SpaceX is expected to announce third-quarter results, Tesla shareholders should pay close attention

SpaceX will announce its third-quarter results after the market closes on Tuesday and will host a live stream on the X platform at 4:30 PM Eastern Time, with Tesla following up the next day. According to Bloomberg's consensus forecast, SpaceX's revenue is expected to reach $12.89 billion, with adjusted EBITDA of $6.62 billion and adjusted earnings per share close to US$0.15 (approximately HK$1). This would represent a growth of about 65% from the second quarter and mark SpaceX's first profitable quarter since its initial public offering (IPO).

Analysts estimate that revenue from artificial intelligence will be around $6.4 billion, while Starlink's revenue is expected to be about $4.9 billion, with anticipated consumer subscriptions reaching 14.3 million. Capital expenditure is forecasted at $19.6 billion, with free cash flow approaching negative $11.6 billion. The significance of these figures lies in the fact that SpaceX has spent months earning market trust.

SpaceX Performance and Market Trust

The company set its record IPO price at US$135 (approximately HK$1,053), which peaked at US$225.64 (approximately HK$1,760) before sliding to around US$105 (approximately HK$819) in early August. Last Friday's closing price was US$146.03 (approximately HK$1,139), down about 28% from June's peak. The second-quarter report showed revenue of $7.8 billion, with Starlink subscriptions at 12 million, but capital expenditures of $18.4 billion pressured the stock price. Since then, SpaceX successfully launched Starship on its 14th flight, deployed 26 Starlink V3 satellites, and agreed to purchase 800 MHz of spectrum for approximately $8 billion as part of its Starlink

mobile propulsion plan, and signed its fourth computing hosting agreement worth about $13 billion annually within four months.

Impact of the Tesla Merger

Management's goal is to achieve over 2 GW of computing capacity and a revenue run rate of $100 billion annually by year-end. Evercore ISI has raised its target to US$275 (approximately HK$2,145), indicating that this quarter's valuation may be more based on these goals than on reported figures. All of this is under the shadow of the Tesla merger issue. Barclays analyst Dan Levy expects SpaceX to acquire Tesla in an all-stock transaction at a premium, using reference values of $21 trillion and $15 trillion, and noted that if a vote is to take place at Tesla's annual meeting on December 6, an announcement would need to be made by the end of October or early November.

Barclays estimates that Elon Musk will hold approximately 37% of the merged company's shares and 56% of the voting rights.

Elon Musk stated in July that merger discussions could not be addressed during the earnings call, but there have been investor inquiries on SpaceX's Q&A platform about when the merger with Tesla might occur, and Teslarati has tracked how the Roadster demonstration could reignite discussions. If the deal goes through, Tuesday's earnings results will effectively set the price for Tesla holders. Their shares will convert into SpaceX stock while also gaining access to a company heavily invested in artificial intelligence, with Tesla expected to exceed $25 billion in capital expenditures by 2026.

A strong quarter and more stable expenditures would facilitate this exchange, while another round of heavy capital expenditures and a decline in stock prices would complicate matters.

Key Impact of Earnings Results on Merger Plans

SpaceX's third-quarter results will serve as a critical indicator affecting its merger plans with Tesla. A strong performance will help boost market confidence and facilitate the merger process. Conversely, high capital expenditures or a decline in stock prices could hinder the merger. Elon Musk's perspective on the merger and the market's trust in SpaceX will directly influence investor decisions, thereby impacting the future development of both companies.