how did economists react to spacex earnings?
Some brokerages appeared optimistic about SpaceX’s quarterly earnings: JPMorgan analysts, who lifted their price target for shares to $240 from $225, wrote SpaceX is benefiting from “extreme vertical integration” while noting its “pace of change in AI is incredibly fast,” and that a step-up in AI infrastructure and higher monetization could push SpaceX’s AI revenue to $100 billion in 2027. Wells Fargo analysts cut their price target for SpaceX shares to $215 from $230 amid broader caution about its AI spending, noting that SpaceX was “off to an ambitious start” and that revenue projections for 2027 and 2028 were higher than expected, but so were capital expenditure estimates. Kathleen Brooks, research director at the brokerage XTB, told The Wall Street Journal, “The concern for investors is how fast expenditure growth is outpacing revenue growth.”
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what to watch for
A stray piece of a SpaceX rocket that floated in space over the last year likely crashed into the moon early on Wednesday, the BBC reported, though images of the collision have yet to be processed. The rocket is believed to have crashed near the Einstein Crater, located on the other side of the moon from the Apollo 11 landing site in an area that receives daylight and is visible from Earth.
crucial quote
Chris Beauchamp, IG’s chief market analyst, told CNBC: “Part of a SpaceX rocket crashing into the moon this morning is probably a good metaphor for the share price performance so far.”
surprising fact
If SpaceX shares fall below $100, that would imply investors saw no value from the rocket maker’s AI business, Morgan Stanley analysts wrote last month. Some already see “zero or negative value” as SpaceX ramps up its spending on space and connectivity amid “largely uncertain economics,” the analysts said.
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forbes valuation
Musk’s net worth was cut by $81 billion to $701.5 billion in SpaceX’s decline, according to Forbes’ estimates. His fortune swelled by more than $57 billion ahead of SpaceX’s earnings report on Tuesday, and a reduction on Wednesday still has his net worth well above that of Google co-founder Larry Page ($309 billion) and Amazon’s Jeff Bezos ($278.3 billion), who rank as the second- and third-richest people in the world, respectively.
key background
The earnings report marks the first quarterly financial update from SpaceX since its historic trading debut in June. SpaceX shares have lost more than half their value since hitting an all-time high above $220 by June 16, when Musk’s fortune topped $1.45 trillion, even as analysts still appeared bullish about the company’s business prospects. Not much has pushed SpaceX shares toward the green, even after a successful Starship test launch last month that later resulted in the stock stumbling by nearly 5%.
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further reading
ForbesElon Musk’s Wealth Sinks Below $700 Billion As SpaceX Rout ExtendsBy Ty Roush