Elon Musk says he supports a merger of SpaceX and Tesla, as SpaceX reported on Tuesday 20 October 2026 its first profitable quarter as a listed company, with net income of $4.4 billion for July to September. SpaceX shares rose in after-hours trading. Nothing has been agreed: independent special committees of directors at both companies are studying the idea at shareholders’ request, and Musk said he cannot take part in them because of a conflict of interest.
Revenue for the quarter rose 161% to $14.6 billion. A year earlier SpaceX recorded a net loss of $1.1 billion. Operating income was about $2.8 billion, below the $4.4 billion net income figure.
The AI division, called Super Intelligence, was the main driver. Its revenue rose more than ninefold to about $7.6 billion, making it the largest source of sales ahead of Starlink, and it posted an operating profit of $431 million, against an operating loss of $1.7 billion a year earlier. Growth was credited to cloud contracts, wider use of the Grok chatbot and the acquisition of the AI coding startup Cursor. Anthropic agreed in May to pay nearly $45 billion over three years for computing power at SpaceX’s Colossus data centres, and Google agreed in June to pay $920 million a month from October 2026 to June 2029.
The push is expensive. Capital spending was $19.6 billion in the quarter, $16.4 billion of it on AI, and about $48 billion over the first nine months of the year. Computing capacity reached 1.7 gigawatts, up from 0.6 gigawatts a year earlier, with 2.5 to 3.0 gigawatts expected by the end of 2026 and a further 10 gigawatts planned for 2027. Musk named power, cooling and electrical equipment supply as limits on how fast it can grow.
Starlink revenue rose 69% to $5.2 billion, with 13.6 million consumer subscribers, but average monthly revenue per consumer fell to $69 from $83 a year earlier. Starship also completed its first revenue-generating flight, carrying 26 next-generation Starlink satellites into orbit.
On the merger, Musk said it would be a good idea and named AI software, chip design, robotics and space-based computing as areas where the two companies could work together. He also said a deal is not certain. Any deal would need the approval of a majority of all outstanding Tesla shares, not just those voted, a threshold he called a high hurdle. As of 30 June, Musk owned 48.4% of SpaceX and controlled more than 82% of its voting power through super-voting shares, and he holds about 20% of Tesla.
The open questions are whether the two committees can agree terms, how Tesla shareholders would vote under that threshold, and whether SpaceX can keep funding its AI build-out at this pace while per-customer revenue at Starlink is falling.
