From Rockets to AI: SpaceX Posts Its Biggest Growth Quarter Yet

In its first-ever quarter as a public company, SpaceX (SPCX) showed the market it is no longer just a rocket company; it is a space, internet, and artificial intelligence (AI) business growing at breakneck speed. Revenue jumped 92% from a year ago to $7.8 billion, comfortably beating Wall Street's estimate of about $6.9 billion, and the company narrowed its net loss to $541 million from $1 billion a year earlier. 

The standout driver was AI: revenue in that segment nearly tripled after SpaceX signed $14.1 billion in new cloud computing contracts, while its Starlink internet business doubled its subscribers to 12 million. At the same time, the company is spending enormous sums, $18.4 billion in the quarter, most of it on AI computing power. A bet management says will pay off quickly. 

The key thing for investors to watch: A share lockup expires on 6 August, which could sharply increase the number of shares available to trade and add pressure to a stock already down about 49% from its June high. 

Key Financial Metrics

●      Revenue: $7.8bn (92% up from $4.1bn)

●      EBITDA: $3.5bn (191% up from $1.2bn) 

●      Loss from operations: -$143m (vs -$970m), a much smaller loss year-over-year

●      Reported net loss: -$541m (vs net loss of $1bn prior year)

●      Capital expenditure: $18.4bn (vs $2.8bn), of which $15.8bn was AI build-out

●      Operating cash flow: +$3.5bn (vs +$0.4bn)

Starlink — Largest Segment 

●      Revenue: $4.3bn (+66%)

●      Operating profit: $1.66bn (+79%), margin 39%

●      Segment EBITDA: $2.6bn (+64%) 

●      Starlink subscribers: 12m (doubled year-over-year)

AI (xAI/Grok/Cloud Compute) 

●      Revenue: $2.6bn (+247%)

●      Operating result: loss of $1.26bn (vs loss of $1.52bn)

●      Segment adjusted EBITDA: +$1.15bn (a turnaround vs -$276m prior year)

●      Compute capacity: 1.4 GW (up from 0.4 GW a year ago) 

Space (Launch)

●      Revenue: $962m (+29%) 

●      Operating result: loss of $542m (vs loss of $369m)

●      Launches: 38 total in the quarter 

Analysis & Outlook

Share Price Performance 

SPCX closed at $125.33 on 4 August, up 9.43% on the day. Despite the revenue beat, the stock sits about 44.5% below its June high and below its $135 IPO price. The muted reaction seems driven more by sentiment than by the numbers; investors are bracing for insiders to sell once the lockup lifts. SpaceX does not pay a dividend.

What Could Move the Share? 

Upside catalysts:

●      $100bn revenue by December: Management says it is on track; hitting it would validate the growth story.

●      AI compute demand: New cloud deals with Google and Anthropic reportedly paid back in under a year. A plan to grow capacity from 2 GW to 10 GW and launch orbital data centres in 2027. 

●      Starship progress: Catching the top part of the rocket back on land, instead of letting it crash into the ocean, would prove the whole rocket can be reused, like a plane that lands and flies again, instead of being thrown away. Reusing it is far cheaper than building a new one each time. 

●      Starlink expansion: V3 satellites promise roughly 10x more capacity, plus new airline and mobile-carrier deals and $6bn of Starshield government work.

Downside risks:

●      Lockup expiry (6 Aug): Up to 912m shares become sellable, potentially tripling the tradable float, and a further 12.9bn shares will free up by mid-2027, a persistent overhang.

●      Enormous spending: $18.4bn of capital expenditure in one quarter; some analysts expect years of cash burn that may require repeated outside funding.

●      Uncertain AI payoff: Investors have punished peers (Alphabet, Tesla) for heavy AI spending with unclear returns; SpaceX may face the same scrutiny.

Analyst Consensus 

Analysts' consensus rate is buy/moderate buy. The average 12-month price target is about $223 (range roughly $62 to $800), implying substantial upside of around 75% - 80% from current levels. The very wide target range shows how divided opinion is. 

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** This article was prepared by BROKSTOCK analyst Maboko Seabi