SpaceX Earnings Preview: Can AI Revenue and Starlink Growth Deliver Its First Post-IPO Profit?

Key Takeaways

• SpaceX will report third-quarter results after the US market closes on October 20, followed by an earnings call at 4:30 p.m. Eastern Time.
• Wall Street expects revenue of approximately $12.8 billion, up around 64% year over year, and adjusted earnings of $0.13 to $0.16 per share.
• AI revenue could approach $6 billion and overtake Starlink as SpaceX’s largest quarterly business for the first time.
• Starlink remains the company’s most established profit generator, with analysts expecting connectivity revenue of approximately $4.5 billion to $4.8 billion.
• Capital expenditure, cash burn and customer concentration will determine whether investors view the AI expansion as sustainable.

SpaceX will report its third-quarter earnings on Tuesday with investors looking for the company’s first profitable quarter since its June stock market debut.

The central question is no longer whether SpaceX can generate rapid revenue growth. Wall Street is instead assessing whether its expanding AI infrastructure business and profitable Starlink operation can generate enough cash to support one of the technology sector’s most aggressive capital-spending programs.

The report arrives at a sensitive moment for AI stocks. Concerns about data-center debt, elevated Treasury yields and uncertain returns from infrastructure investment pushed semiconductor shares sharply lower last week. SpaceX must therefore demonstrate that its spending is already producing measurable revenue and improving profitability.

When Will SpaceX Report Q3 2026 Earnings?

SpaceX will publish its financial and operating results after the closing bell on Tuesday, October 20. Management will host an audio-only webcast at 4:30 p.m. Eastern Time, or 4:30 a.m. on October 21 in Beijing and Singapore.

The company confirmed that the presentation, webcast replay and submitted investor questions will be available through its investor-relations website.

This will be SpaceX’s second quarterly earnings report since its initial public offering in June.

SpaceX Q3 Earnings Forecast

Wall Street forecasts point to a sharp acceleration from the second quarter, largely driven by new AI cloud-service contracts.

FactSet’s consensus calls for approximately $12.8 billion in revenue, representing annual growth of about 64%, and earnings of roughly $0.13 per share. Other estimates place EPS closer to $0.14 to $0.16.

A profit would mark a major improvement from the second quarter, when SpaceX reported a $541 million net loss and adjusted EBITDA of $3.54 billion. Revenue increased 92% year over year to $7.81 billion during that period.

AI Revenue Could Overtake Starlink

Artificial intelligence is expected to deliver most of SpaceX’s sequential growth.

Deutsche Bank analyst Edison Yu estimates that AI revenue nearly tripled from the second quarter to approximately $6 billion. Some forecasts place the figure as high as $6.47 billion, compared with only $2.56 billion in Q2.

At the upper end of that range, AI would become SpaceX’s largest business by quarterly revenue, surpassing connectivity for the first time.

SpaceX’s AI segment includes its Grok products, advertising associated with X and the sale of data-center computing capacity to external customers. The infrastructure business has recently become the most important growth driver.

In the second quarter, AI solutions and infrastructure generated $2.19 billion, up from $475 million in the first quarter. Total AI revenue increased 247% from the previous year and 213% sequentially.

The division still recorded a $1.26 billion operating loss, but adjusted EBITDA turned positive at $1.15 billion. SpaceX attributed the improvement to new cloud-service agreements that allowed it to monetize previously available computing capacity.

Investors will want to know whether that adjusted profitability continued in Q3 and whether higher depreciation, research spending and interest costs prevented the segment from reaching an operating profit.

Google and Anthropic Contracts Drive the AI Expansion

SpaceX disclosed $14.1 billion of contracted cloud-service sales in the second quarter. Those agreements contributed approximately $1.6 billion of incremental infrastructure revenue during the period.

Management subsequently said it had contracted an additional $6.7 billion of cloud-service revenue during the opening weeks of Q3, with the new business expected to begin ramping in October.

