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- Super Intelligence (SI) revenue increased 195% sequentially to $7.56 bln, generating $4.95 bln of adjusted EBITDA but $431 mln of operating income after substantial depreciation and stock compensation. Cursor contributed $608 mln of revenue. SI solutions and infrastructure revenue still grew 192% sequentially excluding Cursor, demonstrating strong underlying cloud demand.
- Connectivity revenue increased 69% yr/yr to $5.25 bln, operating income reached $2.37 bln, and adjusted EBITDA totaled $3.50 bln. Consumer subscribers increased 1.6 mln sequentially to 13.6 mln. ARPU rose 5% sequentially to $69 but declined approximately 17% yr/yr, qualifying the pricing improvement.
- Space revenue rose 84% sequentially but only 6% yr/yr, with a $7 mln operating loss versus $259 mln of income a year earlier. Flight 15 will attempt recovery of both stages.
- Nameplate capacity reached 1.7 GW, with 2.5–3.0 GW expected by year-end. Musk expressed high confidence in adding 10 GW of operational compute in 2027, implying roughly 13 GW total. The more aggressive 20 GW incremental objective concerns power and cooling infrastructure. The $100 bln year-end revenue-run-rate goal represents December revenue annualized.
- Q4 capex is projected at $35–$40 bln versus $19.59 bln in Q3. Nine-month operating cash flow of $13.10 bln trailed capex by approximately $34.97 bln, although $51.29 bln of cash and equivalents exceeded $38.84 bln of debt and finance leases following substantial IPO funding.
- Consolidated adjusted EBITDA reached $8.81 bln, but net income benefited from other income and a tax benefit. Connectivity’s gross margin included a roughly three-percentage-point one-time benefit, primarily tariff refunds, while approximately $23.4 bln of Cursor-related employee equity awards will generate compensation expense over roughly three years.
- SPCX and Tesla (TSLA) have formed independent special committees to evaluate a potential merger, with Musk excluded from their discussions because of his conflicting interests. Musk cited potential benefits across AI software, chip design, Terafab, robotics and connectivity, but no transaction terms have been agreed, and he cautioned that a deal is not assured.
Briefing.com Analyst Insight
Compute deployment is generating substantial revenue, with management citing sub-one-year paybacks and $63 bln of backlog, including approximately $42 bln expected to convert within a year. However, short-term compute contracts create repricing exposure, while Q4 gross margins are expected to return toward Q2 levels. A potential TSLA merger could deepen integration across AI, chip development and robotics, but the absence of agreed terms leaves the financial benefits, ownership dilution and capital-allocation implications uncertain. Starlink provides earnings diversification, but sustaining returns requires timely capacity activation, disciplined funding and sufficient cash generation to support expanding infrastructure, depreciation and compensation costs.
