SpaceX stock falls on surprise capex surge despite doubling revenue

SpaceX filed its first earnings report as a publicly listed company on Tuesday following its June IPO at a $2 trillion valuation, a milestone from which the stock has since shed close to $500 billion in market value. The company posted Q2 revenue of $7.8 billion, nearly double year-over-year and exceeding analyst expectations of $6.9 billion, while adjusted EBITDA tripled and net losses narrowed to nearly half the level of a year ago. Despite these operational bright spots, shares slid more than 5% immediately after the results and continued to fall 6–8% in after-hours trading.

The primary culprit, according to S&P Global's Visible Alpha research head Melissa Otto, was capex: SpaceX reported $18.4 billion in capital spending for Q2, nearly $16 billion of it directed to AI compute infrastructure, compared to analyst expectations of $13.2 billion and Q1's $10.1 billion. This surge—driven in part by SpaceX's exclusive commitment to Nvidia chips and its $6.7 billion in cloud-services orders for the second half of the year—dwarfed the capex concerns that have punished Alphabet and Tesla this earnings season, though it failed to impress investors the way Microsoft and Amazon's backlog strength did.

During the earnings call, CEO Elon Musk sought to refocus the market on longer-term opportunity. He announced that SpaceX's internal $1 trillion annual revenue target had been advanced one year to 2030 (from the IPO guidance of 2031), with "a non-zero chance" of hitting it in 2029—a projection that Musk tied to three core business pillars. Starlink, the satellite-based connectivity business, posted Q2 revenue of $4.3 billion (up 66% year-over-year) with a doubled subscriber base of 12 million and 1.7 million new customers added in the quarter; major airlines including American, Southwest, Virgin Atlantic, Iberia, and Aer Lingus signed Starlink agreements during Q2. Musk said Starlink could eventually deliver "a majority of the world's internet, at least in countries where we're allowed to operate" within "less than 10 years." The AI business grew 247% to $2.6 billion, fueled by cloud-hosting agreements with Google and Anthropic, Grok subscriptions, and X advertising; SpaceX ended Q2 with 1.4 gigawatts of compute capacity (versus 400 megawatts a year ago) and is on track to hit $100 billion in annualized revenue run rate by December. The rocket business posted $962 million in revenue, and Musk said SpaceX could launch Starship—its next-generation heavy-lift rocket—at least once daily within "probably a year from now."

Musk's most speculative remarks focused on moonshot ambitions. He reframed SpaceX's satellites as "robots" given their autonomous operation, and sketched a vision of moon-based robots enabling manufacturing scaled to the lunar surface, including mass accelerators powered by solar production, and ultimately factories that could propel the company to "1,000x the economy of Earth." Even Musk acknowledged the scenario sounded "totally nuts," but he asserted "it's going to happen." To underpin this vision, Musk emphasized that Starship's launch capacity is expected to grow from current levels to "more than a million" and potentially "10 million tons per year," describing the difference as "ridiculously profound." Critically, the path from $7.8 billion in quarterly revenue to $1 trillion annualized requires this Starship development to remain on track, Starlink bandwidth expansion to sustain growth, and the AI business to convert its heavy capex investment into revenue before investor patience expires. Otto of Visible Alpha noted the $1 trillion target was "ambitious and remains a show-me story" but acknowledged "if the company remains in acceleration mode, it's possible." Another near-term headwind looms: roughly one billion insider shares become eligible for sale Thursday, which historically exerts downward pressure on newly public companies.