Customers include Google and Anthropic, which are renting access to SpaceX’s computing infrastructure to train and operate AI models. Reports indicate that Google agreed to pay approximately $920 million per month for capacity beginning in October.

These contracts give SpaceX a relatively clear route to near-term growth. However, they also create several risks.

A large share of projected AI revenue appears to come from a limited number of customers. Any delay in deploying computing capacity, renegotiation of contract terms or slowdown in AI investment could have a disproportionate effect on revenue.

Investors will therefore look beyond the headline AI figure and focus on:

• The number of external cloud customers
• Remaining contracted sales and backlog
• AI operating and adjusted EBITDA margins
• Data-center utilization rates
• The proportion of computing capacity used internally
• The durability and cancellation terms of cloud contracts

SpaceX previously said it expects only around 10% of its computing capacity to be used for training Grok over time, with most capacity allocated to inference or rented to external customers.

Can SpaceX Reach Its $100 Billion Revenue Run Rate?

Management’s year-end target will be one of the most important subjects on the earnings call.

During the previous call, SpaceX said it expected to reach an annualized revenue run rate of at least $100 billion in December. That projection was based on expected December sales rather than total revenue generated during 2026.

Cloud services were expected to provide the largest contribution, supported by Starlink growth and the planned integration of AI coding company Cursor. Elon Musk said the $100 billion run-rate target was achievable without additional contracts and could ultimately be exceeded.

The third-quarter results should indicate whether SpaceX remains on schedule.

Quarterly revenue near $12.8 billion would represent an annualized rate of about $51 billion, well below the year-end target. Reaching $100 billion would therefore require monthly revenue to accelerate substantially during the fourth quarter as recently signed AI agreements begin contributing.

Any reduction or delay in the target could place pressure on SpaceX stock, given the company’s high valuation and the rapid growth already embedded in analyst forecasts.

Starlink Remains SpaceX’s Profit Engine

Although AI may become SpaceX’s largest revenue source, Starlink remains the company’s most reliable generator of operating profit.

Connectivity revenue reached $4.29 billion in the second quarter, an increase of 66% year over year. Operating income rose 79% to $1.66 billion, while adjusted EBITDA increased to $2.60 billion.

Starlink ended June with 12 million subscribers, double the number reported a year earlier. The company added 1.7 million subscribers during the quarter while average revenue per user remained stable at $66 per month.

Analysts expect third-quarter connectivity revenue of approximately $4.5 billion to $4.8 billion. Subscriber additions could reach another 1.5 million to 1.8 million, supported by residential broadband, aviation, maritime and government customers.

Starlink’s enterprise and government operations deserve particular attention. Revenue from those customers increased 108% year over year in Q2, while SpaceX secured more than $6 billion in multiyear US government contracts for Starshield.

Aviation also remains underpenetrated. Management said Starlink had reached only about 10% of the commercial aviation market, leaving significant room for expansion.

Starlink Mobile Could Open a Larger Market

SpaceX is also positioning Starlink as a potential competitor to conventional mobile networks.

The company obtained access to 65 megahertz of EchoStar spectrum, compared with around 5 megahertz currently used through partnerships with local telecommunications companies. SpaceX plans to begin launching its next-generation mobile satellites in 2027 and aims to introduce service before the end of that year.

Management argues that combining additional spectrum with a much larger satellite constellation could make the next system approximately 100 times more capable than its current mobile service.

Investors will listen for updates on the EchoStar transaction, satellite deployment schedules and whether SpaceX intends to offer mobile service directly to consumers or continue working through existing carriers.

The opportunity is potentially significant, but building a full mobile network could require substantial terrestrial infrastructure and additional capital.

Capital Spending Is the Largest Financial Risk

SpaceX’s growth comes with an extraordinary investment requirement.

