US billionaire Elon Musk said on Oct. 20 that a merger between his two companies, SpaceX and Tesla, would be "a good idea," and confirmed for the first time that the two sides have set up a special committee to discuss the merger. After the news was announced, SpaceX shares rose 4.9% in after-hours trading.
SpaceX reported quarterly results for the period ended Sept. 30: revenue surged 161% year on year to US$14.58 billion, marking its first profit since going public, with net profit of US$4.4 billion, far exceeding analysts' expectations of US$1.57 billion. Revenue from its artificial intelligence business soared nearly tenfold to US$7.56 billion, mainly from leasing data center computing power to Anthropic, Google and others, and has become the company's largest business line. Starlink users reached 13.6 million, beating market expectations.
On an investor call, Musk said annual recurring revenue would reach US$500 billion to US$1 trillion by the end of 2027. However, the company's capital expenditure nearly tripled to US$19.6 billion, of which US$16.4 billion was invested in AI infrastructure, while operating losses in its AI division remain huge.
Musk said he would not participate in the special committee's discussions because of a conflict of interest, and that the transaction would ultimately require shareholder approval. Barclays said last week that the two sides could announce an agreement before Tesla's December shareholder meeting.
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