Key Takeaways
- SpaceX shares jumped 9% the day after its third-quarter report and gave back the whole gain the next day, even though revenue came in about 14% above estimates.
- SpaceX’s price depends on Musk’s revenue targets, which is why even a big beat barely moves the stock.
- Jim Chanos says SpaceX’s annualized AI revenue per megawatt was below $20 million in the third quarter, well under what bullish projections assume.
- Fourth-quarter results in early 2027 will show whether SpaceX reached its $100 billion annualized revenue goal in December.
SpaceX (SPCX) just reported the kind of quarter most companies would be happy to have as a full year. Revenue rose 161% to $14.6 billion, about 14% more than analysts expected.
The stock jumped 9% on Wednesday, Oct. 21, the day after the report. By the end of Thursday, the gain was gone.
George Noble ran Fidelity’s Overseas Fund in the 1980s and then started the hedge fund Teton Partners. He thinks he knows why. On Thursday’s episode of Bloomberg Surveillance, he said:
“I think SpaceX is the most egregiously overpriced company at scale in the history of capital markets.”
That’s a high bar, given the history of capital markets.
The beat barely matters at this size
Noble’s point is that one quarter hardly registers next to SpaceX’s valuation: “does it really matter whether the revenues are $40 billion or $60 billion or whatever they are? It’s insane.”
He said SpaceX trades at something like 100x revenue. He also brought up former Sun Microsystems CEO Scott McNealy’s famous warning about paying even 10x revenue for a stock.
Noble’s number runs a little hot. At roughly $2 trillion, SpaceX is worth a bit over 60x the $32.0 billion of revenue it brought in over the last twelve months. That’s still six times McNealy’s line.
Part of Thursday’s drop came from a broad tech sell-off, on worries that the AI trade had gotten ahead of itself. About 911.5 million insider shares also became eligible for sale that day. Still, by midday Friday the stock was up just 1% for the week.
TIKR tracks 38 analysts on SpaceX. How many say “Buy”?
See the full breakdown of Buy, Hold, and Sell ratings on SpaceX, along with Wall Street’s revenue and earnings estimates, all in one place. More than 500,000 investors use TIKR to research stocks like this one. See SpaceX’s Analyst Ratings
Musk’s targets are doing the work
On SpaceX’s third-quarter call, Musk said the company could reach an annualized revenue run rate of $500 billion to $1 trillion by the end of 2027. Analysts are nowhere near that.
Consensus calls for $48.8 billion of revenue in 2026, $180 billion in 2027 and $336 billion in 2028. So the 2028 estimate is well below the low end of the run rate Musk wants a year earlier.
And those estimates already assume a steep climb. SpaceX guided first-quarter 2027 revenue to $33 billion to $37 billion. If revenue stayed at the top of that range all year, 2027 would still come in about $30 billion short of the consensus.
Getting there won’t be cheap, either. Analysts expect SpaceX’s free cash flow to be negative $57.7 billion in 2026 and negative $140.7 billion in 2027.
Meanwhile, the stock trades at about 52x forward earnings. Consensus has earnings per share going from a loss of $0.30 in 2026 to $2.50 in 2027.
The estimates keep catching up
Plus: analysts have spent the last four months catching up. Since the end of June, they’ve raised their 2027 revenue estimates 146% and their 2028 estimates 200%. That has helped pull the forward P/E down to about 52x, from roughly 97x at the end of September.
But the reported numbers still trail the bull math.
On X, an investor posting as @BeenThereCap projected at least $300 billion of SpaceX revenue by the end of 2027. The post started from Atreides Management’s Gavin Baker’s estimate of $100 billion of AI revenue per gigawatt of compute a year, then guessed that SpaceX captures 30% of it.
Veteran short seller Jim Chanos, best known for calling Enron’s collapse, replied:
“Except that $SPCX had annualized AI revenues per average MW of below $20M in the 3Q, despite its lucrative deals with Google and Anthropic. The actual reported GAAP numbers never seem to match the narrative.”
By that post’s math, SpaceX would earn about $30 million a year per megawatt. Chanos’s figure is at least a third lower.
Noble has a point
It’s hard to prove that SpaceX is the most overpriced company in history. But the stock clearly trades on Musk’s targets, and a quarter that beat by 14% couldn’t hold a 9% gain past the next day.
My take: at 52x forward earnings, with reported AI revenue running behind the projections, I side with the skeptics.
Of course, SpaceX’s AI segment only turned an operating profit in the third quarter, so it’s early days for its revenue per megawatt. Fourth-quarter results in early 2027 will show whether December revenue reached SpaceX’s $100 billion annualized goal. That takes about $8.3 billion in the month.
So what is SpaceX stock actually worth?
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Disclaimer:
Please note that the articles on TIKR are not intended to serve as investment or financial advice from TIKR or our content team, nor are they recommendations to buy or sell any stocks. We create our content based on TIKR Terminal’s investment data and analysts’ estimates. Our analysis might not include recent company news or important updates. TIKR has no position in any of the stocks mentioned. Thank you for reading, and happy investing!