Second-quarter capital expenditure reached $18.37 billion, compared with $2.83 billion in the same quarter of 2025. Approximately $15.83 billion was allocated to AI infrastructure, while the remainder supported Starship, satellite production and ground stations.

Some analyst estimates place third-quarter capital expenditure near $19.6 billion, which could produce negative free cash flow of more than $11 billion despite the expected return to quarterly profitability.

This distinction matters. Positive EPS would demonstrate improving accounting profitability, but it would not mean SpaceX is generating cash after infrastructure investment.

The company entered the second half with substantial financial resources. It held approximately $100 billion of cash, cash equivalents and marketable securities after raising $85.7 billion through its IPO and issuing $25 billion of senior notes.

However, continued AI expansion, Starship development and a future Starlink Mobile network could consume that cash quickly. Investors will want management to address:

• Full-year 2026 capital expenditure
• Expected 2027 AI spending
• Free-cash-flow timing
• Future debt or equity financing
• Returns from recent data-center investments
• Whether capital spending is constrained by chip or power availability

Management previously said new compute investments were producing payback periods of less than one year. Q3 margins and cash flow should provide the first major test of that claim.

Starship and Launch Operations Remain Strategically Important

SpaceX’s traditional launch operation is now its smallest business by revenue, but it remains essential to both Starlink and the company’s long-term cost structure.

Space revenue reached $962 million in the second quarter, up 29% year over year, but the segment recorded an operating loss of $542 million as development spending increased.

SpaceX completed 38 launches during the quarter and continued investing in Starship. Management believes full and rapid reusability could reduce launch costs dramatically and make larger Starlink and orbital computing deployments economically viable.

Investors will look for updates on Starship missions 15 and 16, the heat shield, in-orbit propellant transfer and the schedule for launching next-generation Starlink satellites.

Delays could increase development costs and restrict SpaceX’s ability to deploy the satellites needed for broadband, mobile connectivity and potential space-based computing.

How Much Could SpaceX Stock Move?

Options prices imply that SpaceX shares could move approximately 7.5% in either direction following the report.

With the stock recently trading near $150, that would suggest a post-earnings range of approximately $139 to $162. Shares are around 11% above the IPO price but remain well below their post-listing peak above $225.

Potential earnings scenarios include:

What Investors Should Watch on the Earnings Call

The headline revenue and EPS figures will be important, but management’s outlook could have a greater influence on SpaceX stock.

The most important questions are:

1. Did AI revenue exceed Starlink revenue during the quarter?
2. Has the AI division reached operating profitability?
3. Is SpaceX still confident in exceeding a $100 billion annualized revenue run rate in December?
4. How many Starlink subscribers were added?
5. Can connectivity margins continue expanding?
6. How high will capital expenditure rise in 2027?
7. When does SpaceX expect to generate positive free cash flow?
8. Are Starship missions and next-generation satellite launches on schedule?

Speculation about a possible transaction involving Tesla may also surface because Tesla reports earnings one day later. Unless management provides concrete information, however, the financial performance of AI, Starlink and capital spending will remain more relevant to the investment case.

Can SpaceX Deliver Its First Post-IPO Profit?

SpaceX appears positioned to report its first positive quarterly EPS as a public company, supported by accelerating cloud-service revenue and continued Starlink growth.

AI could become the company’s largest business sooner than investors expected, while Starlink provides the operating profit needed to fund expansion. Together, the two divisions could lift quarterly revenue close to $13 billion.

The challenge is converting that growth into sustainable cash generation. Capital expenditure is increasing almost as quickly as revenue, and a significant portion of the AI expansion depends on a small group of large customers.

A revenue beat, positive EPS and reaffirmation of the $100 billion run-rate target would strengthen the case that SpaceX can grow into its valuation. But another quarter of heavy cash burn without clearer 2027 spending limits could leave investors questioning whether the first post-IPO profit marks a durable turning point or merely a milestone inside a much larger investment cycle.

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