SpaceX revenue soars 161% as AI business grows
SpaceX, led by Elon Musk, released its second-ever quarterly earnings report.
SpaceX, the aerospace company led by Elon Musk, increased its revenue by 161% in the three months ending in September compared with the same period a year earlier, according to an earnings report released Tuesday.
The large increase in revenue was mainly due to major growth in the company's artificial intelligence (AI) businesses and Starlink, its satellite internet service, the report showed.
SpaceX reported a total profit of $4.40 billion in its latest quarter. This was a major change from the $1.05 billion loss it reported during the same three-month period a year earlier.
The company also reported a loss in the previous quarter, which ended in June. This means its latest earnings report showed that it had returned to making a profit.
SpaceX shares rose nearly 4% in trading after the stock market closed following the earnings report. The share price reached about $153.30.
The company, founded and led by Musk as CEO, is valued at nearly $1.95 trillion. This earnings report was only the company's second public report of its quarterly finances since it went public in June.
In its first earnings report, released in August, SpaceX said it had earned $7.8 billion in revenue during the three months ending in June. That was more than the $4 billion it earned during the same period a year earlier. However, the company still spent more than it earned.
SpaceX builds and operates spacecraft, including thousands of satellites that support its Starlink satellite internet service. The company also runs xAI, which offers a chatbot that competes with products such as OpenAI's ChatGPT and Anthropic's Claude.
Starlink is the main source of SpaceX's profits, so investors were paying close attention to the business before the earnings report was released.
Earlier this month, Starlink acquired low-band radio spectrum covering the entire United States. This suggests the company may try to compete with U.S. mobile phone carriers, Paul Golding, a senior analyst covering digital infrastructure and payments at Macquarie, said in a statement to ABC News.
"We'll be listening for launch timing, terrestrial build plans and appetite for more spectrum," Golding said.
On Tuesday, SpaceX reported $5.2 billion in revenue from its connectivity business during the latest quarter. This part of the company includes Starlink. The figure was 69% higher than revenue from the same quarter a year earlier, according to the earnings report.
SpaceX has spent large amounts of money developing AI infrastructure, including data centers. In the previous quarter, its AI business reported an operating loss of $1.26 billion. One reason was that spending on AI more than doubled compared with the quarter before.
However, the AI business made an operating profit in the three months ending in September, earning $431 million from its operations.
The earnings report came one day after Musk promised to give every child in the United States a share of stock in SpaceX.
"Next year, I will give one of my SpaceX shares to every kid in America. This will be the first of many," Musk said in a post on X.
The latest U.S. Census data estimated that about 73 million people in the United States are under age 18. Based on that number and a SpaceX share price of about $150 on the day Musk made his announcement, the giveaway would be worth nearly $11 billion. By Tuesday afternoon, the share price had fallen slightly to about $148.
The latest data from Fortune put Musk's net worth at $927.4 billion. This means the promised giveaway would be worth about 1.1% of his wealth.
Musk made his promise as some policymakers, investors and members of the public raised concerns about how AI could affect jobs and the wider economy.
In recent quarters, increased spending on AI has helped boost the U.S. economy. However, some economists have warned that the industry could drive prices higher and reduce job opportunities for some workers.
Meanwhile, a series of recent cyberattacks carried out by autonomous AI systems has worried some technology industry experts and public figures. They are concerned that the technology could pose serious risks to important institutions that rely on digital systems.
Analysts who previously spoke to ABC News strongly disagreed about how likely it is that AI could cause a major disaster. Some said such an outcome is likely if the industry does not put strong enough safety measures in place. Others said the danger was unclear and unlikely to happen.