SpaceX Faces Investor Scrutiny as AI Spending Drives Growth

Investors are assessing SpaceX's expanding artificial intelligence operations, satellite connectivity business and rocket development program as the company prepares to report third-quarter results after the market closes on Tuesday, October 20, 2026. The report marks its second earnings release since a record initial public offering in June and will provide insight into how the company balances revenue growth with substantial investment costs.

According to LSEG consensus estimates, analysts expect SpaceX to report $12.72 billion in revenue and earnings per share of 13 cents. StreetAccount estimates put third-quarter AI revenue at $6.47 billion, connectivity sales at $4.84 billion and space business revenue at $1.41 billion.

SpaceX's connectivity division, which includes its Starlink satellite internet service, has generated most of the company's revenue and profit in recent quarters, according to the source report. The company is also expanding its ambitions in mobile communications following its announcement earlier in October that it would acquire 800 MHz of low-band spectrum.

The Federal Communications Commission has approved a plan for SpaceX to build a constellation of 15,000 satellites. RBC Capital Markets analysts said the developments could strengthen Starlink Mobile's competitive position against established telecommunications carriers.

In a note ahead of the earnings report, RBC Capital Markets analysts wrote, "Starlink Mobile's ability to compete with major carriers by enabling broader, deeper coverage." The firm has a $225 price target on SpaceX shares and an equivalent of a buy rating.

SpaceX's artificial intelligence expansion remains another central focus for investors. The company and xAI merged in February, and the combined business has invested heavily in competing with established AI developers, including OpenAI, Anthropic and Google.

During its first earnings report in August, SpaceX disclosed capital expenditures of $18.4 billion, with 80% allocated to its artificial intelligence division. The spending prompted concern among investors, and shares fell following the report.

SpaceX also completed its $60 billion acquisition of AI coding startup Cursor during the third quarter. The division has been referred to as SpaceXAI or SpaceXSI, with the latter name using the initials for "Super Intelligence," a term associated in the source report with President Donald Trump's preference.

Financing costs present an additional challenge as the company expands its computing infrastructure. SpaceX's debt and finance leases rose to $36.8 billion in the second quarter from $22 billion in the previous period, according to the report.

Conditions have also deteriorated for companies specializing in AI cloud infrastructure, commonly known as neoclouds. CoreWeave and Nebius shares fell 28% in October, while IREN declined about 35%, amid concerns that higher interest rates could make infrastructure expansion more expensive.

Australian AI data center operator Firmus withdrew its planned initial public offering earlier in October, citing market volatility and conditions. Although SpaceX relies less heavily on cloud computing than some competitors, its investment strategy remains exposed to the cost of building AI infrastructure and continued demand for AI services.

SpaceX's launch business continues to serve the U.S. Defense Department and NASA, but profitability remains a challenge. The company reported $962 million in launch revenue and a net loss of $542 million for the second quarter.

Future performance depends partly on Starship, the company's large rocket system that remains under development and testing. During its 14th test flight on September 28, 2026, Starship reached orbit and deployed dozens of new V.3 Starlink satellites, according to the source report. However, the vehicle has yet to establish reliable, reusable operations.

Investors are also awaiting updates on pending NASA missions and the future of the Falcon rocket program. The source report said SpaceX had reportedly stopped allowing other companies to launch cargo, including satellites, on Falcon missions.

SpaceX shares opened at $150 on June 12, 2026, the day of the company's Nasdaq debut, before slipping to $147.50 on October 20. The stock reached a low of $104.83 on August 3, shortly before the first post-IPO lockup expired. After the lockup ended on August 6, shares initially gained 6% and rose nearly 16% the following day.

Wall Street analysts have maintained positive ratings ahead of the results. Mizuho assigned SpaceX an outperform rating and a $200 price target in a Monday note from analyst Brett Linzey. Shares were trading at around $148 as of 10:45 a.m. ET on Tuesday.

Tesla, Musk's other publicly traded company, is scheduled to release its third-quarter results on Wednesday, October 21. LSEG estimates indicate revenue of $27.9 billion, a slight decline from the same period a year earlier. Tesla shares were down about 17% for the year as of Tuesday, according to the source report.

SpaceX scheduled its third-quarter earnings call for 4:30 p.m. ET on Tuesday, 30 minutes after the market close, and invited shareholders to submit questions online before the meeting.