SpaceX reported second quarter revenue of $7.8 billion, beating Bloomberg consensus estimates of $6.81 billion, in its first financial report as a public company. Despite the revenue beat and an adjusted EBITDA of $3.5 billion—surpassing the $2.0 billion expected—the stock hit a new all-time closing low, dropping 13.6% on Wednesday due to surging AI capital expenditures and a looming insider lockup expiration.
AI Spending Surge and Capital Expenditure Risks
SpaceX is aggressively scaling its AI infrastructure, with spending hitting $15.8 billion in Q2. This is a sharp increase from the $7.7 billion spent in Q1. While the AI segment’s operating loss of $1.26 billion was better than the estimated $2.39 billion, the sheer volume of investment is alarming investors.
JPMorgan analyst Doug Anmuth warned in a note to investors that projected capex could reach nearly $200 billion in both 2027 and 2028. Anmuth noted this trend is consistent across hyperscalers and puts significant pressure on free cash flow for 2027. The primary concern is whether these massive infrastructure investments will generate a healthy return given the cash required.
Did you know? SpaceX’s total Q2 capital expenditures were $18.37 billion, which actually came in slightly below the $18.58 billion analysts had estimated.
Nvidia Partnership and the Starmind AI-1 Payload
To bolster its orbital computing, SpaceX is partnering with Nvidia to design the Starmind AI-1 payload. This initiative aims to bring “datacenter class compute” into space. The system will utilize Nvidia’s Rubin GPUs and Vera CPUs, which SpaceX says will increase its peak satellite computing capacity to 250 kW.
CEO Elon Musk confirmed during the earnings call that Nvidia will serve as the exclusive supplier of chips for SpaceX’s AI needs. This move signals a deep integration between the two companies to maintain a competitive edge in space-based artificial intelligence.
Starlink Growth and Starship Flight 14
The connectivity arm of the business continues to scale. SpaceX reported that Starlink subscribers exceeded 12 million by the end of Q2. The service generated an adjusted EBITDA of $2.60 billion, beating the $2.41 billion estimate. Musk stated on the earnings call that it is “not out of the question” that Starlink could eventually deliver the majority of the world’s internet.
On the hardware front, SpaceX is preparing for Flight 14 of Starship. Musk posted that the company will attempt to catch the ship’s upper stage using the Mechazilla tower arms at Starbase, provided mission data review shows no problems. This follows previous successful catches of the larger Super Heavy booster.
Market Pressure: Lockup Expiration and Tesla Merger
The stock faces a significant supply overhang. Cory Johnson of Epistrophy Capital wrote in a client note that on August 6, a lockup expiration will free hundreds of millions of insider shares. This represents roughly triple the current tradable float and could allow up to 20% of shares to be sold, potentially keeping the stock under pressure.
Further complicating the outlook are reports from The Wall Street Journal that Musk is pushing for a merger between SpaceX and Tesla. According to the report, executives are currently weighing how to handle Tesla’s China operations if a merger occurs, as SpaceX’s national defense contracts could create friction with the Chinese government.
Pro Tip: When analyzing “frontier” AI companies, watch the ratio of Capex to Annual Revenue Run Rate (ARR). While SpaceX’s spending is high, Musk claims the ARR could hit $100 billion by the end of the year.
Quick Comparison: SpaceX Q2 Financials vs. Estimates
| Metric | Actual (Q2) | Consensus Estimate |
|---|---|---|
| Revenue | $7.8 Billion | $6.81 Billion |
| Adjusted EBITDA | $3.5 Billion | $2.0 Billion |
| Starlink EBITDA | $2.60 Billion | $2.41 Billion |
Frequently Asked Questions
Why did SpaceX stock drop despite beating revenue estimates?
Investors are concerned about the massive increase in AI capital expenditures ($15.8 billion in Q2) and the upcoming August 6 lockup expiration, which will significantly increase the supply of tradable shares.
What is the Starmind AI-1 payload?
It is a joint project with Nvidia to bring datacenter-grade compute to orbit using Rubin GPUs and Vera CPUs, increasing peak computing capacity to 250 kW.
How many Starlink subscribers does SpaceX have?
As of the end of Q2, Starlink subscribers topped 12 million.
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