX as of 30 June, according to a regulatory filing, and controls more than 82% of its voting power through shares carrying enhanced voting rights.
He holds about 20% of Tesla.
The committees have not agreed on the terms of any deal, and there is no guarantee they will, Musk said, cautioning that it would be overstating the position to treat a merger as a certainty.
Any deal would need the backing of a majority of all Tesla shares, not just those voted, which Musk called “quite a high hurdle”.
He said the two companies could benefit from working together on AI software, chip design, robotics and space-based computing.
His remarks came after SpaceX posted 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). The quarterly results follow a bumpy start on Wall Street.
SpaceX began trading on the Nasdaq on 12 June after an IPO priced at $135 a share that raised 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, which SpaceX now calls “Super Intelligence”, drove the turnaround. Super Intelligence is US President Donald Trump’s preferred term for AI.
The unit’s revenue rose more than ninefold from a year earlier to $7.6 billion (€6.6bn), overtaking the Starlink satellite internet business as the company’s largest source of sales.
Cloud computing
SpaceX credited new cloud services agreements, wider adoption of its Grok chatbot and its acquisition of Cursor, an artificial intelligence coding start-up.
SpaceX’s cloud customers include 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, agreeing 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.
As with other AI companies, spending remains heavy.
SpaceX invested $19.6 billion (€16.9bn) in the quarter, of which $16.4 billion (€14.1bn) was invested in AI, bringing capital spending for the first nine months of the year to $48 billion (€41.4bn).
Its 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.
That would come on top of the approximately 2.5 to 3.0 gigawatts it expects to have running by the end of this year.
He added that power, cooling and electrical equipment were “somewhat of a limiting factor”.
Revenue at the Starlink satellite internet unit grew 69% to $5.2 billion (€4.5bn), and consumer subscribers reached 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.
The flight carried 26 next-generation Starlink satellites into orbit.