Key Takeaways
- SpaceX’s Super Intelligence segment brought in $7.56 billion of third-quarter revenue, more than the $5.25 billion from Connectivity, which is mostly Starlink.
- Starlink’s consumer subscribers rose 89% in a year to 13.6 million, but revenue per user fell to $69 a month from $83.
- Starlink still earned 85% of SpaceX’s operating profit. The bigger risk is $48.1 billion of capex in nine months against $13.1 billion of operating cash flow.
- Analysts expect $335 billion of revenue in 2028, well short of the $500 billion to $1 trillion run rate Elon Musk sees by the end of 2027.
SpaceX (SPCX) closed at $123.62 on Nov. 5, below its $135 IPO price, as the post-midterm selloff hit Musk’s companies. The business behind the stock has changed since the June listing: renting out AI compute now brings in more revenue than Starlink.
Compute Pulled Ahead of Starlink
SpaceX’s $14.6 billion of third-quarter revenue split three ways:
- Super Intelligence (data-center compute, Grok and Cursor): $7.56 billion
- Connectivity (mostly Starlink): $5.25 billion
- Space (launch and Starship): $1.77 billion
SI revenue nearly tripled from $2.56 billion in the second quarter as cloud contracts with Anthropic and other AI customers kicked in. It made up 52% of revenue and 56% of adjusted EBITDA.
Jim Cramer put it bluntly on the Nov. 6 Mad Money: “SpaceX’s main business at this point is renting out computing power. That’s what it makes its money on.”
He’s right about the first part. The second is where I’d push back.
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Starlink Is Growing on Cheaper Customers
Consumer subscribers rose 89% in a year, but consumer revenue rose only 57%, to $3.12 billion. Revenue per user fell 17%, though it rose from $66 in the second quarter as more new customers came from developed markets. One r/stocks investor called that the catch: “A great product isn’t guaranteed an unlimited customer base at American pricing.”
The cheaper customers haven’t hurt profits, though. Connectivity earned $2.37 billion from operations, 85% of SpaceX’s $2.79 billion total, at a 45.1% margin, up from 38.4% a year earlier. SI earned $431 million after $1.22 billion of stock pay tied to Cursor. On operating profit, Starlink still pays the bills.
Wall Street Isn’t Buying Musk’s Math
On the third-quarter call, Musk said SpaceX’s annual recurring revenue by the end of 2027 would be “somewhere between $500 billion and a trillion.” Analysts have revenue at $180 billion in 2027 and $335 billion in 2028:
Even 2028, the first full year after Musk’s target date, falls well short of his low end. SpaceX’s own guidance is more modest: $33 billion to $37 billion of revenue in the first quarter of 2027. The ramp is real, though. Quarterly revenue nearly doubled from the second quarter to the third:
At 44x forward earnings on Nov. 6, investors are paying for compute to keep compounding.
Now for the Bill
SpaceX spent $48.1 billion on capex in the first nine months of 2026, $40.0 billion of it in SI, against $13.1 billion of operating cash flow. It guides to $35 billion to $40 billion more in the fourth quarter. Its CFO said new compute pays for itself in less than a year at current prices. If rental prices fall, SpaceX will lean far harder on debt and new stock.
Compute, Not Starlink, Decides SpaceX Stock
Starlink’s falling revenue per user is the least of SpaceX’s worries. It’s adding customers fast at rising margins. The stock will rise or fall on whether compute earns back what it costs, and fourth-quarter results early next year are the first real test. December revenue needs to reach about $8.3 billion for management’s $100 billion run-rate goal, and fourth-quarter cash flows will show how SpaceX funded the build and whether it drew down its $89.9 billion of cash, cash equivalents and marketable securities held at Sept. 30.
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!
