SpaceX (SPCX) reported third-quarter revenue up 161% year over year to $14.6 billion and net income of $4.4 billion, compared with a $1.1 billion loss a year earlier. Its AI segment, now called super intelligence, grew revenue 830% to $7.6 billion, while connectivity revenue rose 69% to $5.2 billion and Starlink subscribers reached 13.6 million. Capex was $19.6 billion in the quarter, $16.4 billion of it for super intelligence, and management guided to $35 billion to $40 billion in the fourth quarter. The stock trades at about 67 times sales, so the author expects strong earnings may not move the share price much. He prefers to wait for a more reasonable price, suggesting watching the stock or starting with a small position.
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SpaceX reported third-quarter revenue up 161% year over year to $14.6 billion and net income of $4.4 billion, making it profitable. Its AI segment, now called 'super intelligence (SI),' generated $7.6 billion in revenue, up 830% year over year and 195% sequentially, making it just over half of sales and the largest revenue source. Connectivity remains the most profitable segment with $2.4 billion in operating income, versus $431 million for SI, which lost $1.26 billion last quarter. SI accounted for $16.4 billion of the company's $19.6 billion in Q3 capital expenditures, but the results should ease concerns that it is a money pit, as cloud agreements with Alphabet and Anthropic and $608 million of Cursor revenue since its August acquisition show the investments are paying off. The author notes the stock remains richly valued.
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