Musk Backs SpaceX-Tesla Merger Talks, but No Deal Agreed
Elon Musk said he would support a possible merger between SpaceX and Tesla, while stressing that no deal has been agreed. SpaceX reported $4.4 billion in net income for the July–September period, its first quarterly profit since going public, as revenue rose 161% to $14.6 billion. Independent director committees at both companies are studying the proposal at shareholders’ request.
Elon Musk backs SpaceX-Tesla merger discussions, but the companies have not agreed on a deal. SpaceX reported $4.4 billion in net income for the July–September period, its first quarterly profit since going public, as revenue jumped 161% to $14.6 billion.
Musk said special committees of independent directors at both companies had been set up at shareholders’ request to examine the idea. He cannot take part in their discussions because of a conflict of interest, he told analysts.
“I think that would be overstating it,” Musk said, rejecting the idea that a merger was certain. He also described approval by a majority of all Tesla shares—not just shares cast in a vote—as “quite a high hurdle”.
SpaceX shares rose in after-hours trading following his remarks. Euronews reported a rise of nearly 5%, while the Associated Press report carried said the stock gained 7.5%.
The differing figures reflect the reports’ accounts of trading after the call. Both described a positive market reaction, but the committees have yet to settle any terms, and Musk said there was no guarantee they would.
AI revenue drives SpaceX profit
The quarterly results showed a sharp reversal from a year earlier, when SpaceX recorded a net loss of $1.1 billion. Revenue reached $14.6 billion, up from the prior-year period, according to Euronews and the Associated Press.
SpaceX’s AI division became its largest source of revenue. Euronews said the unit brought in $7.6 billion, more than nine times its year-earlier revenue, while CNA reported $7.56 billion. The division’s sales came largely from renting computing capacity to AI companies.
SpaceX cited cloud services agreements, broader use of its Grok chatbot and its acquisition of Cursor, an AI coding start-up, as factors behind the unit’s growth. Its customers include Anthropic and Google.
The company’s AI shift matters to investors because it is changing the sources of SpaceX’s sales as well as its spending profile. The new revenue helped lift quarterly results, but building computing infrastructure carries substantial costs: SpaceX invested $19.6 billion during the quarter, including $16.4 billion in AI, Euronews reported.
Starlink, SpaceX’s satellite internet business, also grew. Revenue rose 69% to $5.2 billion, and the service had 13.6 million consumer subscribers. Average monthly revenue per consumer fell to $69 from $83 a year earlier.
That split gives investors a clearer picture of the company’s competing financial forces: AI is now the biggest sales source, while Starlink remains a major part of its business. The reports do not establish that a merger would change either unit’s operations or financial performance.
Approval and deal terms remain open
Musk said the two companies could benefit from cooperation on AI software, chip design, robotics and space-based computing. He is chief executive of both firms and also serves as SpaceX’s chairman and chief technology officer.
His roles and ownership make the independent committees central to the review. Euronews reported that Musk owned 48.4% of SpaceX as of June 30 and controlled more than 82% of its voting power through shares with enhanced voting rights. The committees are examining the proposal independently, while Musk says he cannot participate.
The reports offer no agreed terms, and the approval requirement for Tesla shares remains a significant hurdle. The committees’ review is the next step identified publicly; Musk said the outcome is uncertain.
“I think that would be overstating it,” Musk said of treating a merger as a certainty.
